Manufacturers Predict Emerging Markets Will Account For 40% Of Their Global Revenues By 2017

Online, August 28, 2012 (Newswire.com) - Research by Global Intelligence Alliance (GIA) shows that one out of every four manufacturing and industrial companies is investing in emerging markets in order to gain a foothold in future large markets. The reason is clear; manufacturers say they expect about 40% of their global revenues to come from emerging markets by 2017, according to GIA's Business Perspectives on Emerging Markets 2012-2017 Report (Manufacturing & Industrial Results). Yet the majority stumble when they enter emerging markets. Nine out of ten respondents in the research say they would like to have planned and executed their Emerging Markets strategy differently.


In April-May 2012, GIA conducted an online survey amongst business managers at 80 manufacturing and industrial companies. About 40% of those surveyed said that decisions on emerging markets in their organizations were delayed due to lack of information; while over 70% of the respondents doubted the accuracy and completeness of their emerging markets intelligence.

Over the next few years to 2017, manufacturers will continue their focus on BRIC markets, with equal emphasis on Brazil, China and India (27%) and with Russia lagging behind as the fourth highest ranking target emerging market at 19 percent.

South Africa, Indonesia, Turkey, and Vietnam follow the BRIC countries as secondary emerging markets that manufacturers will focus their investment efforts on.

Some of the most important key success factors listed by manufacturers were the [local] distribution and access to customers (41%), localization of products and services (26%) and adapting to local culture (25%).

As for the top threats in emerging markets to 2017, manufacturers in the Business Perspectives on Emerging Markets Report listed competition with local players (38%) as number one, followed by competition by foreign players (33%).

"Emerging markets are more complex than ever. Indeed, there are an increasing number of metrics to consider as the manufacturing industry's complexity grows. In the future, manufacturing networks won't be geographically divided into high tech versus low cost as our Business Perspectives on Emerging Markets Report shows, but will reflect far greater diversity," said Pete Read, Head, Strategic Analysis & Advisory, Global Intelligence Alliance.

"Successful manufacturers will need to develop a habit of asking the right questions and staying flexible in emerging markets, and a taste for risk and a tolerance for ambiguity to continue previous rates of growth. If they are to compete for higher-margin business, companies must also experiment with new ways of working. In short, global manufacturers may need to alter their business models - and their strategic approaches to supply chain management, market intelligence and location selection," continued Read.




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