INTERNATIONAL BUSINESS

ASYNCHRONOUS ASSIGNMENT 28-AUGUST-21

COMPARISONS OF JOINT VENTURE, M&A AND FRANCHISING

A joint venture agreement is a business agreement in which two or more entities enter into an
agreement for a specific purpose and the agreement is terminated once the purpose is met, whereas a
franchise agreement is a business agreement in which one party enters into an agreement with a
company to offer goods or services under the company's name and image. A merger occurs when two
or more companies join forces to form a new entity. When one firm buys another, the purpose is
usually to add the purchased company to its portfolio as a subsidiary.
Employees in a joint venture can enhance their careers by participating in a range of training
activities. Neither joint venture partner is required to instruct the employees of the other. In the event
of a franchise, the franchisor is responsible for providing training and guidance to its franchisees.
Mergers and acquisitions concentrations train students for careers in corporate performance
improvement and the establishment of new firms. This concentration investigates the nuances of
corporate restructuring while relying on fundamental accounting and finance principles such as
business performance, strategy, and operational decision-making.
A risk venture is one that fails to meet its goals and underperforms the market. Joint ventures, as
opposed to franchises, face greater market risk. Franchises, on the other hand, adhere to a tried-and-
true corporate model that has proven to be successful and must be a franchise success time after time
For example, if you join a well-known coffee franchise, the franchisor will offer you with the original
brand's business plan and logos. A franchise is a less expensive investment than a joint venture.
People prefer to invest in low-cost franchises as their first choice due to the lower risk involved. The
risks connected with mergers and acquisitions are as follows: Overpaying for the target firm,
overestimation of synergies, and insufficient due diligence procedures. Integration chasms. Culture
and change management are given less attention. Overall, there is a lack of open communication,
synergies are not being capitalised on, and Concerns about security that arose as a result of a
transaction that was not anticipated, market disruption that was not anticipated.
A joint venture usually has more freedom than a franchise. Joint ventures open up a completely new
market for goods and services. Joint ventures are not required to follow the norms and rules of the
member enterprises unless the agreed-upon terms of sale specify otherwise. A franchise, on the other
hand, must adhere to the franchisor's strategy and restrictions, especially in the case of food
franchises, where all franchises sell the same menu items and services globally. Alliances are more
cooperative, negotiated, and less risky. "Acquisitions are competitive, market-based, and dangerous;
partnerships are cooperative, negotiated, and less hazardous."
Here are the examples of M&A, Franchising, Joint Venture:
Mergers and Acquisitions:
 Arcelor Mittal
 Walmart and Flipkart
 Tata and Corus Steel
 Vodafone Hutch-Essar
Franchising:
 McDonalds
  KFC
 Pizza Hut
Joint Venture:
 GE and Microsoft
 The Walt Disney company
 Mahindra- Renault