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ACCA P3 Chapter 12 Methods of growth and portfolio management
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Thanks for your video. I personally had some difficulty distinguishing them at first though by watching this video and reading some articles including this one https://legamart.com/articles/franchising-or-licensing-pros-and-cons/, my penny has dropped.
Hello sir,
1) difference between licensing and franchise is still not clear. seems so similar that i cannot draw the distinction line.
2) do synergy managers always need to merge business or it can be some sort agreement or strategic alliance also. For example ABC construction company and XYZ interior designing company join hands together?
regards
There isn’t a very distinct difference between licensing and franchising. Franchising tends to be a more complex and detailed arrangement whereas licensing can be a simple agreement that you can sell a product or use a process.
Synergy management could be through a strategic alliance, though the categories of portfolio, synergy manager and parental developer are usually used to describe the relationships between a holding company and its subsidiaries.
Thank you so much for the lecture. I’m only getting a bit confused between licencing and franchise.
Fantastic!
Good example of licencing on this headline:
The $500 Million Battle Over Disney鈥檚 Princesses
How Hasbro grabbed the lucrative Disney doll business from Mattel.
Thank you very much for this excellent lecture.
I got one small doubt regarding strategic alliance, would really appreciate if you could tell me any better way of understanding strategic alliance, I could not get it from the above lecture.
Thank you
It’s really a cooperation between different organisations – some of which might appear to be in competition. So:
Airbus and Rolls Royce could have an alliance to develop a more fuel-efficient jet.
Ford and battery manufacturer could have an alliance to develop a long-range electric car
A supermarket and a bank could have an alliance to develop and run a credit card under the name of the supermarket.
Got it now, thank you Sir
Thank you for this lectures
can we classify franchising as a form of strategic alliance ?
I wouldn’t. I always think of a strategic alliance as less formal than something like a JV or franchise agreement.
and company A also has no experience in acquiring foreign business and running it
Yes, kind of ballast. What this model does not take into account is the possibility of economies of scale and the combined company might be able to offer a better and cheaper service than the two separately.
If Company A has no experience of operating overseas, then there is also a danger of a value trap: you think you can help, but don’t really understand what’s needed, so there is a chance value could be destroyed.
thanks 馃檪
hi gromit , suppose there is company A which is market leader in logistics and wants to acquire another company , B, in another country , company B is also in logistics and holds almost all contracts and faces no competitors so , if company A acquires company B will the acquired business be ballast business in ashbridge portfolio display ? since the company B is already performing well ?