What is cooperation?

Cooperation
is an agreement between two or more firms that share part of
their resources in order to increase its competitive advantages

Chapter 10: Business cooperation Advantages:

INES HERRERO CHACÓN
UNIVERSIDAD PABLO DE OLAVIDE
SEVILLA
– Quicker response to changes
– Higher flexibility
– Increase of competitive advantages
Disadvantages:
– Higher coordination costs
– Risk of spread of competitive advantages

Types of cooperation (I) Types of cooperation (II)

• Outsourcing
• Outsourcing Contracting other firm for some services, for the production of some
of the products the firm commercializes or some components.
• Licensing
• Licensing
• Franchising entering new markets by transferring the rights to produce and sell
• Strategic Alliances products overseas to a foreign firm

• Joint Venture • Franchising

entering new markets in which the franchise pays a fee for using the
• Foreign Subsidiary brand name and agrees to follow the standards and rules
• Regional clusters • Strategic Alliances
Partnerships between and organization and a foreign company in
which both share resources and knowledge in developing new
products or building new production facilities.

Types of cooperation (III)

• Joint Venture
A specific type of strategic alliance in which the
partners agree to form a separate, independent
organization for some business purpose.
• Foreign Subsidiary
Directly investing in a foreign country by setting up a
separate and independent production facility or office.
• Regional clusters
Cooperation among firms that are geographically close
to each other. Cooperative-competitive.