International trade has existed for centuries. Over the years, there has been a constant growth in international trade. The globalization of markets highlights the growth of a global business. A good international relationship is one of the significant factors that have facilitated globalization. Multinational corporations are the most important agencies of globalization. The terms multinational corporations refer to companies that have facilities in one or more countries other than their home country. In most cases the headquarters of these companies are located in their respective home country. They may also have other branches in the countries where they carry out their activities. A company can only be considered a multinational if it derives at least a quarter of its profits from abroad. There are approximately eighty-two thousand multinationals in the world. Many theories have been developed on the origin and development, settings and classification of multinational corporations. This article aims to analyze multinational companies. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an Original EssayMultinational corporations engage in the production of goods and services both in the home country and in foreign countries. Companies become multinational when one company, the parent company, has an investment worth more than ten percent of another company, subsidiary located in a country other than the parent company. The investment is known as foreign direct investment (FDI). Multinational companies can produce similar products in all its branches or can provide diversified products depending on the reasons and strategies used in their internationalization. Internationalization is the process by which firms increase involvement in the transfer of products, services, or resources outside their home country and participation in transnational trade. Foreign direct investment is a crucial tool for internationalization. It is one of the fastest growing economic activities in the world. The study of international trade is very intricate and complex. Therefore, it is crucial to classify multinational organizations into different types. There are two main reasons why classification is essential; Categorization reduces the complexity of the multinational organization into a distinctive and manageable number of characteristics. Therefore, it is easy to understand the formation and functioning of a multinational company. The second reason for the classification is to find the best terms in defining multinational companies. Various statements are used to define multinationals. Although they are used synonymously, there are subtle and significant differences in their meanings. Therefore, it is necessary to distinguish different types of multinational organizations and to define specific terms to be used to refer to different types of multinational companies. The classification of multinationals is commonly based on the management mindset, performance and structural formation of the organizations. Based on the managerial mindset, multinational companies are classified into four types; ethnocentric, polycentric, regiocentric and geocentric multinationals. Ethnocentric multinationals are also known as home-country oriented multinationals. Nationally oriented multinationals have a form of centralized management. Headquarters makes all business decisions. The human resources of both the parent company and its subsidiaries are recruited in the company's home country. Ethnocentric multinationals have better coordinationbetween the parent company and affiliated companies, thereby instilling corporate culture and other practices in the host country. There is also effective communication and transfer of technical knowledge. Companies belonging to the typology of ethnocentric multinationals exploit their human resources effectively. In contrast, ethnocentric multinationals may not have the support of the host government, which could lead to poor performance. The other type of managerial mentality is that of polycentric multinationals. They are also known as host-country oriented multinationals. In polycentric organizations, subsidiaries are treated as independent companies. Management policies are adapted to the settings of the parent company. The human resources come from the host country and have the mandate to formulate strategies and guidelines in the interest of the affiliated company. Head offices are left to control the operations of their subsidiaries. Unlike the ethnocentric, the polycentric lacks adequate coordination between the parent company and the subsidiary. However, polycentric multinationals have better productivity power due to employees' understanding of the host country's market and culture. Businesses get government support from the host country, which leads to a higher chance of success. The other type of managerial mentality of multinational companies is that of regiocentric multinationals. Regiocentric multinationals have a decentralized form of management. The management of the branches is independent of the headquarters. Management of subsidiaries may show poor coordination with managers at headquarters. Employees are recruited from different countries that are within the geographic region of the controlled business. The states where HR is hired must closely resemble the culture of the host country. Unlike ethnocentric organizations, regiocentric multinationals utilize a relatively large pool of managers. Therefore, companies can achieve higher profits than ethnocentric type companies. Conversely, subsidiary managers may neglect the company's overall goals, which can impact the entire enterprise. The geocentric or world-oriented multinational is the last management-based type. In this type of multinational companies, management is centralized in the headquarters. Subsidiary companies are under the full control of the headquarters as in the case of ethnocentric multinationals. On the contrary, the human