Globalizing Retail: Conceptualizing the distribution-based transnational corporation (TNC)

Publication Type: 
Volume: 
29
Number: 
4
Page Numbers: 
437-457
Month/Season: 
Published On: 
2005

In this article we argue that the retail transnational corporation (TNC) is an entity that merits urgent theoretical and empirical investigation from economic geographers. Using recent theoretical developments that conceptualize TNCs as the complex nexus of intrafirm, interfirm and extrafirm relational networks, we explore the special characteristics of retail TNCs that distinguish them from their manufacturing counterparts, still the predominant focus of interest in the literature on economic globalization. In particular, using Hess's (2004) notion of three different kinds of embeddedness (societal, network, territorial), we explain how it is the necessarily high territorial embeddedness in markets and cultures of consumption, planning and property systems, and logistical and supply chain operations that defines the distinctive theoretical and organization challenge of the retail TNC. In turn, we argue that this high level of embeddedness frequently implies a very different experience of host-market regulation than is found in other sectors. Additionally, we use Dicken's (2000) distinction between `placing firms' and `firming places' to explore how territorial embeddedness of the retail TNC is influenced by its societal embeddedness (home country institutional origins), and how network embeddedness is critical to an understanding of how places/host economies are inserted, reciprocally, into the organizational spaces of the retail TNCs. In particular, we argue that intrafirm management of innovation and knowledge dynamics across highly dispersed store and sourcing operations poses particular problems and possibilities for retail TNCs.