週
四﹐全球最大經濟體領導人將聚集在韓國首爾舉行峰會﹐他們的主要議題依然會是“全球再平衡”。
“全球再平衡”的主導理念就是改變世界經濟﹐促使其更少地依賴於美國消費者﹐更多依賴中國、德國和其他擁有巨大貿易順差國家的消費者。目標是為全球增長建立更堅固的基礎﹐避免金融動盪。
但對政治家們來說﹐說起來遠比做起來容易。上週末﹐德國財政部長朔伊布勒（Wolfgang Schaeuble）猛烈抨擊美國﹐對一家德國媒體說﹐美國的問題有很多原因﹐德國出口貿易順差並不是其中一個。
政府政策──匯率、利率、稅收和貿易壁壘──的作用自不用說﹐再平衡關鍵還要依賴於公司董事會所作出的決定。
首席執行長們不斷地審視全球﹐試圖看出美國消費者是否真的變得越來越節儉﹐中國經濟實力是否是可持續的﹐歐洲是否注定緩慢增長。從最實際的層面看﹐再平衡關鍵在於他們要成功地將更多商品賣給中國和德國等低消費國家。
芝加哥大學經濟學家、再平衡領先理論家拉詹（Raghuram Rajan）說﹐他們對再平衡起著決定性作用﹐他們是實現再平衡的媒介。
看看這三個公司──美國102年曆史的割草機生產商Briggs & Stratton Corp.﹐德國豪華車製造商寶馬汽車公司（BMW AG）和美國知名服裝零售商Gap Inc.──我們就能知道﹐再平衡必定會比財政部長及他們的經濟顧問們預測的更慢、更複雜、風險更大。
寶馬汽車首席財務長埃希納（Friedrich Eichiner）說﹐你要怎樣說服人們改變行為？這是很難的。
去年秋天﹐20國集團各國在匹茲堡承諾促使增長再平衡﹐但迄今為止幾乎沒有任何有根本改變的跡象。中國和德國並未轉向內需﹐反而在八月份公佈了出口大幅增長﹐雖然兩國的貿易順差與2009年經濟蕭條時大致相似。同時﹐美國貿易赤字相比去年提高了40%。
Katharina Hesse for The Wall Street Journal
寶馬在中國的銷量在今年增長了一倍。汽車生產商擔心過分依賴中國市場。
對公司來說﹐全球的數據令人擔憂。美國消費者佔據全球經濟巨大份額﹐導致其他國家消費更自由消費的消費者很難填補任何缺口。德國和中國年儲蓄利率每減少一個百分點﹐將會帶動消費支出總額增加420億美元。這兩個擁有巨大順差的國家已經承諾推動消費增長。
麥肯錫咨詢公司智庫麥肯錫全球研究所（McKinsey Global Institute）估計﹐相反﹐美國家庭儲蓄利率每增加一個百分點﹐將會減少1000億美元的消費。目前﹐美國消費者將稅後收入的6%用於儲蓄﹐2005年這一比例僅為1%。
上述三家公司都發現再平衡非常困難﹐這一挑戰所涉及的範疇太大。
Briggs & Stratton將業務向中國轉移非常艱難﹐因為中國人很少購買其為美國人製造的產品。而德國對美式割草機來說是個很小的市場。
Gap想要同時在競爭激烈的德國市場和迅速擴張的中國市場擴大﹐需要不同的戰略和不斷的摸索嘗試。
對寶馬汽車來說﹐挑戰在於保持平衡：寶馬汽車在中國很受歡迎﹐公司高層擔心他們會容易受到政府干涉或中國泡沫爆發的影響。
文化限制
Briggs & Stratton期待在中國、德國、印度和其他有增長的地方填補美國割草機銷量的損失。公司首席執行長戴斯科（Todd Teske）說﹐當我看到外國人跪在地上靠手修草坪而不用割草機時﹐我覺得這太瘋狂了。
然而﹐Briggs & Stratton的產品與美國郊區生活方式結合的太緊密了──美國人週六下午除了割草還能幹什麼呢？──因此在向海外擴張時面臨極大的文化障礙。新興的中國中產階級居住在樓房裡﹐而不是獨立的別墅﹐幾乎沒人需要割草機。相對於美國人來說﹐德國家庭平均擁有的草坪面積較小﹐不需要Briggs & Stratton擅長製造的強力氣動割草機。
教訓就是：許多公司迅速轉向海外銷售困難重重﹐因為外國消費者的品味和需求極其不同。
美國房市崩潰的時候﹐Briggs & Stratton在美國的銷量也暴跌。據市場研究公司FactSet Research Systems統計﹐2005年3月到2008年6月期間的14個季度中﹐有12個季度的收入都低於一致的預估值。
中國確實在向某些產品招手﹐但不是割草機。Briggs & Stratton將目光投向農村市場﹐指望中國大力投資農場機械化促進中國走向下一發展階段。這家美國公司對重慶工廠的產品進行了修改﹐從而使其用於稻米收獲和種植。
Briggs & Stratton在中國有以城市為基礎的經銷商銷售發電機和收割機﹐但它需要一批新的農村經銷商。這項任務十分艱巨﹐Briggs & Stratton正在尋找一個瞭解農村市場並與政府關係良好的中國合作伙伴。農民購買政府支持的機器會獲得相當於設備成本90%的補貼。
戴斯科說﹐在中國市場在未來兩年不會有大的起色﹐目前的銷售額不足7500萬美元﹐在未來三至五年﹐中國市場的業務將十分可觀。
兩個市場 兩種戰略
Gap曾嘗試向德國擴張﹐但以失敗告終﹐2004年關閉了德國的10家專賣店。現在它要捲土重來﹐只是這次不是傳統的實體店﹐而是通過互聯網﹐希望能節省成本。
教訓：再平衡有風險﹐並且昂貴﹐因為很多領域都存在固有的激烈競爭﹐因此許多公司都謹小慎微。
Gap執行副總裁派克（Art Peck）說﹐我們從哪裡尋求增長點？我們需要在不同的經濟體和不同的地區利用品牌盈利﹐因為在美國的銷量從經濟衰退開始已經下滑了15%左右﹐美國消費者仍然處於焦慮中。
為填補在美國的損失﹐Gap正著手實施“兩個速度”的海外戰略。在德國和其他歐洲國家緩慢擴展﹐逐步改善其網站﹐使得歐洲消費者可通過本國語言下訂單並以本國貨幣支付。Gap認為﹐依賴於技術會減少在一個緩慢增長、競爭激烈的市場中的金融風險。
Gap對在德國的進一步擴張抱謹慎態度﹐而在中國卻大刀闊斧地推進﹐本週開始將有四家專賣店在上海和北京亮相。
Gap 意識到已經在中國面臨許多競爭﹐包括全球競爭對手H&M和Zara。Gap希望讓自己與眾不同﹐將推出少一些曲線設計的“亞洲款式”（Asian fit）﹐某些商品將以低於競爭對手的價格銷售。許多西方零售商簡單地把在美國或歐洲的價格換算成人民幣﹐或標注更高價格﹐使得牛仔褲和上衣對收入遠不及西方消費者多的消費者來說成為了奢侈品。
然而﹐即使Gap及其他零售商廣受歡迎﹐這對將中國轉變為消費型經濟這一理念發揮了多達作用仍不清楚。
適可而止
加拿大英屬哥倫比亞大學（University of British Columbia）經濟學家海德（Keith Head）及其他兩位經濟學家對美國沃爾瑪（Walmart）、法國家樂福（Carrefour）、德國麥德龍和英國樂購（Tesco）四家西方零售商產生的影響進行了研究﹐結果發現這些零售商實際上促進了中國的出口。這些零售商是十分挑剔的買家﹐因此他們的中國供應商越來越多產﹐國際競爭的能力越來越強。
對寶馬汽車來說﹐再平衡的速度比預期要快。但這家汽車製造商的高官們卻並不為之歡欣鼓舞：他們擔心會過於依賴中國。
教訓：擔心政府干預行動﹐怕對中國的依賴性太強。
今年年初開始﹐寶馬汽車在中國的銷量幾乎翻了一倍﹐達到11.4萬輛﹐使中國成為寶馬汽車第三大市場。同時﹐在美國和德國這兩個更大市場的銷量在從經濟衰退前水平大幅下滑後﹐僅增長了5%﹐總額為33萬輛左右。這正是“再平衡者”一直希望的增長方式。
目前﹐中國是寶馬汽車最大的、利潤最高的四門轎車最大市場。伯恩斯坦研究公司（Bernstein Research）預計﹐寶馬汽車營業利潤的50%都來自中國。寶馬汽車說中國利潤的百分比是更低的兩位數。
寶馬汽車55歲的首席財務長埃希納在其慕尼黑的辦公室說﹐這就像是意外收獲﹐但我們的戰略並不是要依賴於這樣的發展﹐如果這樣的話﹐就會失去在美國和歐洲的重心。
總的來說﹐消費支出僅佔中國GDP的40%﹐相對於美國的70%和德國的56%較低﹐中國家庭將可支配收入的25%以上用於儲蓄。
而中國的富裕階層則大肆消費﹐使奢侈品生產商成為大贏家。根據伯恩斯坦研究公司﹐同樣是年收入超過10萬美元的中國人和美國人﹐前者購買奢侈汽車的可能性比後者高出四倍。
富裕的中國人還追求時尚、包、鞋、香水和其他高端百貨商品。據咨詢公司Bain and Co.﹐中國對這些商品的購買量今年將上漲30%至130億美元左右﹐中國將在2015年左右成為世界第三大奢侈品市場﹐緊隨美國和日本其後。
寶馬汽車高級管理層說﹐100%的增長是不可持續的﹐但寶馬應該計劃達到怎樣的增速呢？20%還是30%？如果過高估計的話﹐公司擔心會遭受業績不佳的突然打擊。
更令人擔憂的是在專制政府管理下做生意的政治風險﹐政府的政策隨時可能發生變化。埃希納說﹐他尤其擔心中國政府可能希望為了推動國內小型車製造商的發展﹐通過節能管制或稅收限制寶馬或其他大型車的進口。
因此﹐寶馬正在減慢節奏。它為中國市場特製一款四門轎車﹐但並不大幅提升其產量以填滿中國的所有訂單。它希望確保美國和德國有足夠的供應量。
寶馬同時也希望美國經濟能以高於悲觀者所認為的速度更快復蘇﹐使得再平衡的必要性沒有首爾峰會領導人所想象的那麼大。寶馬甚至在重新考慮其取消新款大型運動型多功能車的決定﹐這款車主要針對美國消費者。
埃希納說﹐我認為美國儲蓄率在6%或7%的水平是不可持續的﹐一旦美國人重拾信心﹐他們就會消費﹐這是美國人的本性。
四﹐全球最大經濟體領導人將聚集在韓國首爾舉行峰會﹐他們的主要議題依然會是“全球再平衡”。
“全球再平衡”的主導理念就是改變世界經濟﹐促使其更少地依賴於美國消費者﹐更多依賴中國、德國和其他擁有巨大貿易順差國家的消費者。目標是為全球增長建立更堅固的基礎﹐避免金融動盪。
但對政治家們來說﹐說起來遠比做起來容易。上週末﹐德國財政部長朔伊布勒（Wolfgang Schaeuble）猛烈抨擊美國﹐對一家德國媒體說﹐美國的問題有很多原因﹐德國出口貿易順差並不是其中一個。
政府政策──匯率、利率、稅收和貿易壁壘──的作用自不用說﹐再平衡關鍵還要依賴於公司董事會所作出的決定。
首席執行長們不斷地審視全球﹐試圖看出美國消費者是否真的變得越來越節儉﹐中國經濟實力是否是可持續的﹐歐洲是否注定緩慢增長。從最實際的層面看﹐再平衡關鍵在於他們要成功地將更多商品賣給中國和德國等低消費國家。
芝加哥大學經濟學家、再平衡領先理論家拉詹（Raghuram Rajan）說﹐他們對再平衡起著決定性作用﹐他們是實現再平衡的媒介。
看看這三個公司──美國102年曆史的割草機生產商Briggs & Stratton Corp.﹐德國豪華車製造商寶馬汽車公司（BMW AG）和美國知名服裝零售商Gap Inc.──我們就能知道﹐再平衡必定會比財政部長及他們的經濟顧問們預測的更慢、更複雜、風險更大。
寶馬汽車首席財務長埃希納（Friedrich Eichiner）說﹐你要怎樣說服人們改變行為？這是很難的。
去年秋天﹐20國集團各國在匹茲堡承諾促使增長再平衡﹐但迄今為止幾乎沒有任何有根本改變的跡象。中國和德國並未轉向內需﹐反而在八月份公佈了出口大幅增長﹐雖然兩國的貿易順差與2009年經濟蕭條時大致相似。同時﹐美國貿易赤字相比去年提高了40%。
Katharina Hesse for The Wall Street Journal
寶馬在中國的銷量在今年增長了一倍。汽車生產商擔心過分依賴中國市場。
對公司來說﹐全球的數據令人擔憂。美國消費者佔據全球經濟巨大份額﹐導致其他國家消費更自由消費的消費者很難填補任何缺口。德國和中國年儲蓄利率每減少一個百分點﹐將會帶動消費支出總額增加420億美元。這兩個擁有巨大順差的國家已經承諾推動消費增長。
麥肯錫咨詢公司智庫麥肯錫全球研究所（McKinsey Global Institute）估計﹐相反﹐美國家庭儲蓄利率每增加一個百分點﹐將會減少1000億美元的消費。目前﹐美國消費者將稅後收入的6%用於儲蓄﹐2005年這一比例僅為1%。
上述三家公司都發現再平衡非常困難﹐這一挑戰所涉及的範疇太大。
Briggs & Stratton將業務向中國轉移非常艱難﹐因為中國人很少購買其為美國人製造的產品。而德國對美式割草機來說是個很小的市場。
Gap想要同時在競爭激烈的德國市場和迅速擴張的中國市場擴大﹐需要不同的戰略和不斷的摸索嘗試。
對寶馬汽車來說﹐挑戰在於保持平衡：寶馬汽車在中國很受歡迎﹐公司高層擔心他們會容易受到政府干涉或中國泡沫爆發的影響。
文化限制
Briggs & Stratton期待在中國、德國、印度和其他有增長的地方填補美國割草機銷量的損失。公司首席執行長戴斯科（Todd Teske）說﹐當我看到外國人跪在地上靠手修草坪而不用割草機時﹐我覺得這太瘋狂了。
然而﹐Briggs & Stratton的產品與美國郊區生活方式結合的太緊密了──美國人週六下午除了割草還能幹什麼呢？──因此在向海外擴張時面臨極大的文化障礙。新興的中國中產階級居住在樓房裡﹐而不是獨立的別墅﹐幾乎沒人需要割草機。相對於美國人來說﹐德國家庭平均擁有的草坪面積較小﹐不需要Briggs & Stratton擅長製造的強力氣動割草機。
教訓就是：許多公司迅速轉向海外銷售困難重重﹐因為外國消費者的品味和需求極其不同。
美國房市崩潰的時候﹐Briggs & Stratton在美國的銷量也暴跌。據市場研究公司FactSet Research Systems統計﹐2005年3月到2008年6月期間的14個季度中﹐有12個季度的收入都低於一致的預估值。
中國確實在向某些產品招手﹐但不是割草機。Briggs & Stratton將目光投向農村市場﹐指望中國大力投資農場機械化促進中國走向下一發展階段。這家美國公司對重慶工廠的產品進行了修改﹐從而使其用於稻米收獲和種植。
Briggs & Stratton在中國有以城市為基礎的經銷商銷售發電機和收割機﹐但它需要一批新的農村經銷商。這項任務十分艱巨﹐Briggs & Stratton正在尋找一個瞭解農村市場並與政府關係良好的中國合作伙伴。農民購買政府支持的機器會獲得相當於設備成本90%的補貼。
戴斯科說﹐在中國市場在未來兩年不會有大的起色﹐目前的銷售額不足7500萬美元﹐在未來三至五年﹐中國市場的業務將十分可觀。
兩個市場 兩種戰略
Gap曾嘗試向德國擴張﹐但以失敗告終﹐2004年關閉了德國的10家專賣店。現在它要捲土重來﹐只是這次不是傳統的實體店﹐而是通過互聯網﹐希望能節省成本。
教訓：再平衡有風險﹐並且昂貴﹐因為很多領域都存在固有的激烈競爭﹐因此許多公司都謹小慎微。
Gap執行副總裁派克（Art Peck）說﹐我們從哪裡尋求增長點？我們需要在不同的經濟體和不同的地區利用品牌盈利﹐因為在美國的銷量從經濟衰退開始已經下滑了15%左右﹐美國消費者仍然處於焦慮中。
為填補在美國的損失﹐Gap正著手實施“兩個速度”的海外戰略。在德國和其他歐洲國家緩慢擴展﹐逐步改善其網站﹐使得歐洲消費者可通過本國語言下訂單並以本國貨幣支付。Gap認為﹐依賴於技術會減少在一個緩慢增長、競爭激烈的市場中的金融風險。
Gap對在德國的進一步擴張抱謹慎態度﹐而在中國卻大刀闊斧地推進﹐本週開始將有四家專賣店在上海和北京亮相。
Gap 意識到已經在中國面臨許多競爭﹐包括全球競爭對手H&M和Zara。Gap希望讓自己與眾不同﹐將推出少一些曲線設計的“亞洲款式”（Asian fit）﹐某些商品將以低於競爭對手的價格銷售。許多西方零售商簡單地把在美國或歐洲的價格換算成人民幣﹐或標注更高價格﹐使得牛仔褲和上衣對收入遠不及西方消費者多的消費者來說成為了奢侈品。
然而﹐即使Gap及其他零售商廣受歡迎﹐這對將中國轉變為消費型經濟這一理念發揮了多達作用仍不清楚。
適可而止
加拿大英屬哥倫比亞大學（University of British Columbia）經濟學家海德（Keith Head）及其他兩位經濟學家對美國沃爾瑪（Walmart）、法國家樂福（Carrefour）、德國麥德龍和英國樂購（Tesco）四家西方零售商產生的影響進行了研究﹐結果發現這些零售商實際上促進了中國的出口。這些零售商是十分挑剔的買家﹐因此他們的中國供應商越來越多產﹐國際競爭的能力越來越強。
對寶馬汽車來說﹐再平衡的速度比預期要快。但這家汽車製造商的高官們卻並不為之歡欣鼓舞：他們擔心會過於依賴中國。
教訓：擔心政府干預行動﹐怕對中國的依賴性太強。
今年年初開始﹐寶馬汽車在中國的銷量幾乎翻了一倍﹐達到11.4萬輛﹐使中國成為寶馬汽車第三大市場。同時﹐在美國和德國這兩個更大市場的銷量在從經濟衰退前水平大幅下滑後﹐僅增長了5%﹐總額為33萬輛左右。這正是“再平衡者”一直希望的增長方式。
目前﹐中國是寶馬汽車最大的、利潤最高的四門轎車最大市場。伯恩斯坦研究公司（Bernstein Research）預計﹐寶馬汽車營業利潤的50%都來自中國。寶馬汽車說中國利潤的百分比是更低的兩位數。
寶馬汽車55歲的首席財務長埃希納在其慕尼黑的辦公室說﹐這就像是意外收獲﹐但我們的戰略並不是要依賴於這樣的發展﹐如果這樣的話﹐就會失去在美國和歐洲的重心。
總的來說﹐消費支出僅佔中國GDP的40%﹐相對於美國的70%和德國的56%較低﹐中國家庭將可支配收入的25%以上用於儲蓄。
而中國的富裕階層則大肆消費﹐使奢侈品生產商成為大贏家。根據伯恩斯坦研究公司﹐同樣是年收入超過10萬美元的中國人和美國人﹐前者購買奢侈汽車的可能性比後者高出四倍。
富裕的中國人還追求時尚、包、鞋、香水和其他高端百貨商品。據咨詢公司Bain and Co.﹐中國對這些商品的購買量今年將上漲30%至130億美元左右﹐中國將在2015年左右成為世界第三大奢侈品市場﹐緊隨美國和日本其後。
寶馬汽車高級管理層說﹐100%的增長是不可持續的﹐但寶馬應該計劃達到怎樣的增速呢？20%還是30%？如果過高估計的話﹐公司擔心會遭受業績不佳的突然打擊。
更令人擔憂的是在專制政府管理下做生意的政治風險﹐政府的政策隨時可能發生變化。埃希納說﹐他尤其擔心中國政府可能希望為了推動國內小型車製造商的發展﹐通過節能管制或稅收限制寶馬或其他大型車的進口。
因此﹐寶馬正在減慢節奏。它為中國市場特製一款四門轎車﹐但並不大幅提升其產量以填滿中國的所有訂單。它希望確保美國和德國有足夠的供應量。
寶馬同時也希望美國經濟能以高於悲觀者所認為的速度更快復蘇﹐使得再平衡的必要性沒有首爾峰會領導人所想象的那麼大。寶馬甚至在重新考慮其取消新款大型運動型多功能車的決定﹐這款車主要針對美國消費者。
埃希納說﹐我認為美國儲蓄率在6%或7%的水平是不可持續的﹐一旦美國人重拾信心﹐他們就會消費﹐這是美國人的本性。
SOURCE
Bob Davis
Bob Davis
As Global Economy Shifts, Companies Rethink, Retool
hen leaders of the world's largest economies gather for a summit in Seoul this Thursday, their mantra will be 'global rebalancing.'
The idea is to change the world economy so that it relies less on American consumers and more on shoppers in China, Germany and other countries with big trade surpluses. The aim is to build a firmer foundation for global growth and avoid financial instability.
But it's far easier for politicians to talk about rebalancing than to achieve it. Over the weekend, Germany's finance minister Wolfgang Schäuble lashed out at the U.S., telling a German publication, 'There are many reasons for America's problems─German export surpluses aren't one of them.'
While government policies─exchange rates, interest rates, taxes, trade barriers─play a role, rebalancing depends critically on decisions made in corporate boardrooms.
CEOs are scanning the globe constantly, trying to discern whether American consumers are truly becoming thriftier, whether Chinese economic strength is sustainable and whether Europe is destined for slow growth. At the most practical level, rebalancing hinges on their success in selling more goods in lower-consuming nations such as China and Germany.
'They are central to rebalancing,' says University of Chicago economist Raghuram Rajan, a leading theorist of rebalancing. 'They are the agents carrying it out.'
A look at three companies─Briggs & Stratton Corp., a 102-year-old U.S. lawn-mower manufacturer; German luxury car maker BMW AG; and Gap Inc., the iconic U.S. apparel retailer─shows why rebalancing is bound to be slower, more complicated and riskier than finance ministers and their economic advisers suggest.
'How do you convince people to change behavior?' asks Friedrich Eichiner, BMW's chief financial officer. 'It's very difficult.'
The Group-of-20 nations pledged last fall in Pittsburgh to rebalance growth, but so far there is scant evidence of fundamental change. Rather than shift to domestic consumption, China and Germany are reporting big gains in exports through August, though their trade surpluses are roughly comparable to 2009's recession-year trough. The U.S. trade deficit, meanwhile, is up 40% from last year.
For companies, the global math is daunting. The U.S. consumer is such a large portion of the global economy that freer-spending consumers elsewhere won't easily make up any shortfall. Each percentage-point reduction in the annual savings rate in Germany and China─two countries with particularly big surpluses that have pledged to boost spending─would increase consumer spending by a total of just $42 billion.
By contrast, each percentage-point increase in the U.S. household savings rate reduces spending by $100 billion, estimates McKinsey Global Institute, the think tank of the consultancy. U.S. consumers now save 6% of their after-tax income, compared to just 1% in 2005.
Each of the three companies finds rebalancing tricky, illustrating the scope of the challenge.
For Briggs & Stratton, shifting business to China is hard because the Chinese buy few of the items it makes for Americans. Germany, meanwhile, is a small market for U.S.-style lawn mowers.
For the Gap, expanding in the competitive German market and in the fast-expanding Chinese market simultaneously requires different strategies and relentless trial and error.
For BMW, the challenge is maintaining balance: Its cars are such a hit in China that the German company's executives fear they are vulnerable to government interference or a bursting of a China bubble.
The Limits of Culture
Briggs & Stratton is looking to China, Germany, India and anywhere the grass grows to make up for lost U.S. lawn-mower sales. 'It drives me crazy when I see people [overseas] on their hands and knees cutting grass' without power mowers, says the company's chief executive, Todd Teske.
But the company's products are so tightly woven into the fabric of U.S. suburbia─what's more American than mowing the grass on a Saturday afternoon?─that Briggs & Stratton faces steep cultural hurdles to expand abroad. The emerging Chinese middle class live in apartments, not single family homes, so few need lawn mowers. German homeowners have smaller lawns, on average, than Americans, and don't need the powerful gas-driven mowers that are Briggs & Stratton's specialty.
The lesson: It's hard for many companies to quickly shift sales overseas because foreign consumers have very different tastes and needs.
When the real-estate market burst, so did Briggs & Stratton's U.S. sales. Earnings fell short of consensus estimates in 12 of 14 quarters between March 2005 and June 2008, according to FactSet Research Systems, a market research firm.
China does beckon─but not for lawn mowers. Briggs & Stratton has set its sights on the agricultural market, banking on Beijing spending heavily to mechanize farms as part of the next step in China's development. The American company has reworked engines that it produces in its Chonqqing factory, so they could be used in rice harvesters and planters.
Although Briggs & Stratton has a city-based network of dealers in China to sell generators and mowers, it needs a new set of rural distributors. The task is so daunting, Briggs & Stratton is looking for a Chinese partner that knows the rural market and also has an in with the government. Farmers who buy machinery endorsed by the government can receive subsidies of as much as 90% of equipment costs.
'The Chinese market won't move the needle one iota in the next two years,' from current sales of less than $75 million, says Mr. Teske. 'In three to five years, it could be a big business.'
Two Markets, Two Strategies
The Gap tried to expand to Germany once before, but it failed and shut its 10 stores there in 2004. Now it's set to re-enter, only this time via the Internet instead of with bricks-and-mortar stores, hoping to save money.
The lesson: rebalancing is risky and expensive because of entrenched competition in many sectors, so many companies move cautiously.
'Where do we find growth?' says Art Peck, the company's executive vice president. 'We need to monetize our brands across economies and geographies.' That's because in the U.S. sales have dropped by about 15% since the recession and, Mr. Peck says, American consumers remain 'twitchy.'
To help compensate, the Gap is embarking on a two-speed overseas strategy. It is going slow in Germany and other European countries, where it is improving its website so European shoppers can order in their own language and pay in their own currency. Relying on technology, the Gap figures, limits its financial risk in a slow-growth, high-competition market.
Wary of expanding more in Germany, the Gap is pushing hard in China, where it is opening four new stores in Shanghai and Beijing starting this week.
The Gap realizes it is facing plenty of competition already in China, including its global rivals H&M and Zara. It hopes to differentiate itself by offering an 'Asian fit,' with fewer curves, and undercut competitors on price on some items. Many Western retailers simply translate their U.S. or European prices into yuan, or mark them up further, turning jeans and blouses into luxury purchases for consumers who earn far less than their Western counterparts.
But even if the Gap and other retailers are a hit, it is unclear it will make much difference in the idea of turning China into a consumption-led economy.
A study by University of British Columbia economist Keith Head and two others of the impact of four Western retailers in China─Walmart of the U.S., Carrefour of France, Metro of Germany and Tesco of the U.K.─suggests that the stores actually increased Chinese exports. The retailers are such demanding buyers that their Chinese suppliers become more productive and better able to compete internationally.
Too Much of a Good Thing
For BMW, rebalancing is occurring more rapidly than it expected. But the car maker's top executives aren't celebrating: They worry about becoming too dependent on China.
The lesson: Fearing arbitrary government actions, companies are wary of relying too much on China.
Since the beginning of the year, BMW sales in China have nearly doubled to 114,000 vehicles, making it BMW's third-largest market. Meanwhile sales in the two larger markets, U.S. and Germany, have increased just 5% to a total of about 330,000 cars after falling sharply from pre-recession levels. That is precisely the kind of pattern that rebalancers have been hoping for.
China is now BMW's largest market for its largest and most profitable sedans. Bernstein Research estimates that 50% of BMW's operating profits come from China; BMW says that the profit number is a 'lower two digit number.'
'It's kind of a windfall,' says Mr. Eichiner, BMW's 55-year-old CFO, in his Munich office. 'But our strategy isn't to rely on that development. If you do, you lose your focus in the U.S. and Europe.'
Overall, consumer spending makes up just 40% of China's gross domestic product, compared to 70% in the U.S. and 56% in Germany, and Chinese households save more than 25% of their disposable income.
The country's affluent class, though, spends freely, making luxury-goods makers big winners. Chinese who earn more than $100,000 are four times more likely than Americans with the same income to buy luxury cars, according to Bernstein Research.
Wealthy Chinese also hunt for high-end fashion, bags, shoes, perfume and other department store items. Chinese purchases of those items will grow 30% this year, to about $13 billion, according to the consulting firm Bain and Co., which says China will become the world's third-largest market for luxury goods, behind the U.S. and Japan, in the middle of the decade.
BMW's senior management says 100% growth is unsustainable, but how much should BMW plan on─20%? 30%? If it overestimates, the company fears getting hammered in a bust.
Even more daunting is the political risk of doing business in an autocratic government whose policies can change suddenly. Mr. Eichiner says he is especially concerned Beijing may want to give domestic small-car producers a boost by crippling imports of BMWs and other larger vehicles through fuel-efficiency regulations or taxes.
So, BMW is downshifting. While it makes one big sedan especially for the Chinese market, it isn't ramping up production enough to fill all its Chinese orders. It wants to make sure it has sufficient supply for the U.S. and Germany.
The company is also counting on the U.S. to rebound more quickly than doom-and-gloomers think, making rebalancing less necessary than the leaders gathered in Seoul believe. It is even reconsidering its decision to cancel a new large SUV, which was meant mainly for U.S. buyers.
'I don't think the U.S. savings rate is sustainable at a level of 6% or 7%,' says Mr. Eichiner. Once Americans feel confident again, they'll spend, he says. 'It's how Americans are coined.'
Bob Davis
hen leaders of the world's largest economies gather for a summit in Seoul this Thursday, their mantra will be 'global rebalancing.'
The idea is to change the world economy so that it relies less on American consumers and more on shoppers in China, Germany and other countries with big trade surpluses. The aim is to build a firmer foundation for global growth and avoid financial instability.
But it's far easier for politicians to talk about rebalancing than to achieve it. Over the weekend, Germany's finance minister Wolfgang Schäuble lashed out at the U.S., telling a German publication, 'There are many reasons for America's problems─German export surpluses aren't one of them.'
While government policies─exchange rates, interest rates, taxes, trade barriers─play a role, rebalancing depends critically on decisions made in corporate boardrooms.
CEOs are scanning the globe constantly, trying to discern whether American consumers are truly becoming thriftier, whether Chinese economic strength is sustainable and whether Europe is destined for slow growth. At the most practical level, rebalancing hinges on their success in selling more goods in lower-consuming nations such as China and Germany.
'They are central to rebalancing,' says University of Chicago economist Raghuram Rajan, a leading theorist of rebalancing. 'They are the agents carrying it out.'
A look at three companies─Briggs & Stratton Corp., a 102-year-old U.S. lawn-mower manufacturer; German luxury car maker BMW AG; and Gap Inc., the iconic U.S. apparel retailer─shows why rebalancing is bound to be slower, more complicated and riskier than finance ministers and their economic advisers suggest.
'How do you convince people to change behavior?' asks Friedrich Eichiner, BMW's chief financial officer. 'It's very difficult.'
The Group-of-20 nations pledged last fall in Pittsburgh to rebalance growth, but so far there is scant evidence of fundamental change. Rather than shift to domestic consumption, China and Germany are reporting big gains in exports through August, though their trade surpluses are roughly comparable to 2009's recession-year trough. The U.S. trade deficit, meanwhile, is up 40% from last year.
For companies, the global math is daunting. The U.S. consumer is such a large portion of the global economy that freer-spending consumers elsewhere won't easily make up any shortfall. Each percentage-point reduction in the annual savings rate in Germany and China─two countries with particularly big surpluses that have pledged to boost spending─would increase consumer spending by a total of just $42 billion.
By contrast, each percentage-point increase in the U.S. household savings rate reduces spending by $100 billion, estimates McKinsey Global Institute, the think tank of the consultancy. U.S. consumers now save 6% of their after-tax income, compared to just 1% in 2005.
Each of the three companies finds rebalancing tricky, illustrating the scope of the challenge.
For Briggs & Stratton, shifting business to China is hard because the Chinese buy few of the items it makes for Americans. Germany, meanwhile, is a small market for U.S.-style lawn mowers.
For the Gap, expanding in the competitive German market and in the fast-expanding Chinese market simultaneously requires different strategies and relentless trial and error.
For BMW, the challenge is maintaining balance: Its cars are such a hit in China that the German company's executives fear they are vulnerable to government interference or a bursting of a China bubble.
The Limits of Culture
Briggs & Stratton is looking to China, Germany, India and anywhere the grass grows to make up for lost U.S. lawn-mower sales. 'It drives me crazy when I see people [overseas] on their hands and knees cutting grass' without power mowers, says the company's chief executive, Todd Teske.
But the company's products are so tightly woven into the fabric of U.S. suburbia─what's more American than mowing the grass on a Saturday afternoon?─that Briggs & Stratton faces steep cultural hurdles to expand abroad. The emerging Chinese middle class live in apartments, not single family homes, so few need lawn mowers. German homeowners have smaller lawns, on average, than Americans, and don't need the powerful gas-driven mowers that are Briggs & Stratton's specialty.
The lesson: It's hard for many companies to quickly shift sales overseas because foreign consumers have very different tastes and needs.
When the real-estate market burst, so did Briggs & Stratton's U.S. sales. Earnings fell short of consensus estimates in 12 of 14 quarters between March 2005 and June 2008, according to FactSet Research Systems, a market research firm.
China does beckon─but not for lawn mowers. Briggs & Stratton has set its sights on the agricultural market, banking on Beijing spending heavily to mechanize farms as part of the next step in China's development. The American company has reworked engines that it produces in its Chonqqing factory, so they could be used in rice harvesters and planters.
