Introduction & Background.
Multinational company - in one ; business in countries.
Difficult to know if company is MN as not , not clear from .
e.g., Bayer: -owned; Nestle: ; owns Jaguar. 25 per cent of California banks -owned.

companies become multinational.

Reason 1
- increase of products.
company against problems of market.
e.g. Japanese MNEs found while home economy in economic since the 1990s, US operations did .

Reason 2
into the world market
part of .
e.g. MNEs targeting China: country's large & growing make it very to multinationals.

Reason 3
increased foreign .
protect home market share.
e.g. set up operations in countries of major .
2 reasons:
(1) takes away business from
(2) lets competitors know that if they MNE's home market, face a response.

Reason 4
costs.
set up operations to foreign customer ->
transportation expenses
expense of using middlemen
better to customer needs
take advantage of local .

Reason 5
overcome devices - import and other
e.g. EU Companies outside EU pay taxes on goods to EU. But companies producing goods in EU can to other EU country taxes.

Reason 6
advantage of technology by manufacturing .
than licensing. Although licensing has , giving another firm access to private information such as , , or technological expertise not good.

Conclusion
companies become multi-national because: it companies to produce goods more and distribute them to their customers more and .

Adapted from: International business by A. M. Rugman & R. M. Hodgetts (Prentice Hall, 2000)