What is a TNC?
A TNC, or Transnational Corporation, is any company that operates in more than one country. For example, the IPhone in your pocket was designed in California, but was manufactured by a Taiwanese company by the name of Foxconn, it could have been produced in Thailand, Malaysia, Singapore, the Philippines or South Korea.
So, your IPhone was designed in america, made in Asia and is now with you in Australia.
This is just one example of a TNC. As you can tell there are several companies that are run all over the world.
A TNC, or Transnational Corporation, is any company that operates in more than one country. For example, the IPhone in your pocket was designed in California, but was manufactured by a Taiwanese company by the name of Foxconn, it could have been produced in Thailand, Malaysia, Singapore, the Philippines or South Korea.
So, your IPhone was designed in america, made in Asia and is now with you in Australia.
This is just one example of a TNC. As you can tell there are several companies that are run all over the world.
Is there a main "boss" of the companies?
Generally, a TNC has a main or head office in one country. This is like the heart of the company, where most decisions are made, and where everyone in control is located. Although there is a head office in the country the company was made in, there are also "mini" offices in different states and countries around the world.
A good example of this is McDonald's. It was founded in California in 1940, however, there are over 34 000 McDonald's restaurants in 119 countries world wide, serving 68 000 000 customers on average per day. This gives us a good idea about the size of some TNC's.
Generally, a TNC has a main or head office in one country. This is like the heart of the company, where most decisions are made, and where everyone in control is located. Although there is a head office in the country the company was made in, there are also "mini" offices in different states and countries around the world.
A good example of this is McDonald's. It was founded in California in 1940, however, there are over 34 000 McDonald's restaurants in 119 countries world wide, serving 68 000 000 customers on average per day. This gives us a good idea about the size of some TNC's.
Where do they manufacture their products?
The key "rules" of TNC's when choosing countries for factories to manufacture products, and finding materials to work with, are:
Will labour be cheap?
Will land and electricity be cheap?
Which country has the best tax deal?
TNC's ask these questions because they want the manufacturing process to be as cheap and tax free as possible. This will allow the company to save money, and make large amounts of revenue from their products.
This is where sweatshops come into the picture. The countries with the lowest possible working wage makes for very cheap labour, which once again means more money for the company.
The key "rules" of TNC's when choosing countries for factories to manufacture products, and finding materials to work with, are:
Will labour be cheap?
Will land and electricity be cheap?
Which country has the best tax deal?
TNC's ask these questions because they want the manufacturing process to be as cheap and tax free as possible. This will allow the company to save money, and make large amounts of revenue from their products.
This is where sweatshops come into the picture. The countries with the lowest possible working wage makes for very cheap labour, which once again means more money for the company.