The growth distribution and development of a transnational corporation (Shell)

The growth, distribution and development of Royal Dutch Shell

Shells started off as a transport company based in London, it later merged with a Duch company called The Royal Dutch and became the royal dutch shell company in 1907.

Shell is a transnational corporation (TNC) this means that the company operates in at least 2 countries. The HQ is generally located in the country that the corporation was founded in while remaining assets, mainly the manufacturing plants, are located in LEDCs where labour is cheap and readily available.

This picture shows where shell operates around the world in 2013, today shell is the 5th largest company in the world and revenues a total of $451.2 billion

and gains a profit of $16.5 billion and employing around 100,000 people.

During the First World War, Shell was the main supplier of fuel to the British Expeditionary Force. It was also the sole supplier of aviation fuel and supplied 80 percent of the British Army's TNT this allowed it to sell large quality's of oil to the British and generate a good profit margins, when 17% of the world's oil supply was seized when Germany attacked Poland shell had even less competition and continued to grow and thrive.

One of the ways that has allowed shell to grow in to such a competitive business is that they have heavily invested into other areas of oil such as exploration, shipping and refinery, owning there own drilling rigs made them huge amount of money and really gave them a position in being one of the biggest company in the world because it can refine and mine its produce allowing it to sell it at low rates.

Shell first started to sell and produce oil in the USA, by 1929 Shell gasoline was being sold throughout the United States it had purchased everything that is required to allow it to expand and grow, by the late 1920s the company was actively laying pipeline across the USA to transport oil from Texas to Roxana, Illinois in its Wood River refinery.

In the 1930s as shell invested more into research, it became the leading company is aviation fuel and also helped in the rubber shortage as it was able to produce epoxy resins, ethylene, synthetic rubber which were at a shortage in the war.

One of its biggest successes was the 1983 strike at the Bullwinkle prospect in the Gulf of Mexico. This recovery operation was expected to produce 100 million barrels of oil, now Shell has 9 subsidiary businesses scattered around the world from Hong Kong to Nigeria.

Shell has had huge natural disasters and environmental issues over the past decade however it has done a good job in addressing these issues and doing there best in cleaning up its mess, in may 2016 88,200 gallons of oil was spilled into the Gulf of Mexico causing an oil sheen that was 2 mile by 13 miles long and was visible in the sea about 97 miles off the Louisiana coast.