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Global Business: Understanding Transnational and Global Companies

Learn about transnational and global companies, their development, advantages, and disadvantages, and the impact of global marketing strategies. Discover the importance of understanding local cultures and markets for successful global expansion.

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Global Business: Understanding Transnational and Global Companies

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Presentation Transcript

  1. Global Business Get ready for questions after each main section!

  2. Transnational companies • Trans sell goods to a few countries wheras global companies sell around the world. • E.g Dell and CRH (HQ Dub but branches in 28 other countries) • Why have transnationals developed; More power Spread Risk Increase sales Advances in ICT and transport To overcome trade barriers E.g Jap cars made in Eng

  3. Adv of Trans.. • Jobs and higher standard of living • New ideas, training, technology etc • Competition can lead to better prices and better quality • Taxes – income tax, corp tax, vat etc build infrastructure • They buy from Irish suppliers

  4. Disadv • Can move to cheaper cost countires • So powerful they put pressure on government • Send a lot of their profits back home • Irish interests might not be their priority

  5. Global Companies • Coca Cola, Nike • Buy materials and labour from the cheapest countries E.G American car made in korea parts bought from Japan designed in Germany advertiment company from the UK

  6. Why have G Companies developed? • Economies of scale (cheaper per item the more u make, buy and sell in bulk) • Mass production technology has improved e.g CAM • Sales, ICT and Transport improved • Deregulation by the WTO: Free open trading. China only relatively recently did not trade with the world.

  7. Global marketing • ICT, SAT TV –Sky, Internet marketing. • Standardized marketing mix e.g Coca Cola • More often the marketing mix is localised(customised) to suit local culture which is more expensive. • Mc Donalds can’t sell beef burgurs in india as the cow is sacred

  8. Global Price • Price depends on local standard of living • Higher transport costs • Might have higher taxes and tariffs • Local competition might be intense

  9. Global Promotion • Standardised approach is cheapest. E.g Coca Cola at the world cup • Usuallly you must localise so it makes sense to youe local target audience. E.g language interpretations, culture, laws. Could offend locals and lose sales

  10. Global Place • Local agents, distributors. E,g Coke have a bottling and distribution plant in ireland. And bottling partner is the nigerian bottling company

  11. Importance of Global marketing • Economies of scale • Research and development can make the quality the best in the world. E.g Sony • If customisation is ignored massive sales can be lost. Need market research of local markets. • Consider local culture or face negative PR.

  12. Questions • Adv and Dis adv of trans and Global companies • Why have they developed? • Explain Global marketing, standardised approach vrs customised and importance?

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