? ?
BIZCHINA / Biz Who
Coca-Cola aims to make China its largest market
(China Daily)
? ?
BIZCHINA / Weekly Roundup
Xenophobia at heart of product panic in US
By Debasish Roy Chowdhury (China Daily)
Updated: 2007-07-31 15:22
The author Debasish Roy Chowdhury is a senior editor with China Daily
A new bout of food scare has gripped the United States, with the US Food
and Drug Administration urging people to throw away more than 90
different products, made at a Castleberry's Food Co plant, from chili
sauce to corned beef hash to dog food, for fears that they are causing
botulism, a muscle-paralyzing disease.
Seven cases of botulism have so far been reported. Most victims consumed
a hot dog chili sauce made at the company's plant in Georgia that has
been temporarily closed. The recall has been expanded to Canada as well.
Castleberry is owned by Bumble Bee Foods, the largest branded seafood
company in North America. Not China, the land from where many of the
"toxic food and lethal products" in the world supposedly emanate.
The list of product recalls in the US in recent months is almost
inexhaustible: in March, Ford Motor Company recalled new 2008 Super Duty
trucks made in a Kentucky plant after reports of tailpipe fires in the
diesel version of the vehicles; in June, California-based United Food
Group recalled 75,000 pounds of ground beef products as they were
suspected to have been contaminated with E. coli; and in July, Sara Lee
Corp began to recall dozens of its whole-wheat bread brands made at a
Mississippi bakery for fears that they may contain pieces of metal.
But the product scares and recalls the US media seems fixated on are the
ones from China. It is the faulty tires, toothpaste, pet food, seafood
and toys with a China connection that are making all the news, with cover
stories, editorials and television programs harping on how China's
"substandard" manufacturing methods are putting American consumers at
risk, how the factory to the world is actually one big sham, and
proffering ways to keep off products with any trace of China.
China's economic stardom is beginning to unravel - there had to be a
catch, it is all falling into place now.
Scare sells. As a bonus, the China horror story even has a feel-good
subtext - nothing can match American quality; if China makes goods
cheaper than America, now you know how, by cutting corners.
This fear of Chinese products is reinforced by administrative measures.
At the height of the product scare, the US government quickly formed a
Cabinet-level panel to recommend how to guarantee the safety of imported
food and other products. In this self-delusional world of policymaking,
the Castleberrys and the United Food Groups do not exist, it is only the
products coming from outside the US that pose a threat.
Though it was denied that the move was aimed at China, the announcement
came the same day senators heard testimony from quality regulators about
problems caused by the extremely rapid growth of imports from China.
That is really what this is all about - rising imports from China. It is
not the Chinese product scare, what is actually being played out is the
China scare - the antiquated, mercantilist fear of imports that China's
growing economic might evokes.
Chinese exports to the United States last year were nearly triple that of
just five years ago. Chinese exports to US totaled $288 billion while US
exports to China totaled $55 billion.
But according to Cato Institute, Americans have never earned or spent a
higher share of their income in the global economy than they do today. In
2006, what the US earned through exports and income from foreign
investments abroad reached a record 15.6 percent of gross domestic
product. Since China's entry into the World Trade Organization in 2001,
US exports to China have grown from $19 billion to $55 billion, an annual
average growth of 24 percent.
(For more biz stories, please visit Industry Updates)
?? ?? 1?? 2?? ??
?? ?? 1?? 2?? ??
Learn Chinese, Learn mandarin
Updated: 2007-08-07 11:52
This year marks the 80th anniversary of Coca-Cola's entry into China, now
its fourth largest market after the US, Mexico and Brazil.
The world's largest beverage company, which recently launched an $80
million global research center and new China headquarters in Shanghai, is
planning to boost investment in sales infrastructure and product range in
the country, a market that could become Coca-Cola's largest, the company
says.
Doug Jackson, who became president of Coca-Cola China in April, talks
with China Daily reporter Zheng Lifei about his company's goals and
strategy in China.
Q: As the new head of China operations, what's your short-term goal and
long-term vision for the Chinese market?
A: Our goal in the next few years is to sustain the current strong growth
momentum. The non-alcohol drink market grows by 14 to 15 percent a year
in China, and we hope we can outdo the average market performance to
increase our sales volume and market share. We are also planning to
expand our product range and provide more choices for our customers.
We believe that China could become the largest market for Coca-Cola,
however, it is hard to predict when it will happen, but it certainly
will. Our long-term vision is to make China our largest market.
Q: What will be your priority in the coming years, especially in the next
two years? You said recently that you are going to put a significant
investment in infrastructure. Can you be specific about the plan?
A: Yes. I think in the next few years we will continue to invest in the
vendor equipment area. We'll continue to increase our cool drink
equipment across China very aggressively.
While we grow those areas, our bottler is also going to invest in trucks
and distribution facilities and sales people. So we have a huge increase
in the number of sales officers in some of smaller towns and cities as we
open them up or increase their infrastructure.
Of course, we will also invest in our R&D center. We will have about 200
people, up from the current 40. And we will make significant investments
in the next two years in research and development. These are principally
some of the areas where we will be aggressive.
QCoca-Cola has carried out some major acquisitions in America. Does the
company have a similar plan for China, and will the recent dispute
between the French food and beverage company Danone and Wahaha have any
impact on your acquisition plans in China?
A: well, I think in terms of our acquisition plans, we would always
continue to look at everything that happens in the marketplace. There are
many companies involved in our business in China and the non-alcoholic
drink business is very big in the country.
But we are still growing organically. Our sales grew by 18 percent in the
second quarter (in Chinese market). This is huge in terms of volume and a
big organic growth.
If such growth slows then perhaps we would look at acquisitions more
closely, and then look at everything and see if the opportunities stay.
We would certainly keep watching the developments between the companies
you mentioned, Danone and Wahaha.
Q: What kind of companies will you target if you are going to make such
acquisitions? Will the bottling companies or local beverage makers be
your priority?
(For more biz stories, please visit Industry Updates)
?? ?? 1?? 2?? ??
?? ?? 1?? 2?? ??
Learn Chinese, Learn mandarin
