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Asked a question 3 years ago

What are the different methods of asset lite model?

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1) Franchising


Franchising is one of the way to expand easily with a very less investment. This is beneficial for both franchisor and franchisee, as now the franchisor has to invest in the form of the of training the employees hired by the franchisee and giving the software support i.e. tools which will help a franchisee within it's sales whereas the franchisee has to pay the licensing fee with the profit percentage to the franchisor for getting a full-fledged business setup of a well known brand. These small investment helps both of them to expand easily.


McDonald's, Pizza but etc.


2) Outsourcing


Outsourcing can help you to divide your work in parts so that you can work set of task without taking much tension about the other tasks.


Apple is a well known smartphone brand.  It produces the best quality of smartphones all over the world. But you will be surprise to know the fact that Apple doesn't makes the smartphone by themselves whereas outsource this work to a different company and just works on the r&d and sales of their smartphones.


3) Renting your License



The license can be rented, which can reduce the cost for both the companies. The companies which are licensing out and licensing in, will be getting a low cost of production and other expenses.


Most of the pharmaceutical companies are doing the same thing i.e. renting their licensing with the other companies.