Just a brief introduction to Mutli-Nationals, linked to our Saint Gabion and Stanton work.

We started with a bit of a teaser.

Some of us were not surprised to learn that Coca-Cola is worth more than Ethiopia!

Points to remember

• A Multi-National is a company based in more than one country, it may have factories and offices in several different locations. Also called a Trans-National Corporation. The terms are used interchangeably, though in reality a Corporation is a legal person, a bit complex, so I won’t go there…

Why base yourself in more than one country?

• Larger markets, more people, more profit.
• To find the lowest overheads in order to produce your products and maximise profits.
• To avoid import taxes and quotas.
• To raise the status of your brand/product.

Remember McDonalds serves 53 million customers daily, in over 120 different countries.

How do you know if it is a Multi-National?

All Multi-Nationals seem to have some, or all of the following common characteristics.

• Headquarters are found in MEDC countries.
• Means of production tend to be found in LEDC countries, where overheads are lower.
• Well-known brands, some endorsed by celebrities.
• High product turn overs and profits.

So what’s the issue?

Some people have concerns about Multi-Nationals for a number of reasons.

(At this point I did provide some examples, but I’m avoiding putting them into print, in case I am took to court. )

• Some believe they are too powerful, effectively buying local and national decision-making.
• People are worried that such companies are developing a globalised culture, resulting in the loss of localised tradition.
• There is concern at their poor record of environmental management and labour relations.
• Some are so powerful, they effectively have a monopoly, squeezing out competition, this is bad for the consumer, as they have less choice and higher prices.

To balance this, we started to look at different viewpoints with regards to Multi-National inward investment.

So, what has this all got to do with Stanton? This slide sums it up nicely.

One of the criticism labelled at Multi-National companies, is that they have no country loyalty, like an octopus, they have no problem with losing an arm, to ensure the profitability of the company.

Made the link?

Tomorrow, we need to finish up the positive and negative viewpoints of Multi-Nationals investing in a country.

We’re also going to be doing a little decision-making on the future of the Stanton site.

A two-part homework this week can be found under work set.

Now got your mocks and will begin marking them during my commute to College each day, should be done by Monday.

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Posted in My place
Written on Mon, 12 March 2007 at 10:05 pm

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