FRANCHISE: Product licensing from licensee’s perspective

In perspective, motor vehicle producers use MLAs to access different components needed to assemble a motor vehicle. Whatever car you drive, it has very few (if any) components made by the car manufacturer. Most parts are sourced from licensed manufacturers, with the car manufacturer’s logo stamped on them, which are then assembled to the end-product you ride in. To entice licensees to invest heavily to support the vehicle brand, MLAs allow them to produce slightly higher volumes and sell in the after-market without the manufacturer’s logo, normally at cheaper prices than the vehicle manufacturer-branded component. So, next time you want to buy the same genuine brake pads for your car at 40 per cent lower than the dealer price, just find out who was originally licensed by the vehicle maker to supply the branded pads to the assembly plant!

FRANCHISE: Product licensing from licensee’s perspective

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