About Transnational company
Should the Kenyan Government encourage TNCs to invest in Kenya?
Globalization is the process by which businesses or other organizations develop international influence or start operating on an international scale (Capital, 2013). Globalization has increased the production of goods and services, for instance the biggest companies are no longer national firms, but transnational corporations with subsidiaries in many countries. Transnational Corporations (TNCs) are companies with branches in many different countries worldwide. They have their headquarters in their country of origin, and many manufacture their products in LEDCs. Examples of TNCs include Nike, Wal-Mart and Microsoft. They often locate their factories in countries that are not as economically developed because labour is cheaper. By doing this a TNC is able to benefit since developing countries usually don’t have any system of a national minimum wage. This means that if costs are low, profits should remain high which can be used to either reinvest in a product or improve technology. The target of this investment is to crush all local or lesser companies hence becoming the dominant corporation, in this case Coca Cola Company. It’s an American multinational beverage corporation, retailer and manufacturer which is headquartered in Atlanta, Georgia. Presently it operates in more than 200 countries. In Kenya Coca cola’s foot print spans over 60 years ago. It has established seven bottling partners that manufacture, package and distribute their beverages namely, Nairobi Bottlers, Coastal Bottlers, Equator Bottlers, Mount Kenya Bottlers, Rift Valley Bottlers, Kisii Bottlers and Beverage Services Kenya (High Beam Business, 2014).
The operation of many TNCs in Less Developed Countries is often controversial. Nonetheless Coca Cola has demonstrated to be beneficial to Kenya. Internationally, Coca cola has a long record of associating itself with sporting activities. For example it sponsored the FIFA world cup
Globalization is the process by which businesses or other organizations develop international influence or start operating on an international scale (Capital, 2013). Globalization has increased the production of goods and services, for instance the biggest companies are no longer national firms, but transnational corporations with subsidiaries in many countries. Transnational Corporations (TNCs) are companies with branches in many different countries worldwide. They have their headquarters in their country of origin, and many manufacture their products in LEDCs. Examples of TNCs include Nike, Wal-Mart and Microsoft. They often locate their factories in countries that are not as economically developed because labour is cheaper. By doing this a TNC is able to benefit since developing countries usually don’t have any system of a national minimum wage. This means that if costs are low, profits should remain high which can be used to either reinvest in a product or improve technology. The target of this investment is to crush all local or lesser companies hence becoming the dominant corporation, in this case Coca Cola Company. It’s an American multinational beverage corporation, retailer and manufacturer which is headquartered in Atlanta, Georgia. Presently it operates in more than 200 countries. In Kenya Coca cola’s foot print spans over 60 years ago. It has established seven bottling partners that manufacture, package and distribute their beverages namely, Nairobi Bottlers, Coastal Bottlers, Equator Bottlers, Mount Kenya Bottlers, Rift Valley Bottlers, Kisii Bottlers and Beverage Services Kenya (High Beam Business, 2014).
The operation of many TNCs in Less Developed Countries is often controversial. Nonetheless Coca Cola has demonstrated to be beneficial to Kenya. Internationally, Coca cola has a long record of associating itself with sporting activities. For example it sponsored the FIFA world cup
References: Nyakreal, E. (2013, June 13). Coca-Cola | KenyaYote. Retrieved April 5, 2014, from http://www.kenyayote.com/coca-cola/ Ogunsanya, G