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GLIMPSE AT THE GROWING US BOTTLED WATER INDUSTRY | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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USA -- Consumption of bottled waters in the USA has been on the rise since their
introduction to the mass consumer market nearly ten years ago. Some may attribute growth in
the industry to health and safety trends or consumers' refocus on nature (in our digital
world) or a fitness/wellness movement. Some may even correlate this growth with consumer
emphasis on status (first was Perrier, now Gerolsteiner or Sole or Tynant or dozens of other
status brands -- which have come to substitute for or complement an alcoholic beverage in
social settings). Nevertheless, there are over 500 brands of bottled water available to US
consumers today. Consumption in 1995 was close to 2.7 million gallons (twice the volume of 10
years ago), with annual sales reaching US$2.5 billion. Interestingly, in the US, there are 15
states including California, Florida and New York, that consume 75% of bottled water volume.
The majority of Americans consume still water (93%), rather than sparkling/mineral water (7%).
And the average price of a bottle in the US? US$1.39 - 2.00/one-and-a-half liters. The 10 US
market leaders, listed in order of 1995 annual sales (US$ millions), include:
(Source: YOUR LINK HERE)
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COCA-COLA TO BUY NORA BEVERAGES OF CANADA | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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USA and CANADA -- Coca-Cola Enterprises, Inc., the world's largest soft drinks bottler,
which distributes 57% of Coca-Cola's bottle/can volume in the USA has announced plans to acquire
Quebec's Nora Beverages Inc. for about US$117 million. Nora produces Naya brand Canadian
spring water. Coca-Cola is Naya's largest distributor in the world, handling about half of its
worldwide volume.
(Source: YOUR LINK HERE) |
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| EUROPEAN TELECOM MONOPOLIES FORM ALLIANCE WITH SPRINT | S. KOREA ATTRACTS MORE FOREIGN INVESTMENT AND ATTENTION | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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EUROPE -- In a new venture, called Atlas, Europe's antitrust regulator allows Sprint Corp.,
France Telecom S.A. and Deutsche Telekom A.G. (two of the largest phone companies/monopolies in
Europe -- with combined annual revenues of US$61 billion, operating 70 million telephone lines)
to form an alliance for a period of five years. As part of the negotiations, the two European
monopolies were granted this freedom to operate jointly under the conditions that they further
liberalize local telecommunications laws, and allow competitors fair access to state-owned
networks. Full deregulation of both monopolies will take place on January 1, 1998. This is seen
as a positive step towards restructuring and integrating the European telecommunications industry.
See Sprint's Global-One explanation for more information.
(Source: YOUR LINK HERE) |
SEOUL, S. Korea -- Foreign investors are looking at S. Korea differently lately and have
altered their perceptions of the country from that of a production based market, with benefits
of lower wages, to a consumer market, with high potential. This confidence in S. Korea's
business opportunities has attracted more investment from foreign companies. These are the
findings of a survey conducted in July '96 by the Economist Magazine and POSCO
Research Institute. According to 55.5% of the senior executives from 100 foreign firms
surveyed, their subsidiaries in S. Korea were doing better business than in any other country
and 77.8% of respondents said their companies put greater emphasis on operations of their S.
Korean units than in businesses elsewhere.
(Source: YOUR LINK HERE) |
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| FOREIGN INVESTMENT IN VIETNAM MAY BE WANING | GROWING MIDDLE CLASS IN VIETNAM | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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HANOI, Vietnam -- Vietnam, also called The Pearl of the Orient, and considered
one of SE Asia's most promising emerging frontiers, has seen recent foreign investment
slipping. Foreign investment in southern Vietnam's Ho Chi Minh City has dropped by 28% during
the first five-and-a-half months of this year vs. the same period in 1995. Since Vietnam's
opening up in 1988, foreign investments have totalled US$20 billion -- actual disbursements to
date are estimated at around US$4-7 billion. Despite the recent decline, officials in Vietnam
are still optimistic and report a positive trend, and attribute the sharp decline to receiving
one extremely large project last year, valued at US$500 million. The government is also
reportedly becoming more selective about the foreign investment projects it accepts than they
were at the outset -- given the number of projects already underway and the volume of
investments it has already received, they are taking a more focused, strategic approach. MPI
(Ministry of Planning and Investment) released national figures that demonstrate a nearly 40%
drop in foreign investments from 1995 to 1996 (measuring the first 5.5 months of 1995 vs.
1996 -- investments in 1996, so far, have come from 132 foreign projects and
total US$2.075 billion).
(Source: YOUR LINK HERE)
World -- Looking at the leading 26 automobile and light truck manufacturers around the
world, the USA continues to take the lead in global production. In 1994, total world output
was 44,906,051 million vehicles. Of the top 26 companies, the three US leaders
(General Motors, Ford and Chrysler) accounted for 37% of vehicles produced.
