A new report by business advisory firm Deloitte is warning that manufacturers must tailor their products, pricing and strategies specifically to Asian, Eastern European and Latin American countries, if they are to realise the enormous potential of these emerging economies.
More than half of global manufacturers (56%) expect to substantially grow revenues in emerging markets over the next three years, with nearly three-quarters anticipating significant increases in China. However, just 29% of the companies surveyed currently enjoy higher margins in emerging markets than in developed ones. Of those that do, 54% are providing different product features to the ones offered in their home markets. Jane Lodge, UK manufacturing industry leader at Deloitte, said 'Long-term success requires more than simply tinkering with existing products, lowering prices, and developing new sales channels. Manufacturers must understand the unique needs of each local market and develop new offerings accordingly.' Key to achieving success in emerging markets appears to be research and development (R&D) - 49% of the companies selling new products conducted the R&D locally. The executives cited the 'need to understand the local market', 'faster time to market' and 'lower R&D costs' as the top three reasons for investing in local facilities. For a free copy of the Innovation in Emerging Markets: Strategies for Achieving Commercial Success report, please visit www.deloitte.com/manufacturing . Related links:Today's top stories