A multinational company, also commonly known as a multinational corporation or transnational corporation, deals with a business that has branches, offices or production facilities in various countries of the world.
Multinationals are companies that own or control the production in more than one nation. Likewise, their objectives may be to install offices and factories for production where they can obtain cheap labor and other resources. In addition, they choose this multinational location to take advantage of the low production cost and thus obtain more significant profits.
The headquarters of each multinational company is located in its country of origin. In fact, the activities are controlled and operated from the parent company worldwide. The products and services of multinational companies are sold in several countries that require global management.
Characteristics of multinationals
Regarding the main characteristics of corporations or multinational companies, are the following:
Continuous growth within multinational corporations is all the time booming. Even as they operate in other countries, they continue to strive to increase their economic size by constantly updating themselves.
It is a little difficult to become a multinational company. However, the goal can be achieved. Because they use modern capital-intensive technology, they come to have good quality products. Therefore they grow economically to the top.
The multinational companies in the top 10 today are known thanks to that that they can produce first-line products. Likewise, it is well known that multinationals are large and very important corporations within the global economy since they exercise a high degree of dominance in the world.
Among some of the most important are:
- Coca Cola
- Apple, among others
Advantages and Disadvantages of multinational companies
Types of multinational corporations
Three different models of multinational companies can be achieved, among them are: