Analysis and Asses the Challenges International Companies Face in China Free Essay Example, 2500 words

A large number of foreign companies, particularly consumer goods companies, position their products targeting the biggest and most sophisticated markets, such as Beijing and Shanghai. A number of global companies like the FMCG majors Coca-Cola, Nestl , and Procter Gamble are having good success having touched billion-dollar sales with this strategy. But other foreign companies have found or still finding it extremely difficult to cross even the break-even cost. It is such a difficult situation for the companies. Foreign companies will continue to target and strive in the premium segment as the market is still growing and margins are big enough to earn a reasonable return and also it is easy for them to strike a perfect or in other words easy communication with the elite segment. But whether foreign players have already hit the $1 billion mark or are still striving for their first $100 million, many companies expect big growth in the much larger middle- and lower-income segments, wh ich account for 90% by volume of China's entire consumer goods market. (forbes. com, 2004). The local companies just follow selling the concept and just have the strong communication advantage and nothing else. We will write a custom essay sample on Analysis and Asses the Challenges International Companies Face in China or any topic specifically for you Only $17.96 $11.86/page Meanwhile, the Asian world was offered the empty promise, "Pepsi will raise your ancestors from the dead! " (Wadharmi).