• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Evaluate the influences of Multinationals through Globalisation

Extracts from this document...

Introduction

EVALUATE THE INFLUENCES OF MULTINATIONALS THROUGH GLOBALISATION A multinational is a firm which has its headquarters in one country but with bases, manufacturing or assembly plants in others. A company would have a number of objectives which would drive them to expansion including: o Increased sales and revenue o A chance to sell in markets where incomes are growing most strongly o Shareholder pressure to maintain profit growth o The opportunity to diversify into a range of markets so that heavy dependence on one or a few markets, which could decline, can be avoided. This reduces risk. The process of globalisation has three distinguishable phases for the individual business: o Companies with a national focus look to expand their markets by selling abroad. ...read more.

Middle

In addition, ancillary firms such as component manufacturers and suppliers of canteen and cleaning services grow in the local area and provide additional employment. ==> Other factors of production are employed more fully and are used more efficiently through the competition generated by the multinational. ==> Advanced technology is introduced. Examples in the UK include the work that Honda did with Rover, and technology-based multinationals such as Epson (printers), Sony (home entertainment), bringing in new ideas and expertise into our economy. Training in more advanced techniques and skills also develops in the local area. ==> Modern work practices which highlight teamwork, shared goals, and employee participation in decision making. ==> There is greater choice and higher income. Consumers benefit from wider product choice and the economy gains through the multinational's activities, both at home (employment rises, tax revenue is generated and greater expertise improves economic competitiveness), and by exporting (balance of payments benefits). ...read more.

Conclusion

Accusations of bribery, corruption and financial irregularity have been levelled against some multinationals, and exploitation of cheap labour and raw materials can take place with only limited concern for the environment or the long-term stability and growth for the countries affected. As I have discussed, the most obvious way to expand sales to is start selling abroad. Some companies such as Coco Cola have been able to create global brands, which sell world wide. Their strategy is to develop an image that will appeal to everyone everywhere. Coke is perhaps an unusual product in that it can sell in large quantities even in countries wit low incomes. Many global brands are prestige products which sell mainly to people with well-above average incomes. Global brands, by their name are fully standardised. The coke selling in Thailand is the same as the coke selling in the USA. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our GCSE Economy & Economics section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related GCSE Economy & Economics essays

  1. This report will establish the opportunities and threats presented to Sony by the EU ...

    Another specialists whom I recommend Sony to employ are Accountants. This is because they can keep a tally on the turnover which Sony have also monitor how much money coming in and out of the company so there are no scandals operating within Sony because this may cause bankruptcy in the future.

  2. external influences

    * At the warehouse, they use electric fork lift trucks (to prevent pollution). Any broken wooden pallets (on which the large boxes are transported) are recycled rather than scrapped. Cardboard boxes are also recycled. The economy In economics, the word boom and bust refers to the movement of an economy through economic cycles due to changes in aggregate demand.

  1. Sports manufacturers

    Opportunities Good market conditions... Market conditions for sports clothing brands will be favourable, with the size of the core 20-24 age group continuing to grow. There will also be opportunities to target older consumers and, in particular, those in the rapidly expanding 55-64 age group who continue to participate in sports and leisure activities.

  2. Business - External Influences.

    If the economy needs a boost, government expenditure can be raised. This creates employment, increased income and demand for other goods. Taxes can also be decreased to encourage consumers to spend more money. Expenditure can also be curbed if the economy needs to slow down to control inflation.

  1. External Influences on Business Activity.

    they no longer control this aspect of fiscal policy since the Bank of England now independently sets and adjusts interest rates. Most businesses rely upon borrowing in particular to finance capital investment for growth. If interest rates rise then the cost of borrowing rises and this in turn leads to

  2. External Influences of Richer Sounds and Corus

    Richer Sounds now endorse their business online, they can advertise too. By advertising their company online they are saving money because it is cheaper. The products they sell have changed as technology has rapidly transformed. Overall these technological changes have helped the business develop and be more successful.

  1. External influences

    �1.00=$1.83 (US), and �1.00=72.07 THB. By having a strong currency over the overseas currency, businesses in the UK is able to save in buying things abroad and bring them back to the UK and sell them at substantial price to make a profit.

  2. Case Study: The Home Depot

    Good divided between the larger retailers (like Home Depot) and smaller competitors. Of course there was competition between the larger ones and the between the smaller competitors, but in general there can be said that it was a rather peaceful environment, which stimulated for growth.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work