Multinational and Local Company in the electricity supply.
- Grupo Edmar
- Oct 3
- 4 min read
October 3, 2025 - Multinational and Local Company in the Electricity Supply
Nature and Scale of Operation.
Local businesses are typically small or medium-sized and concentrate their operations in a defined geographic area. This allows them to focus on a specific niche or market, adapt quickly to changes, and establish personal relationships with customers and local authorities.
Multinational companies, on the other hand, have a presence in several countries and regions, have more complex corporate structures, and can handle large projects simultaneously. This scale gives them negotiating power with manufacturers, transporters, and governments, as well as the ability to move specialized personnel from one country to another to address strategic projects.
Regulation and Regulatory Compliance.
Electricity supply is regulated differently in each country. A local company must primarily comply with national and state regulations, which often requires shorter permit and licensing processes and a better understanding of the laws in force in their territory.
A multinational, on the other hand, must have legal and technical teams capable of dealing with multiple regulatory frameworks simultaneously: electrical safety regulations, environmental standards, local content requirements, import taxes, and international treaties. This provides expertise, but also greater complexity and administrative costs.
For example, in Mexico, the CRE regulates permits for generation and supply. A local company may know better how to expedite procedures with this authority; while a multinational may need to harmonize its global policies with local requirements.
Access to Financing and Resources.
Multinationals have an easier time obtaining international financing, large-scale credit lines, and partnerships with development banks. This allows them to build large electrical infrastructure (substations, distribution networks, generating plants) and offer attractive terms on long-term contracts.
Local companies, although with less access to global capital, can take advantage of government subsidies and support, local investors, and flexible payment schemes. Furthermore, their less bureaucratic structure allows them to quickly approve smaller projects and carry out urgent maintenance.
Technological Innovation and Knowledge Transfer.
Multinationals are often pioneers in introducing advanced technologies: smart meters, remote grid monitoring, substation automation, and system-integrated renewable energy. They can replicate these solutions from one country to another, reducing implementation times.
Local companies, on the other hand, tend to be more pragmatic: they adopt proven technologies, adapt them to local market conditions (climate, voltages, consumer habits), and offer more personalized technical support.
For example, a multinational company may bring in a state-of-the-art SCADA system, but the local company may be the one to configure and maintain it so it runs smoothly under the real-world conditions of the Mexican network.
Cost-Benefit Balance and Competitiveness.
Choosing between a multinational and a local company isn't just about comparing prices. There are cost-benefit factors to evaluate:
Infrastructure and logistics: Who can install and maintain networks most efficiently?
Staff availability: certified technicians, response times, after-sales support.
Hidden costs: customs, transportation, training, licenses.
Continuity of service: contingency plans, spare parts available.
A multinational company typically offers lower unit prices for large volumes and a comprehensive guarantee; a local company can offer more competitive prices for small or medium-sized projects and faster response times.
Risk Management and Resilience.
For a multinational, risks are geographically diversified: if one country has regulatory or infrastructure issues, it can offset them by operating in others. However, its internal processes may be slow to respond to specific emergencies.
A local company concentrates its risk in a single market, but its proximity and flexibility allow it to respond quickly to unforeseen events: storms, power outages, urgent maintenance requests.
Example: During an electrical emergency caused by a natural phenomenon, the local company can dispatch crews within hours, while the multinational company might require authorization from the parent company to release resources.
Customer relations, trust and brand presence.
Local businesses typically have direct contact with customers: frequent visits, personalized service, and knowledge of customs and business culture. This builds trust and loyalty.
The multinational offers an internationally recognized brand, global standards, and technical support for large projects. This is attractive to multinational corporations and industries looking for suppliers aligned with their global processes.
Practical Cases and Recommendations for Choosing.
Large industrial plant: may require global support, multinational guarantees, advanced technology, and dollar financing.
Local or municipal residential development: You may benefit more from the speed and local knowledge of a local company.
Mixed projects: In some cases, there is collaboration between a multinational and a local company: the former provides technology and financing, while the latter provides execution and maintenance.
General recommendation: Evaluate not only price, but also technical capability, reliability history, response times, and the degree of customization needed.
The decision between a multinational company and a local company for electricity supply must be based on a comprehensive view: scale, regulation, technology, risk management, and customer relations.
At Grupo Edmar , we focus on offering reliable solutions tailored to the Mexican context, with quality standards comparable to those of international companies. If you're looking for technical support and local expertise for your electrical project, we can advise you.
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