A firm in South America wants to open a TJ Store in a shopping mall. What is the best approach for this firm?
A) strategic alliance
B) licensing agreement
C) franchise
D) foreign subsidiary
Answer: C
Explanation: Since the firm wants more than just the right to sell TJ Soft products–it wants to run an entire TJ Soft store–it should buy a franchise. The franchise will give it the right to operate a store under the TJ Soft name selling TJ Soft products. The relationship should not be a strategic alliance since TJ Soft wants to maintain control of its brand. A licensing agreement is not extensive enough since the company wants to do more than sell TJ Soft products. A foreign subsidiary is also not appropriate because it requires TJ Soft to own the foreign operation and this is not possible since the firm already exists.
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