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Q1

(i) A multinational corporation (MNC), also called a Trans-National Co-operation,(TNC)


or multinational enterprise (MNE),[1] is acorporation or an enterprise that manages production or
delivers services in more than one country. It can also be referred to as aninternational
corporation. The International Labour Organization (ILO) has defined[citation needed] an MNC as a
corporation that has its management headquarters in one country, known as the home country,
and operates in several other countries, known as host countries.

The Dutch East India Company was the first multinational corporation in the world and the first
company to issue stock.[2] It was also arguably the world's first megacorporation, possessing
quasi-governmental powers, including the ability to wage war, negotiate treaties, coin money, and
establish colonies.[3]

The first modern multinational corporation is generally thought to be the East India Company.
[4]
Many corporations have offices, branches or manufacturing plants in different countries from
where their original and main headquarters is located.

Some multinational corporations are very big, with budgets that exceed some nations' GDPs.
Multinational corporations can have a powerful influence in local economies, and even the world
economy, and play an important role in international relations and globalization.

(ii )Product adaptation in new markets


Modifications of the product itself are often required to make the product appeal
more to the market this is the so called product adaptation. It can also be
necessary to make the product safer, more up to date or more useful for a different
target audience, especially on domestic markets. Product adaptation on international
markets it is important to adapt the product to the culture.

Things that can differ in different cultures are the taste of the product, the style, the
colour, or symbols, language, but also more specific like differences in technology,
environmental differences, religion etc. The taste of a product is very important for
the food, drinks and cigarette industry. Style is more important in car and fashion
industry, which also includes the colour and symbols. The meaning of a colour or a
symbol can differ from culture to culture.

The package of the product can also need adaptations. Special symbols and the
language need to adapt to the country/culture. Some symbols can be offensive in
one culture and be normal symbols in another culture. There is also a possibility that
a symbol is not commonly used in a culture and will be misinterpreted. Language
differs of course, many things can go wrong concerning languages or translations.
The packaging also has to be adapted to the conditions of a country; storage
conditions (size of the product), climate, moisture, etc.
Technology can also make a difference if the product is going to be successful on a
new market or not. Measurement systems vary between countries and often
components need to be modified to adhere to local standards, which can also include
the size of the product. Environmental differences are probably more logic; selling
ski jackets in warm countries is not likely to be profitable. Some products may
malfunction, when they are exposed to extreme heat or cold. Religion or special
norms and values can also make a product fail.

Fast Food Chains

Most fast food chains are known for their ability to modify easily, when entering new
markets. McDonalds, for example, adjusts its menu for each foreign market; beer in
Germany, wine in France, mutton pot pies in Australia, and McSpaghetti in the
Philippines. Burger King, Wendys, Kentucky Fried Chicken, they all adapt to the
market they are in 'Product adaptation'.

An exception of this successful trend in fast food chains has been Pop-Tarts, toaster
pastries that have been quite a success in the U.S.. When entering the British
market, they could not set ground there, because the taste was considered to sweet
and most people did not have toasters 'Lack of product adaptation' .

Coca Cola's two liter bottle

When Coca Cola tried to introduce their two liter bottle in Spain, they found out that
market entry was difficult. This was due to local storage conditions; few Spaniards
have refrigerator doors with compartments large enough to accommodate the large-
size bottle.

29-inch tables in Japan


One American company tried to sell 29-inch tables in Japan when the average table
height is 21 inches due to fact that the Japanese sit on the floor at the table and do
not use chairs.

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