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| Many roads, but some are superior in the long run Photo: Danny Friedmann |
Many Chinese consumers prefer foreign goods, because they are perceived as safe. Notwithstanding that foreign brands are often victim of being counterfeited.
Now there are at least the following options Chinese foods manufacturers can choose from:
Option 1. Improve the food safety and quality in all the companies of the group, so that the trust of Chinese and overseas consumers will be gained. The good reputation of the brands is in the long term the most valuable asset of a firm.
Option 2. Improve the image of the product by more advertising and product placements in movies so that in the short term consumers will be lured into buying the products;
Option 3. Take-over a foreign brand and sell the same Chinese products under the foreign brands as if they are made abroad. This is penny wise and pound foolish. You might safe some money with a quality fade out or worse, beside the ethical problems the backlash can be huge and irreversible.
However, Bright Food of Shanghai that took over 75 percent of the Australian Manassen Foods, manufacturer of biscuits, fruits and dairy has the ambition to sell Chinese dairy to the Australian market. If they want to have any chance to succeed they might want to pursue option 1, If they do, I would say to them jia1 you2!/ga1 yau2!/加油!/add oil! (but please not in a literal way).
Read Peter Smith and Patti Waldmeier’s article for the Financial Times here.