The Store at The World Retail Congress in Barcelona


Max For The World


Men take to the malls in India


Asians Buy Brands

Well no news there…with sales falling in their home markets the growth areas for the luxury brands are China and India. But that is not the brands I am taking about. I’m talking about buying brands. Today as widely expected Tarta, India’s biggest vehicle maker, will announce that it has been out shopping for famous international brands and will be bringing home a basket, full to overflowing, with Jaguars  and Land Rovers. These quintessential British icon brands, once the pride of the world class British motor industry in an age long gone and most recently part of the American giant Ford, will have new owners and I suspect a proud nation behind them. In a motor stable that will now include the widest spread of any manufacturer from super luxury to the Nano, priced at  just £1,250 the world's cheapest car, launched this January.

This is an unstoppable trend and something that the World needs to get accustomed with - emerging markets buying big, international, consumer centric brands. Both China and India will be large players in this game. This is not new, in 2005 Lenovo of China purchased IBM’s PC division and the Think Pad brand. Now it is the fourth largest personal computer manufacturer in the world. Lenovo will, I have no doubt, come of age as a brand to the world at this years Olympics where they are a top level sponsor. The road is not perfect in such acquisitions with such examples of the acquisitions by Chinese TCL of German Schneider in 2002 and of the purchase of the assets from Thomson (TMS) in France in 2004 neither of which can be categorised as a success…but as with everything in the developing markets they learn quickly from it and move on.

And with such acquisitions comes instant access to markets and skills that are not the traditional strengths of these developing nations and companies such as design, innovation and marketing. The net result will be an acceleration of their movement up the value chain and a strengthening of their position in both the domestic and overseas markets.

The current credit crunch will turn out to be a trend accelerator in this case as both Chinese and Indian companies will have greater self generated cash and access to capital in the coming months, the exact opposite of most western centric companies - this at a time when more western centric companies will need to raise cash - fast.

Retailers, whilst not obvious choices for acquisition, will not be immune to the lure of Asian capital. Start constructing your shopping list now.... Any innovative thoughts on what should be on it? Drop me a quick e-mail with your suggestions and why.


David Roth