One of the disadvantages of licensing is the lower potential returns, compared to other forms of entry into the foreign market, because the revenues are shared between the parties.

Question

Quizplus · Accepted Answer

Licensing involves sharing revenues generated from the licensed product or service with the licensor, typically resulting in lower potential returns for the company entering a foreign market compared to wholly owned subsidiaries or other forms of direct investment where the company retains full control over profits.

One of the Disadvantages of Licensing Is the Lower Potential