Just TODAY two of our new American clients started projects to LEAVE the USA and focus on selling in China (because that’s where their products are made.)
Is this strategy extreme? Let’s see:
1. No cost efficient way to replicate their China supply chain. They’ve tried and failed in India, Cambodia, Vietnam, Thailand, Philippines and Mexico.
2. Interim projected margins (as a result of #1) are…dismal.
3. Their core products are under attack by sustainable challengers.
4. Growth is obvious and attainable in China at higher retail prices (see #6.)
5. Their partner-producers here are sophisticated, scaled and reputable.
6. They have unbeatable global IP!
7. They have both international and local management.
8. They have deep roots in Asia (cross pollination.)
They are moving forward with a plan that hedges all bets. For them, this trade war has become a “kick in the butt,” rather than a death sentence.
Radical shift in mindset: YES
Most successful brands have resources and can shift in any direction they see fit. So I’m wondering…is “decoupling” from America the future of retail?
#TradeWar #America #China #NewRetail #Adapt