Opportunities and challenges faced by multi-national companies in Essay - 1

Opportunities and challenges faced by multi-national companies in setting an appropriate transfer price - Essay Example This strategy creates both the opportunities and challenges to the multinational companies. One of the major challenge that face multinational companies is complying with transfer pricing rules which is a costly affair itself. However, when times are tough, tax laws are adjusted, an aspect that increases the cost of compliance. With every change in the tax laws, the multinational companies had to interpret the law, apply it effectively and change their internal systems (Kuan,  WorldTrade Executive (Concord, & Mass.) 2005). For instance, they have to automate the processes and hire tax professionals who will track these changes on a regular basis. This requires immense spending by these firms. Managing and producing a detailed trail of audit which involve a step by step of the overall process of transfer pricing is demanding and time-consuming (Wintzer 2007). Therefore, many companies that lack effective internal strategies find it difficult to take up this process. In addition, these companies face a challenge of using a third party because they lack an in-depth understanding of their businesses and operations. In some cases, the top officials use this opportunity to embezzle funds from the organization, thereby affecting their positions in the market. Transfer pricing provides an opportunity for the multinational companies to exercise their â€Å"multinationality† (Bakker & Obuoforibo 2009). In case these transfers do not exist, the concept of multinational companies to exist in different markets would not apply at all. Instead, domestic businesses would dominate each local market in the country. Therefore, transfer pricing plays a significant role in enabling these firms to transfer their resources to other countries some of which are used to support struggling subsidiaries which are located in countries experiencing intense

Business strategy report of Vodafone Group PLC Dissertation

Business strategy report of Vodafone Group PLC - Dissertation Example On the basis of strategic management principles, the mission as well as vision of a business firm is formulated. On the further extent, various types of business strategies are formulated, evaluated and implemented on the basis of the principles of strategic management. This dissertation will concentrate on the strategic management of Vodafone Group PLC. The framework of the paper would not only discuss the various types of business strategies incorporated by the company, but would also focus on the new strategies that can be implemented by the firm in the next five years. The learnt from the paper would help the researcher to analyze the business strategies of the company in details. Industry Analysis The industry in which Vodafone PLC is situated is the telecommunications industry. This industry deals with providing long distance communication services through technological means. Till 1982, the telecommunication sector in United Kingdom was in the form of a public owned company named Post Office Telecommunication. The market structure of the broadcasting sector was duopoly in its nature. The two companies that had formed this duopoly were BBC and the Independent Broadcasting Authority. At this point of time, the mobile or internet services did not exist in the market. With time and development of science and technology, the telecommunication sector in U.K. had expanded. ... had expanded. At present, this industry is highly competitive in nature. Its retail sector is much bigger than that of many other industrial sectors. Companies in this sector in U.K. not only earns substantial amount of profit in terms of billion dollars, but also invest a considerable part of their revenue in research and development for new innovations (Papadopoulos, 2011). Profile of the Company Vodafone Group plc, also recognized as Vodafone, is a UK based global company which is involved in the commerce of providing telecommunication services. The corporation was founded in 1991 in Newbury, Berkshire, United Kingdom. However, the concern shifted its headquarters to London, United Kingdom. The ancestor of Vodafone was Racal Telecom (1983-1991). In stipulations of the total financial proceeds spawned as well as the strength of subscribers, the organization is considered as the second largest telecommunication company in the globe, following China Mobile. The company is present in almost 30 economies of the world and carries its business operations in 40 other nations with the help of its business partners. At present, the company is headed by Vittorio Colao (CEO) and Gerard Kleisterlee (Chairman) (Vodafone, 2012a). It provides employment opportunities to around 87,000 citizens across the globe and also, generates income opportunities to numerous business acquaintances of the company. Some of the commodities of the company include mobile telephony, digital television, fixed line and internet services. As of 2012, the net revenue of the organization was ?46.417 billion and had operating earnings of ?11.187 billion (The World Bank, 2012). Although, the company has a hefty position in the marketplace, it still has to deal with