Asian brand owners plan to invest

07 November 2011

HONG KONG: Brand owners in Asia Pacific expect to boost their investment in innovation, green products and foreign expansion going forward, a study has found.

PricewaterhouseCoopers, the business services firm, polled 320 CEOs, and revealed 96% were optimistic about revenue prospects in the next three-to-five years, including 57% that were "very confident".

Another 44% of the panel suggested improvements in spending power currently being witnessed across Asia constituted the "single biggest" opportunity for growth available to their company.

"It is exciting to see that people are living better, average household incomes are rising and an increasing number of families are moving into the middle class bracket. The retail industry as well is expected to grow significantly," said Scott Price, CEO of Wal-Mart Asia.

China was the leading investment destination for 44% of corporations, topping the US on 10%, Australia and Singapore on 6%, Indonesia and Peru on 4%, and Hong Kong and New Zealand on 3%.

More specifically, 55% of enterprises are allocating resources to meet rising consumer demand in China, ahead of the US, posting 12% on the same metric.

A further 27% of businesses plan to establish R&D centres in China, as do 20% in America and 12% in Singapore. Managerial investments in China were a priority for 30% of firms, with the US on 15%.

Elsewhere, 94% of respondents also argued their innovation models would soon change, and 90% believed pursuing "open" collaboration with partners and suppliers may prove equally transformative.

"We're going to have to think more in terms of collaborations and co-creations whereby people will join together with various different areas of expertise in order to solve the very complex problems that we're facing," said Deborah Henretta, group president, Asia for Procter & Gamble.

Indeed, 78% of participants intended to substantially increase their investment in green processes, products and services, behind the 86% doing so in activities like enterprise mobility and cloud computing.

Corruption was among the main obstacles outlined by companies, mentioned by 86% of the sample, beating inconsistent regulatory regimes on 89%, talent shortages on 85% and protectionism on 86%.

"I would love to see a growing, vibrant ... region that is pursuing economic integration, removing excessive regulation, and adopting free trading principles that should help lift markets by providing access to more of the goods and services that companies like FedEx provide," Michael Ducker, COO, President, International, FedEx Express, said.

Data sourced from PricewaterhouseCoopers; additional content by Warc staff