FOM
Attention Interest Desire Action Fom When company enters global market, there got disadvantages that will affect the company. There got three disadvantages of using licensing to enter the global market. First, the licensor gives up control of its product and reduces the potential profits gained from it. Carlsberg sells the product everywhere in the countries. If something happen to the company product in some places, Carlsberg might not control the situation because the numbers of product are too large. Carlsberg also might not able to control its entire product since the product is selling in everywhere. Carlsberg will facing the problem of the customer will not believe the company product anymore. This will also decrease the sales of Carlsberg and might influence the profit. Second, the licensor may be creating its own competition because some licensees are able to modify the product and enter the market themselves with the product and marketing knowledge gained from the licensor. The possibility of nurturing a potential competitor is viewed by many companies as a disadvantage of licensing. The licensees will learn all the business knowledge from Carlsberg and know all the strategy that Carlsberg use in the market. Once they quit the company, they will become the competitor to Carlsberg. Carlsberg will face the competitor problem because the competitor knows Carlsberg as well and try to beat down the product of Carlsberg through their knowledge. Third, if the licensee is a poor choice, the name or the reputation of the company may be harmed. If Carlsberg got the poor licensee, it might destroy the future of company. If the licensees do not manage the Carlsberg business as well, the Carlsberg business will influence by the bad management. Since the local company’s marketing skills may be less developed, revenues from licensing may suffer accordingly. A foreign company’s image may suffer if a local licensee markets a product of substandard quality....