After reading the case on Starbucks, I came to the conclusion that there are two main advantages for choosing the licensing mode of entry. First, licensing will bring in more revenue with little money to start with, for a company with the technology resource at the tip of their hands it would be an overall good pick. The major advantages will help the company overall as they enter their brand into different parts of the world.

Individually or locally licensing also fires up some of the government and regulatory problems a company will face upon entering the new market outside of the US. This was the problem they faced with China. The percentage own company can keep as in the amount of revenue they can bring back into the US or leave the country at all; all depends on these licensing rules.

Starbucks is trying to enter different markets with searching for various opportunities, however while doing this they will run into a various amount of strategy alternatives and there is not a “right” way to choose. Starbucks must chose they way they want to enter the market in a different country; do they want to keep their brand image or change what their known for in the US in order to fit into the country they are entering in. This one of the main problems Starbucks is running into while they are trying to build up Starbucks name in different countries with different cultures. In order for Starbucks to be a success the company keeps control of the locations they want to open outside of the US.

Lastly, another reason to pursue licensing would be a financial reason. We all know that Starbucks is a wealthy company; it’s a known fact. However Starbucks might not have the start up capital they need to open Starbucks globally. If they do not have the investment funds available that means they must borrow money and in the end will not bring in as much profit, as they would