Although Briggs & Stratton has a city-based network of dealers in China to sell generators and mowers, it needs a new set of rural distributors. The task is so daunting, Briggs & Stratton is looking for a Chinese partner that knows the rural market and also has an in with the government. Farmers who buy machinery endorsed by the government can receive subsidies of as much as 90% of equipment costs.
'The Chinese market won't move the needle one iota in the next two years,' from current sales of less than $75 million, says Mr. Teske. 'In three to five years, it could be a big business.'
Two Markets, Two Strategies
The Gap tried to expand to Germany once before, but it failed and shut its 10 stores there in 2004. Now it's set to re-enter, only this time via the Internet instead of with bricks-and-mortar stores, hoping to save money.
The lesson: rebalancing is risky and expensive because of entrenched competition in many sectors, so many companies move cautiously.
'Where do we find growth?' says Art Peck, the company's executive vice president. 'We need to monetize our brands across economies and geographies.' That's because in the U.S. sales have dropped by about 15% since the recession and, Mr. Peck says, American consumers remain 'twitchy.'
To help compensate, the Gap is embarking on a two-speed overseas strategy. It is going slow in Germany and other European countries, where it is improving its website so European shoppers can order in their own language and pay in their own currency. Relying on technology, the Gap figures, limits its financial risk in a slow-growth, high-competition market.
Wary of expanding more in Germany, the Gap is pushing hard in China, where it is opening four new stores in Shanghai and Beijing starting this week.
The Gap realizes it is facing plenty of competition already in China, including its global rivals H&M and Zara. It hopes to differentiate itself by offering an 'Asian fit,' with fewer curves, and undercut competitors on price on some items. Many Western retailers simply translate their U.S. or European prices into yuan, or mark them up further, turning jeans and blouses into luxury purchases for consumers who earn far less than their Western counterparts.
But even if the Gap and other retailers are a hit, it is unclear it will make much difference in the idea of turning China into a consumption-led economy.
A study by University of British Columbia economist Keith Head and two others of the impact of four Western retailers in China─Walmart of the U.S., Carrefour of France, Metro of Germany and Tesco of the U.K.─suggests that the stores actually increased Chinese exports. The retailers are such demanding buyers that their Chinese suppliers become more productive and better able to compete internationally.
Too Much of a Good Thing
For BMW, rebalancing is occurring more rapidly than it expected. But the car maker's top executives aren't celebrating: They worry about becoming too dependent on China.
The lesson: Fearing arbitrary government actions, companies are wary of relying too much on China.
Since the beginning of the year, BMW sales in China have nearly doubled to 114,000 vehicles, making it BMW's third-largest market. Meanwhile sales in the two larger markets, U.S. and Germany, have increased just 5% to a total of about 330,000 cars after falling sharply from pre-recession levels. That is precisely the kind of pattern that rebalancers have been hoping for.
China is now BMW's largest market for its largest and most profitable sedans. Bernstein Research estimates that 50% of BMW's operating profits come from China; BMW says that the profit number is a 'lower two digit number.'
'It's kind of a windfall,' says Mr. Eichiner, BMW's 55-year-old CFO, in his Munich office. 'But our strategy isn't to rely on that development. If you do, you lose your focus in the U.S. and Europe.'
Overall, consumer spending makes up just 40% of China's gross domestic product, compared to 70% in the U.S. and 56% in Germany, and Chinese households save more than 25% of their disposable income.
The country's affluent class, though, spends freely, making luxury-goods makers big winners. Chinese who earn more than $100,000 are four times more likely than Americans with the same income to buy luxury cars, according to Bernstein Research.
Wealthy Chinese also hunt for high-end fashion, bags, shoes, perfume and other department store items. Chinese purchases of those items will grow 30% this year, to about $13 billion, according to the consulting firm Bain and Co., which says China will become the world's third-largest market for luxury goods, behind the U.S. and Japan, in the middle of the decade.
BMW's senior management says 100% growth is unsustainable, but how much should BMW plan on─20%? 30%? If it overestimates, the company fears getting hammered in a bust.
Even more daunting is the political risk of doing business in an autocratic government whose policies can change suddenly. Mr. Eichiner says he is especially concerned Beijing may want to give domestic small-car producers a boost by crippling imports of BMWs and other larger vehicles through fuel-efficiency regulations or taxes.
So, BMW is downshifting. While it makes one big sedan especially for the Chinese market, it isn't ramping up production enough to fill all its Chinese orders. It wants to make sure it has sufficient supply for the U.S. and Germany.
The company is also counting on the U.S. to rebound more quickly than doom-and-gloomers think, making rebalancing less necessary than the leaders gathered in Seoul believe. It is even reconsidering its decision to cancel a new large SUV, which was meant mainly for U.S. buyers.
'I don't think the U.S. savings rate is sustainable at a level of 6% or 7%,' says Mr. Eichiner. Once Americans feel confident again, they'll spend, he says. 'It's how Americans are coined.'
Bob Davis
No comments:
Post a Comment