Many entrepreneurs use franchising as a means of starting up their own business - this reduces the risk of failure as support and guidance is provided by the franchiser
May grow so large that they become inflexible and difficult to manage effectively
In very large companies employees may feel out of touch ('alienated') from those at the top and it may be difficult to take a personal approach to customer service
They can be very powerful - some of them earn more than some small countries in the course of a year - and can therefore exert quite a strong influence on the governments of host countries - for example, by threatening to close down their operations there
They can be accused of exploiting labour in low wage countries
They may use up non-renewable resources in the host country
Because they are so powerful and able to take advantage of economies of scale, they may force local organisations out of business
Profits go back to the parent company - in which ever country it has its headquarters
All the major functions tend to remain at headquarters so that, in times of difficulty, it is relatively easy for the MNC to close down a subsidiary causing many job losses
A business run by one organisation under the name of another
The franchiser gives the franchisee a licence permitting them to sell goods or services under the franchiser's brand name, usually in return for a share of the franchisee's profits
The franchisee's licence permits him/her to use the franchiser's name, publicity materials, decor, uniforms, etc.
Business organisations owned and run by the state on behalf of the people
Their chairman and board of directors are chosen by the government and are accountable to a government minister who in turn is responsible to Parliament