Which of the following is a market entry strategy in which independent companies form a partnership to collaborate in the foreign market but do not necessarily invest in each other?

• A. Strategic alliance
• B. Joint venture
• C. Direct investment
• D. Franchising

Answer: (A)

When companies want to enter a foreign market without tying up equity or creating a new shared company, they often form a strategic alliance. This arrangement lets independent firms cooperate by sharing resources, knowledge, or access to distribution channels while each company remains legally and financially separate. The key feature is collaboration without a cross-investment or a new entity, which matches the description given.

Joint ventures involve creating a new, jointly owned company, with shared ownership and governance. Direct investment means owning and controlling foreign operations, usually with significant capital commitments. Franchising centers on granting a franchisee the rights to operate using the brand and business format, typically involving fees and ongoing royalties.