Ask me about “emerging markets” and chances are, I’ll talk about what’s new in ready-to-go packaged meals or side dishes.
But not this time. In May, Pittsburgh’s H.J. Heinz Company noted that emerging global markets accounted for 19 percent of the company’s FY 2008 sales (which totaled a record $10 billion-plus). What’s more, Heinz said emerging markets represent one of four companywide “growth pillars” and are expected to contribute annual sales growth in the high teens, accelerating to 20 percent of the company’s sales within five years.
Last month, Nestle S.A. officials also discussed emerging markets during the company’s annual investors meeting in Vevey, Switzerland. The Dow Jones news service quoted Chief Executive Paul Bulcke, who noted that Nestle operations in emerging markets (with references to Brazil and China) are developing and contributing profitable growth and will be key to future success.
If your company is active (or even interested) in foreign markets, I want to call your attention to two interesting resources.
First, I recommend the Global Cold Chain Alliance (www.gcca.org) and its affiliate, the World Food Logistics Organization. During the American Frozen Food Institute’s recent annual Distribution & Logistics Conference, association reps Bill Hudson and Corey Rosenbusch spoke about their groups’ (1) partnerships with global warehouse associations (2) relationships with global frozen food processing and retailing groups and (3) strategic work with the U.S. government and major charitable organizations (to establish the cold chain in emerging markets and developing countries).
Food processors may join GCCA as a “supporting partner” and link into everything from in-country warehouse alternatives to the latest in cold chain development projects in more developing nations.
If you’re not already aware, Chicago’s A.T. Kearney Inc. (www.atkearney.com) also publishes an annual list if the most attractive retail market destinations. The firm’s Global Retail Development Index (GRDI) ranks countries based on a set of 25 variables including economic and political risk, retail market attractiveness, retail saturation levels, and the difference between gross domestic product growth and retail growth.
In its seventh annual report, A.T. Kearney said last month that Vietnam ended India’s three-year reign as the most attractive emerging market destination for retail investment. GRDI study authors noted that the much larger markets of India, Russia and China – ranked second, third and fourth respectively – remain important, although increased competition and high real estate costs (in large cities) are slowing growth opportunities.
Here are a few additional notes from A.T. Kearney’s June report:
- “With seven countries among the top 20 in the 2008 GDRI, the Middle East/North Africa region is clearly the world’s hottest region for retail expansion.”
- “Prospects for retail expansion in Latin America, led by Brazil, grow stronger as political and economic stability return to the region."