resource is recruited across borders regardless of nationality. Multinationals in this category can leverage maximum profit from both subsidiaries and parent company as they employ internationally experienced workforce with global business expertise. Companies, however, incur high costs for recruiting and relocating staff. They also have to hire recruiting agencies to find and vet the best-suited employees for the global business, thereby incurring additional hiring costs. Based on performance, multinational companies are classified into four groups; multinational, multinational, international, transnational and global. Multinational corporations are multinational companies that adopt a localized marketing strategy. They maximize the responsiveness of local consumers by customizing and adapting products and marketing strategies to meet different national conditions. Companies try to understand the culture of the affected country to exploit its domestic market. Companies of this type have a form of decentralized management. They enable managersof affiliated companies to make independent decisions. Companies may receive support from the host government and encounter minimal resistance from citizens during the period of nationalism as they identify them as their own company. The biggest challenge of this typology is the high cost that companies incur in researching the specific needs and interests of different markets. Furthermore, the budget for formulating and designing marketing strategies for different markets is relatively high. International multinationals are the second type by which multinational companies are classified. International multinationals are companies that join other companies, with similar objectives, in foreign countries to work together. Companies of this type import raw materials and export finished products to their subsidiary countries. They do not have manufacturing facilities in host countries. Management is decentralized, meaning management and headquarters remain in the country of origin. Businesses have therefore streamlined the decision-making process. International multinationals have a diverse market. They thus enjoy a constant income stream. Furthermore, companies of this type do not incur additional costs for building offices and settling production machinery and workforce in foreign countries. However, they are easily influenced by nationalism and misunderstanding of international marketing strategies. Transnational corporations are another type of multinational corporation based on the functionality of the business. Multinational corporations are companies that own manufacturing facilities in foreign countries. They assume foreign direct investment. They are headquartered in the state of the parent company. The headquarters is the hub of a network of interdependent subsidiaries. Affiliated companies may produce brand variants in different countries. They, however, should maintain the overall corporate identity and overall objectives of the business. Because of their decentralized organizational structure, companies of this type enjoy reduced production costs and other functions because they distribute production facilities in areas where labor, raw materials and other resources are readily available. Multinational corporations, however, show little coordination between subsidiaries and the parent company. Furthermore, political situations, language barriers, and cultural differences are also other challenges faced by multinational companies in this typology. Global multinationals are the latest type of multinational corporation classified by business performance. They have a form of centralized management. They have corporate facilities in a dozen countries that are located under a single headquarters, usually in the parent country. Global multinationals view the world as one big market. They operate with absolute consistency; that is, they produce similar products in all their subsidiaries or apply the relevant brand to suit local taste. They also use similar marketing strategies in all host countries. Companies benefit from economies of scale due to high production volume, thus reducing unit costs. Management communication and coordination costs are major challenges faced by global multinationals. There is a need for consultation by HR in different countries on all issues such as taxes and other legal issues, communication barriers, and cultural activities, among others, that impact the global market. Based on the structural formation of the multinational, multinationals are classified into two main types, horizontally and vertically integrated enterprises. Horizontally integrated companies are companies thatthey operate manufacturing plants located in different countries to produce in the same level of production. When an independent company manufacturing a particular product merges with companies providing a similar level of production but from different countries, the companies form a horizontally integrated multinational corporation. The purpose of horizontal integration is to minimize competition, increase productivity, enter new markets, achieve economies of scale, or increase the size of the company. Consolidation occurs in three main forms: acquisition, merger and hostile takeover. An acquisition occurs when one company purchases another independent company. A merger is the consolidation of two separate companies. A hostile takeover is the forced takeover of an independent company. Horizontal integration can lead to oligopoly or monopoly, which is permitted by the governments of different countries. Vertically integrated businesses are organizations that merge to produce different varieties of products. Vertical integration occurs when a company manufacturing a specific product joins with another company from a different country, producing a different product to work together. A company, therefore, imports goods processed by a company from a foreign country and vice