• 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. Case Study: The Home Depot

    HD Social forces: Ageing homes & baby boomers (O).155.75XImportant market for Home Depot Technological forces: Internet (O).104.40XNew selling way, great outlooks Legal/ political forces: Traffic congestion (T).054.20XCan restrain shops to open(on time) Market forces: No product differentiation (T).104.40XForces HD to compete on certain issues TOTAL SCORES1.004.20 Chapter 4: Core Competencies Home Depot Inc.

  2. Toyota Motor Company Limited

    Promoting further globalisation within Toyota. iii) Enhancing cost competitiveness to provide higher quality products and services at a more affordable price iv) Expanding Toyota's value chain with a specific focus on building financial operations. Analysis of The Four Key Strategies Focusing investment on technological development: From the late 1990s,

  1. Sports manufacturers

    Beyond the labor issue, Nike has neglected two important publics: women and shoe buyers seeking a mid-priced shoe. In order to realize their potential sales, they must actively pursue these two publics. The following objectives aim to improve both labor concerns and domestic shoes sales.

  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

    the presence of dangerous substances in products, then disposing of it will automatically become simpler. Waste prevention is closely linked with improving manufacturing methods and influencing consumers to demand greener products and less packaging. 2. Recycling and reuse: If waste cannot be prevented, as many of the materials as possible should be recovered, preferably by recycling.

  1. External Influences of Richer Sounds and Corus

    Richer Sounds are also beginning to deal with problems more cautiously. Richer Sounds are using different methods of selling. They have extended their methods of selling in line with technological changes and customer demands. Originally Richer Sounds' began to sell in stores, and then they added a mail order service, however today they sell over the Internet too.

  2. External influences

    The Body Shop in the UK exchanges the � in overseas countries such as Africa and India; by going to countries with a low currency The Body Shop is able to make a substantial amount of profit. 4) Define inflation.

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