Japan represented 30% of output (from nine leaders -- Toyota, Nissan, Honda,
Mitsubishi, Mazda, Suzuki, Fuji, Daihatsu and Isuzu). France's leading auto
makers (PSA/Peugeot and Renault) accounted for 10% of production. Germany
ranked next at 9.6% (lead by Volkswagen, Daimler-Benz and BMW). South Korea,
whose Year 2000 goals from Daewoo are quite ambitious, ranks next with 4.7% of vehicles
(lead by Hyundai, Kia and Daewoo). Then Italy's Fiat, alone,
produced 4.2% of the world's vehicles. The remaining 4.2+% of vehicles manufactured by the
leading auto makers were produced by Russia (Vaz), the UK (Rover Group), Sweden
(Volvo) and Poland (FSM and FSO).
Cameroon -- For the first time in 20 years, Cameroon's trade balance with the rest of the world is positive. Its economy is showing signs of an economic recovery. Leading exports (in terms of revenues) last year included logs, robusta coffee, cocoa and cotton. Domestically, the textiles and clothing industry reported record turnover last year, an increase of 60% over the previous year and significant increases were also noted in the agricultural sector. Manufacturing is one of the most promising sectors, with an expected growth rate of 8% annually. It currently accounts for 12% of the nation's GDP. The World Bank's outlook for Cameroon is also positive with a projected 5% sustained increase in GDP for 1995/6.
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HANOI, Vietnam -- Despite recent evidence of waning investments in Vietnam, the surge of
investments over the last few years, i.e. in construction, infrastructure development, etc. and
accompanying government reforms have attracted significant foreign
money from abroad, giving rise to an emerging middle
class. The growing wealthier/middle class is now working for foreign companies or as
entrepreneurs and they fuel a widening gap between the haves and the have-nots. The average
income for those living in the major cities such as Hanoi and Ho Chi Minh City is estimated to
be 3 - 4 times higher than the rest of the country (estimated average per capita GDP was
US$220 in 1995). This new found wealth can be seen in consumer purchases and leisure
activities. For instance, there is a two-hour wait at the newly opened bowling alley
in HCM City, where a game can cost US$4.36 (the equivalent of 10 servings of noodle soup).
And upscale restaurants and night clubs, once the sole terrain of foreigners, are now
frequented by Vietnamese. In terms of material goods, VCR ownership has jumped from 33% of
households in 1994 to 51% in 1995. Visible evidence of this upwardly mobile group, ranges
from clothing (styles and quality) to transportation means (motor bikes and cars) to lavish
wedding ceremonies at the New World Hotel in HCM City, one of the most luxurious hotels in the
country. More Information
about consumer trends in Vietnam is available in PANGAEA's in-depth country overview.
(Source: YOUR LINK HERE)
South Korea -- South Korea's Daewoo Group ranked 24th out of the leading vehicle
manufacturers in 1994. Their ambitious plan is to rank among the world's 10 largest automobile
producers by the Year 2000, by building two million cars that year. Daewoo has invested heavily
in production facilities in eastern Europe to help facilitate this goal. Specifically, they bid
for and won (against companies such as US' General Motors) the rights to take control of Poland's
Fabryka Samochodow Osobowych (FSO), Poland's state-run car and component manufacturing facilities,
with 20,000 employees -- for US$1.1 billion. This is just a fraction of the US$5 billion they have
invested to date in eastern European manufacturing facilities (in Poland, Romania and the Czech
Republic). Poland, like other nations of eastern Europe, continues to offer low manufacturing
costs (wages are 1/5 of those in S. Korea) and an increasing consumer demand for automobiles.
Consumer car sales rose 30% in Poland and the Czech Republic during the first five months of
1996. Moreover, Poland's central European location serves as a viable gateway to western
Europe, where demand for vehicles is significantly higher. Daewoo is in an aggressive growth
mode, taking risks and employing less traditional marketing techniques. For example, their
Nexia model car launched in Britain and sold 18,000 cars in its first year -- many were sold
through Sainsbury's Savacenter superstores, a supermarket chain, rather than in traditional
car show rooms.
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| US TOBACCO GIANTS SHIFT EMPHASIS TO ASIA FOR PROFITS | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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PR CHINA -- With a restricted tobacco industry in the US (and many developed markets),
tobacco giants look to consumers in developing nations in Asia for profits. Focus on the US$8 billion
tobacco market in China is particularly enticing for US giants, in a country where 300 million men (out
of a more than 1 billion population) already smoke cigarettes, personal income is rising and the image
of smoking American cigarettes conveys status, "coolness," and disposable income for the growing
number of younger smokers. In China, cigarette ads for a variety of brands are evident on television,
in public areas, in print, etc. And the majority of smokers do not yet understand the impending dangers
of cigarette smoking.
(Source: YOUR LINK HERE)
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| .....check back for more news this month! |
For more information about any of these topics in any foreign market, or
if you would like an in-depth market study, contact PANGAEA, International Consultants. With
an extensive network of marketing consultants, attorneys, logistics experts and more around
the world, PANGAEA is uniquely qualified to offer hands-on, local marketing and management
consulting services.
Reprints/copies of this issue are available for US$10.00 per copy.
(c) 1996 PANGAEACommunications. All rights reserved. Materials found on this website
are not for resale. No part of this file may be printed, copied, distributed
or disseminated in part or in whole without the express prior written permission of
PANGAEACommunications
Updated 8/19/96
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