The location advantage that firms will have with respect to becoming multinational is also an important trigger. Ownership advantages can be modelled effectively only when the firm locates abroad (Herrera, 2002). Be it vertical FDI or horizontal FDI a firm that is able to locate a plant abroad or is able to improve market access to its foreign consumer segment or replicate all its domestic side facilities at the foreign location will definitely avail itself of advantages than the rest. In specific what is called the “headquarter services” will be made available to the foreign plant and that too at a lower cost. Here the horizontal motive of FDI adds to the equation as building a local plant for production will be a onetime cost and soon all transportation costs that the company faces with respect to having the production plan in the domestic sector is soon remedied. Operating costs are often reflected to be a greater part of the company financial success or failures and where a company can make a profit in its sales in a foreign country by reducing its operating costs it will indeed think of becoming a multinational enterprise. In the vertical motive of the FDI it can be said that the perspective will now shift to making operating costs lesser for the home market. A country instead of producing goods in its own country can move the production to another country where the costs are much cheaper.