Domestic companies producing fast-moving consumer goods still have a long way to go before they become competitive internationally both in terms of sales and market share, industry officials said.
AC Nielsen , a top market-research firm, conducted a survey recently to study the global presence of more than 200 consumer brands in such industries as beverages, tobacco, food and home utilities.
The study selected 43 brands from 23 manufacturers, which, it said, were qualified as "truly global" products.
The findings were based on data received from 30 countries and regions in the Asia-Pacific, North America, Europe, the Middle East, Africa and Latin America, which reportedly account for 90 percent of the world's gross domestic product.
AC Nielsen set three criteria for the "Billion Dollar Brands":
- Annual sales of at least US$1 billion over a 12-month period ending in March;
- Presence in all the regions surveyed;
- At least 5 percent sales realized outside the brand's home country.
The survey found that not a single Chinese brand met the criteria.
"None of the Chinese brands can be described as a true multinational brand," said Alistair Watts, managing director at AC Nielsen in China.
"The problem here is that while many goods are manufactured here, very few are sold under Chinese brand names, while they are also not packaged household goods that we measure."
Watts noted that China has to leverage its manufacturing excellence to build global brands. Coca-Cola topped the list with global annual sales reaching US$15 billion - one tenth of which is realized in the Asia-Pacific region. Pepsi-Cola ranked third with its annual sales exceeding US$5 billion.
"Chinese beverage makers are still competing with foreign brands at home," said Zhao Yali, secretary general of the China Soft Drink Industry Association. "It's hard to predict when they will be able to look overseas and compete abroad."
Zhao noted that the higher brand value of international products enabled them to rely on local franchises to grab foreign markets quickly.
At present, industry officials here are skeptical of a sharp growth of domestically produced fast-moving consumer products in the international market.
Most of them, including Philip Kotler, the guru of modern marketing with innumerable books on the subject to his credit, saw a better future for Chinese-made products like home appliances, cameras and electronic products in the international arena.
"China-made home appliances offer much lower prices," said Xu Jun, analyst with China Securities. "They can compete abroad because lower labor costs at home help them to keep prices down."
(eastday.com November 12, 2001)
