Impact of MNCs on MSMEs

Abstract:

This study investigated the economic and managerial impact of multinational corporation entry on micro, small and medium enterprises in Vadodara, Gujarat. City-level evidence on this relationship is limited, so a questionnaire survey of 40 enterprise owners and managers was conducted, supported by secondary data from government reports, academic journals and industry publications. Revenue declined for 42.5% of respondents, while 35% reported growth and 22.5% reported no change. The pattern differed by sector: retail had the highest decline rate (3 of 6 firms, 50%) and food and beverage the highest growth rate (3 of 6, 50%), although these subgroups were small. Employment was largely stable, with 85% of enterprises maintaining or increasing their workforce. Improved customer service was the most common response to competition (47.5%), followed by quality improvement (42.5%). The findings suggest that multinational entry produced a varied rather than uniformly negative effect, and that local firms competed mainly through service and quality. The sample was small and cross-sectional, so the results are descriptive and do not establish causation. Impact of MNCs on MSMEs in Vado…

Keywords:

MSMEs,MNCs,Vadodara,Foreign direct investment,Competition

Read this article on GYSJ: https://globalyouthsciencejournal.app/publications/2026/5/46-4