The basic mason for the existence of multi-national companies is the competitive advantage of a global network of production and distribution. This competitive advantage arises in part from vertical and horizontal integration with foreign affiliates. By vertical integration, most MNCs can ensure their supply of foreign raw materials and intermediate products and avoid the imperfections often found in foreign markets. They can also provide better distribution and service networks. By horizontal integration through foreign affiliates, MNCs can better protect and exploit their monopoly power, adapt their products to local conditions and tastes, and ensure consistent product quality.