Changing business locations and multinationals
As businesses grow and increase the scale of their operations, operating overseas in several countries becomes a real possibility. For example, for a food takeaway business, this could mean opening outlets in other countries in order to access new markets of customers. Alternatively, for an online business, this could mean developing a website in a foreign language and opening distribution centreA distribution centre stores products in a warehouse or other large building, to be distributed to retailers and wholesalers. in a foreign country.
There are a number of advantages and disadvantages to a business increasing the scale of its operations:
| Advantages | Disadvantages |
| Access to more customers | Increased responsibility |
| Potential for more sales and profit | More risk |
| Potential to grow product range | Potential for failure |
| Increased brand awareness |
| Advantages | Access to more customers |
|---|---|
| Disadvantages | Increased responsibility |
| Advantages | Potential for more sales and profit |
|---|---|
| Disadvantages | More risk |
| Advantages | Potential to grow product range |
|---|---|
| Disadvantages | Potential for failure |
| Advantages | Increased brand awareness |
|---|---|
| Disadvantages |
Multinational companies (MNCs)
The ultimate goal for a growing business that wants to increase the scale of its operations is to compete abroad. Multinational companies or MNCs (also known as transnational corporations or TNCs) are companies that operate in a number of countries around the world.
Some of the biggest retail, technology, food, coffee and soft drinks brands operate in many different countries. These companies often adapt their products to suit consumers in the different countries while keeping their brand image recognisable around the world. For example, a fast food chain might sell beef burgers in the UK or the USA but develop a spicy taco to sell in Mexico. This is often also known as ‘glocalisation’.
