Multinational companies are becoming increasingly common in developing countries. What are the advantage and disadvantages of this?

Multinational companies are well established in their home country, particularly from Western countries, who are willing to expand their footprint, often choose developing nations. The most common reason is the population and the individual GDP growth. As a developing economy, it has major advantages as well as disadvantages too. One of the finest examples, it hurts the local small scale units, which employs its own people.

First

and foremost, international companies are easily attracted by people due to its brand value, which is projected over advertisements by the top brand ambassador's from various field's

such

as sports and models.

Secondly

, the quality of the product and the standard maintained is comparatively high,

also

a major reason for the warm welcoming. As an example, soft drinks companies in India offered less tasty or no much brand value was easily dominated by Coca cola decades ago. It might be a good sign of healthy competition, but it severely affected the local manufacturers. On the flip side, the major disadvantages of those multinational entities, once well established, they choose to fix the price and it was less compared to regional manufacturers at the time of entry. As an example, Coca Cola was sold at Rs.5 in India, where the local drinks were sold at Rs.6, now the price has increased to Rs.17 and no more competition. In

this

way, multinational industries dominate the local market. As a career path, people always choose multinational entities, which offers the best package and the life style. They

also

offer international on site programs. At the same time, there will be timely lay offs, which most of the people could not afford. As a conclusion, the Government should overlook, while allowing multinational companies, with a set of rules, which can protect people and local industries.