Mark Barnes, KPMG’s Global Head of Growth Markets provides a perspective on the challenges and opportunities facing manufacturers in the High Growth Markets.
You don’t have to be a rocket scientist to know that manufacturers are looking to India, China and ASEAN as their next growth opportunity. All three markets, if you count the 10 countries that make up ASEAN as a single market, will continue to serve as global economic growth engines for the foreseeable future.
Traditionally, these markets have been viewed solely as low-cost manufacturing destinations, an opportunity for large multinationals to manage their bottom line. Increasingly however, we are seeing the boardroom conversations shift to focusing on the markets themselves.
This is not only a truism for ASEAN; it is also good advice for any manufacturer engaged in (or considering) an emerging market strategy. Each market is significantly different – ASEAN is made up of 10 different countries with different tax incentives, costs and infrastructure; Africa is made up of 54 vastly different countries – and manufacturers would be ill-served taking a ‘common’ strategy to different emerging markets.
Our experience suggests that the most successful companies are those that create a unique, yet very robust and dynamic strategy for each market, taking into account political, economic, cultural, social and regulatory realities on the ground, to ensure they are maximizing their investments to the fullest.
Q: What is the greatest threat to growth for manufacturers in high growth markets today?
Mark: Economic uncertainty.
Q: What are high growth market companies doing differently do drive growth
Mark: Untethered entrepreneurship.
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