What Are The Advantages And Disadvantages Of Multinational Companies

“ Globalization has placed new demands on statistical agencies to provide the information necessary to inform policy in today’s increasingly interdependent word economy”(Landefeld & Kozlow, 2003). The term MNC which stands for Multinational Company is widely used to group or categorize large companies and small companies, it can be defined as those company that have production of both goods and services in one or more country excluding the home country of that company. There are approximately around 82.000 Multinational Companies in the world (Edwards, Marginson, & Ferner, 2013). Examples of multinational companies are Apple, Nike, Samsung, Coca-Cola, etc. Those companies are big corporation, so in order to meet with the needs and demands

Even though it is cheap, some companies still mantain their products quality. For instance, Apple components and parts are made in China, but they are all designed in California to control their quality all over the world. Furthermore, low wage labour can lead to profit maximization. Furthermore, access to asian markets, to promote and sell their goods and services. Another advantages is the reduction of transport cost and more resources of raw material. For example Nike, they use mass production to produce their products, even though some of them are presonalised. Most of their merchandise are manufactured in Indonesia but the quality is still the same. This will help them to get in the market and to compete with other brand in Indonesia. Indonesia also famous for it’s richness of raw materials that can be used to produce more (and cheaper) goods and

Is Located in China. China has been a part of World Trade Organization, has a relaxing foreign investment restriction, inflastructure development and China’s economic growth are the highest from the past 30 years (Sepehri, 2007). Since 1980s, Apple Has been partnership with taiwanese company, Hon Hai Precision industry to manufacture Apple’s product in Shenzhen, China (Lazonick, Mazzucato and Tulum, 2013). The larger quantity and the cost of labor in China is cheaper than in the United States. If they manufacture their products in US, it will cost them around $4.2 billion more than it is today (Worstall, 2012) and also logistics obstacle might occur because most of Apple products are manufactured in China, it will be easier for them to assemble it in China (Blodget,