List of Pros of Multinational Corporations
1. Their size benefits consumers.The operational size and scale of these corporations can give them the chance of taking advantage of the economies of scale, which paves the way for lower average costs and prices for consumers. This is particularly important to industries that carry extremely high fixed costs, such as car manufacturers and airlines.
2. They can help a country in many ways.
Multinational corporations have the ability to bring advanced technology to poorer countries, while bringing low-cost products to the wealthier ones.
3. They are cost-effective.
By utilizing labor in parts of the world where the low cost of living does not require high wages for production, these companies can keep consumer costs down. As a result, many industries can also benefit.
4. They can create jobs and wealth.
These global companies’ inward investments offer the much needed foreign currency for developing economies, which in turn help with creating jobs and increasing expectations of things that will likely happen.
5. They help other companies.
Through merger and acquisition, multinational companies can help other commercial organizations with achieving economies of scale in distribution and marketing, allowing well-managed businesses to take over those that are poorly managed.
6. They adhere to the best brand standards.
This is one of the best qualities of these corporations. For example, McDonalds is still McDonalds wherever it is operating in the world. There is a standard that this restaurant chain is expected to adhere to. The same goes to the manufacturing sector, where standards are set and are expected to be adhered to. This builds trust and confidence among consumers, which is then converted to consumer loyalty.
7. They ensure minimum standards.
Somehow connected to the previous pro, the main reason for the success of multinationals is that consumers would usually purchase products and services on which they can go for minimum standards.
8. They help improve standard of living.
Multinational corporations have the capability to improve the world’s standard of living, providing people with access of quality products regardless of the place.
9. Their large profits are consumed for development and research.
Taking into consideration pharmaceutical companies, they can easily afford to pour millions of dollars into their research and development efforts. The same goes for automobile manufacturers and other large corporate entities. Without their global presence and large profit margins, they will not be able to do this. Another good example is oil exploration, which is both costly and risky. As such, only large firms can undertake it by using significant amount of money and other resources.
10. They allow for a wider market.
With these big businesses, huge markets have been created both domestically and internationally.
