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Multinational companies view the entire world as their potential ______.
market
Some multinational companies offer ______ products or services across different markets and regions.
uniform
Multinational companies use ______ hiring policies throughout the world but are also culturally sensitive to host countries.
consistent
Multinational companies have to balance an ______ perspective with a local outlook.
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Multinational companies distribute, produce, price, and promote with an ______ outlook and a local perspective.
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In indirect exporting, a company sells its products in a foreign market without any special ______ for that purpose.
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Direct exporting is a market entry strategy in which a company actively seeks and conducts its own ______ activities to sell products in foreign markets.
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A management contract is an agreement under which a company sells only its ______ skills.
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A multinational company conducts business in ______ countries.
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Multinational companies have a ______ market view.
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Multinational companies often have ______ products.
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A characteristic of multinational companies is having business operations in ______.
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Multinational companies are also known as ______ corporations.
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Multinational companies operate in ______ than one country.
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Multinational companies have a ______ presence globally.
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Multinational companies are organizations that conduct business in ______ countries.
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A _______________ strategy is an approach in which a company primarily focuses on maintaining a presence in multiple foreign markets while keeping its products, services, and business operations largely the same as in its domestic market.
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In a _______________, one person has complete control and decision-making authority.
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A _______________ is a type of business structure in which two or more individuals or entities join together to manage and operate a business.
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A corporation operates as a legal entity separate from any of the _______________.
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In a transnational strategy, businesses try to find a balance between the need to reduce _______________ and the need to meet local preferences.
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One of the advantages of a sole proprietorship is _______________.
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In a partnership, shared _______________ is one of the advantages.
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One of the disadvantages of a sole proprietorship is _______________ liability.
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Study Notes
Characteristics of Multinational Companies
- View the entire world as their potential market, seeking product ideas through foreign subsidiaries and obtaining raw materials on a global basis.
- Offer standardized products or services across different markets and regions.
- Use consistent hiring policies worldwide, but are culturally sensitive to host countries, recruiting managers internationally.
International Business Strategies
- Indirect Exporting: selling products in a foreign market without special activity.
- Direct Exporting: actively seeking and conducting export activities to sell products in foreign markets.
- Management Contracting: selling management skills to companies in other countries.
- Licensing: producing items for companies in other countries.
- Franchising: duplicating business models in other countries.
- Turnkey Operation: providing a complete, ready-to-operate business to another company.
- Wholly-Owned Subsidiary: owning a subsidiary in another country.
Corporations
- Advantages: access to capital markets, professional management, employee benefits, centralized management, credibility.
- Disadvantages: costly, potential for conflict, complex decision-making, regulatory compliance, lack of privacy.
Other Forms of Business Organization
Municipal Corporation
- An incorporated town or city providing services to citizens, such as public safety, public health, local governance, licensing and permitting, and welfare and social services.
Nonprofit Corporation
- Groups created to provide a service, not concerned with making a profit, examples include Philippine Animal Welfare Society (PAWS), Sagip Kapamilya (ABS-CBN Foundation), Philippine Red Cross, American Red Cross, and UNICEF.
Cooperative
- Characteristics:
- Member ownership and control
- Democratic governance
- Voluntary and open membership
Multinational Corporation
- Conducts business in several countries, examples: multinational companies.
International Strategies
- Transnational Strategy: balancing cost reduction with local preferences.
- International Strategy: maintaining a presence in multiple foreign markets while keeping products, services, and business operations similar to the domestic market.
Forms of Business Ownership
Sole Proprietorship
- Advantages: simplicity, complete control, tax benefits, direct ownership, low start-up costs, privacy.
- Disadvantages: unlimited liability, limited capital, limited expertise, workload, continuity issues, limited growth potential.
Partnership
- Advantages: shared responsibilities, diverse skills and resources, access to capital, flexibility.
- Disadvantages: potential for conflicts, profit-sharing, management roles, exit strategies, personal conflicts.
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Description
This quiz covers the characteristics of multinational companies, including their global market view and standardized product offerings.
