Strengths And Weaknesses Of Mnes

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“A multinational enterprise is a company that is headquartered in one country but has operations in one or more other countries” (Rugman and Collison, 2012). A firm on the other side operates within the national borders of a country. Some firms want to expand, not only in sizes but also in value and market share, by becoming MNEs. This is due to the fact that it can bring remarkable advantages even though is very risky. MNEs perform international business operations named as: Exports and Imports, Foreign Direct Investment (FDI). The first branch includes the goods and services that are produced in a country and sold in another one and vice versa, the second branch consists in equity funds invested in foreign countries. It is when firms begin to use FDI that they become MNEs. MNEs can be reunited in 500 main MNEs that represent around the 80% of all FDI made in the world and over 50% of the entire world trade. Some of these MNEs are…show more content…
There are several techniques in order to evaluate different options; one of the most famous is the SWOT analysis. This analysis consists in analysing the strengths, weaknesses, opportunities and threats of the future of the company through a brainstorm. Another analysis that can be used and compared to the SWOT is the PEST that is focalized on the political, economic, social and technological factors. Furthermore the FSA-CSA matrix is a successful strategy to evaluate advantages of the firm (firm-specific advantages) and the ones of the country (country-specific advantages). The FSA is generally built on product and production process according to technology, distribution. The CSA on the other side is related to the natural resources available in the foreign country, the labour force and cost, and the tradition and cultural
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