Carmichael Candies, a U.S. firm, is considering the idea of entering the EU market through an international franchising agreement. What is the main advantage to Carmichael if the firm chooses this entry method?
A) avoidance of tariffs
B) independence from franchisee
C) potential public relations problems
D) high managerial and financial risks

Question

Quizplus · Accepted Answer

Avoidance of tariffs is a main advantage of entering a market through franchising. By franchising in the EU, Carmichael Candies can avoid the tariffs that would be imposed on exports, making it a cost-effective strategy for market entry.