MNCs are spreading production across the world:
1. MNCs set up production jointly with the local companies of that area. This benefits the local companies as the MNC may bring with it better technology and provide money for investment.
2. Most of the times, however, MNCs buy up the local companies to expand production. For example, Cargill Food, an American MNC had bought Parakh Food.
3. Sometimes, MNCs order the product from local producers. When the product like garments are supplied to the MNC, they sell it under their own brand name.
Explanation: MNCs have an international outreach so they organize the production globally such that the efficiency is good and the cost is low.
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