Multinational Companies

MULTINATIONAL COMPANIES

AN ITS IMAPCT ON COUNTRIES

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CONTENT: INTRODUCTION: HISTORY: MULTINATIONAL CORPORATION, DEFINITION: MARKET IMPERIFICATION: INTERNATIONAL POWER: IMPACT ON COUNTRIES: CONCLUSION:

INTRODUCTION A multinational corporation (MNC) or transnational corporation (TNC), also called multinational enterprise (MNE), is a corporation or enterprise that manages production or delivers services in more than one country. It can also be referred to as an international corporation.

History * The first Indian MNC was

East India company ,headquarter was situated in London ,founded in 1600 and defuncunct in 1858,formally dissolved in 1873.

* Company rule in India, which

effectively began in 1757 after the Battle of Plessey. *The Company itself was finally dissolved on 1 January 1874, as a result of the East India Stock Dividend Redemption Act.

The East India Company traded mainly in : n

Cotton, silk, indigo dye.

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Salt petre, tea, and opium.

“However, it also came to rule large swathes of India, exercising military power and assuming administrative functions, to the exclusion, gradually, of its commercial pursuits.”

EXPANSION n

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THE COMPANY BEGAIN TO EXPAND AS THEY HAD CAPITAL FROM THERE IMPERIAL PATRONAGE . STARTING FROM GOA, CHITTIONG, BOMBAY THEN THE SETUP A FACTORY IN SURAT ,MADRAS , BOMBAY DURING THE MUGHAL PERIOD WITH THE GRACE OF MUGHAL EMPERORS THEY FURTHUER EXTENDED THEIR NETWORK TO BENGAL AND NEAR BY REGIONS.

GLOBALISAION n

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MNC’S CREATE A PLATFORM WERE THE HOST COUNTRY IS BENIFETED CAN ALSO BE STATED AS LIBERLISATION RESULTING IN GLOBALISATION GLOBALISATION FURTHER RESULTS IN EXPOSURE OF THE HOST PROVIDING OPPORTUNITIES

STRATEGY USED n

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Diversification is the type of MARKETING Strategy used by the Multinationals firms as it allows them to play with different products in different markets But there are some who believe in just to walk along the line. For eg: Macdonald’s , FedX, etc.

IMPACT ON COUNTRIES: n n n n n n n n n n

A large amount of tax collected through mnc’s . Increased revenue. Economic health improved . Employment increased. Foreign relation increased. Foreign currency maintenance and dealing efficiency increased . Market sentiments improved. Demand supply scenario balanced. Available resources used effectively and generate income for countries and other domestic companies. Import export policies implemented effectively and export increased so country benefited in dual mode.

Work out before setting up: n

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Technical Analysis of all sites available in those countries. Entry in SEZ of these country. SWOT Analysis of offered products/business . Determining risk and return portfolio. Segmentation according to their culture/lifestyle/environment. Duties payable on transactions , etc.

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A mnc gives many advantages to domestic companies through purchasing of raw material and resources. a country benefited in term of employment and economic health help to reforms . a new company uses mnc’s network to expand their business. Industrial growth and gdp Effected so, mnc’ become a milestone in developing countries.