versa. For example, a company in country A imports products manufactured by a company in country B and exchanges the two goods, i.e. the initial product and the imported products, in country A and vice versa. Businesses merge vertically for various reasons. First, several companies merge to strengthen their supply chain, thus gaining full control of the industries value. Secondly, casting helps reduce production costs. Since different companies of the same multinational company produce different products, the cost of producing the two products is minimized. Finally, companies merge vertically to gain access to new markets. Therefore vertically integrated multinationals get maximum profit from their products. Several internationalization factors influence owners' and shareholders' decisions to take actions internationally. The drivers of internationalization are factors that trigger the expansion of companies. They include market conditions, production costs and competitive business situations. There are two main types of these factors; Pull factors and push factors. Push factors are also known as country of origin push factors. These are factors that influence companies to invest in foreign countries. Pull factors are elements that attract companies to invest in a specific country. They are also known as host country drivers. Push factors reveal the disadvantages a company experiences by operating only in the home country, while pull factors show the advantages of venturing abroad. The drivers of internationalization primarily suggest the location or direction of expansion. Location is also determined by the motivations behind internationalization. There are four main categories of motivations; market research, resource research, efficiency research and strategic asset research. Market research focuses on the demand aspect. Businesses invest remotely with the intention of providing goods and services to profit from foreign markets. The markets of different countries motivate entrepreneurs and shareholders of specific companies to decide to expand their business abroad. Therefore they admit the importance of venturing into those countries. Market seekers believe that direct presence in the countries where their products are marketable is essential for the company. They believe that foreign investment allows them to promote andexploit new markets, thereby generating more revenue. Furthermore, the establishment of production facilities in foreign countries leads to effective competition between the host country's firms and the multinational. A saturated market and high competition in the home country are some of the main reasons for market research. The next reason that leads to foreign direct investment is the search for resources. Resources are the essential core for the survival of companies that supply goods. The workforce is also a resource in the production sector. Businesses tend to seek low-cost raw materials and unskilled labor to minimize production costs and maximize profits. However, the workforce should be large and motivated. Those seeking resources and pursuing labor as a resource are often manufacturing companies with high effective labor costs. The main reasons why companies invest in foreign countries due to resources are: the desired quantity can be purchased at a low comparative cost or the supply does not exist at all in the home country. The availability of raw materials in the potential host country reduces the cost of these materials. Companies, therefore, invest in these countries to reduce shipping costs. The search for efficiency is the other reason for foreign direct investment. The main objectives of companies seeking efficiency in foreign countries are; exploit the benefits of economies of scale and scope and take advantage of differences in the availability of factors, culture, institutional arrangements and economic systems in different countries. Through foreign investment and expansion, firms have access to low-cost labor and inputs cost; therefore, greater efficiency in their performance. Those seeking efficiency often use factor endowments in developing countries. The factors enable these companies to compete effectively in the international market. Those seeking efficiency seek to reduce the costs of producing and delivering their products to their customers by establishing a physical presence in foreign countries. They also benefit from government incentives and avoid trade barriers as local companies. The strategic search for assets is the last reason that leads to the internationalization of multinationals. Strategic assets are non-tradable assets, i.e. assets that are not exchangeable through market operations. Employee skills, knowledge, and vital supplies, among other things, are examples of resources that strategic resource seekers follow to foreign countries to use for their own gain. Technology is also a strategic asset that asset searchers look for in target countries. Companies gain strategic motivation for asset seeking through the acquisition of foreign companies. Asset seekers may also try to form alliances with other companies to leverage other companies' knowledge. High market competition in the company's home country triggers the reason. Resources are, therefore, essential to strengthen the company and sustain its competitive position. Strategic asset seekers often come from less developed countries and target companies from developed countries with high technological progress. In conclusion, the motivations behind the internationalization of companies are to strengthen and sustain the competitive environment, protect their value and increase profits. The firm's internationalization motivations and strategies depend on unique advantages and resources in the potential host country that provide it with competitive advantages and increased revenue. Different internationalization factors, push and pull factors and reasons for expansion determine the specific advantages,.