Megacity Expansion: A New Path to Growth in China's Urban Markets
Forbes July 22, 2010 By Torsten Stocker, Jennifer Lacks Kaplan
Much has been said and written in the past few years about consumer goods and services companies' desire to expand into so-called lower tier cities in China. The underlying drivers, e.g. increasing wealth, the adoption of consumer lifestyles and the expansion of modern trade, as well as the challenges, i.e. distinct consumer preferences or different local competitors and channels, have been described extensively.
At the same time, smart managers have realized that following the curve of rising disposable incomes along China's city-tiers may not be the most effective, and certainly not the only expansion model.
Instead, leading companies, ranging from household appliance giant Haier and personal computer maker Lenovo to English-language teaching chain Wall Street English and food and beverage company COFCO, are beginning to focus their attention on developing specific growth strategies for so-called megacities. >>