Benefits And Costs That Have Occurred As A Result Of Asda Takeover

1675 Words Jul 12th, 2015 7 Pages
Introduction

Asda was formed by a group of farmers from Yorkshire in 1965. The firm was the third biggest supermarket in the UK before being acquired by Walmart, an American multinational, one of the largest retail chain and the biggest employer in the world. (https://en.wikipedia.org/wiki/Walmart, accessed 20 June 2015). The aim of this assignment is to identify and examine the benefits and costs that have occurred as a result of Asda takeover. However, firstly it will be necessary to define the term 'multinational corporation ' and identify the motives that may lead a company to seek international status.

What is MNC and why companies choose to go international?

A multinational corporation is usually a large corporation which produces or sells goods or services in various countries. (Resource book) Companies go international for a variety of reason, but the goal is typically company growth or expansion. 'Introducing new products internationally can expand a company 's customer base, sales and revenue ... ' (Prezi, 6 October 2013; accessed 21 June 2015). In order to maintain a competitive advantage, a corporation may pursue multinational status to increase market share or reduce production costs, through the acquisition of cheaper labour. MNC’s may also go international to take advantages of tax variations or to reduce it 's domestic tax liability and avoid trade barriers. Under certain circumstances, a company potentially undertake an international market entry not…

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