Light at the end of the tunnel?

A regional study recently published by PricewaterhouseCoopers paints a slightly unexpectedly positive picture of the consumption markets of upcoming states. According to experts, most global companies realised before the crisis that long-term growth is more likely to be achieved in these countries. PricewaterhouseCoopers made a forecast of six FMCG sub-sectors until 2011. The past period has been characterised by news about recession and the spreading of the H1N1 virus, while the level of unemployment was rising. However, fast food chains managed to grow and retail chains, such as Wal-Mart, Carrefour, Tesco or Metro still plan expansion. The biggest challenge ahead of the FMCG sector is the proliferation of private labels – the answer of branded products is cutting supply chain and marketing costs. Luxury product manufacturers are in trouble in Central Europe and Russia, since falling oil prices decreased the number of Russian millionaires by 60 percent. However, China and India show promising signs on the luxury market. Electronic appliances, PCs and audio-visual equipment are a declining market – the only exception being Asia, where people keep buying, especially computers and televisions. Recession is grave, but producers and distributors have cash reserves and are not afraid to cut costs. The biggest growth potential is on the Asian market, while consumption in the Central European region may gain momentum in 2010, with Hungary still in recession until 2011. The study is available at www.pwc.com/r&c.