Robust demand lifts fortunes of US companies

Resurgent demand in China for better quality and high-end consumer products has boosted the overseas footprint of US retailers and consumer product companies, executives of top US companies said.

Will Song, chairman of Johnson& Johnson in China, reaffirmed that China is one of the fastest growing global markets for the US-based multinational company."We have been present in China for 35 years. China is certainly the key growth engine for our global business growth and the country is becoming an important innovation engine."

J&J reported a solid performance during the second quarter of the year, with its medical devices business reporting double-digit growth. The company's China business includes medical devices, pharmaceuticals, consumer health and vision products. By banking on local innovation and high-end intelligent manufacturing, J&J has been able to foster an open, creative innovation ecosystem in the country.

"The massive growth potential in the Chinese market, fueled by the government's pursuit of high-quality healthcare products and innovation, will continue to build China into a global innovation engine," Song said.

Megan Zhang, vice-president of marketing and store development at Skechers, a US sportswear brand, said the epidemic prevention and control measures of the Chinese government have been a confidence booster for companies. The sportswear brand opened 150 new stores in China during the first six months of this year and has plans to add another 350 stores by the end of this year. The number has been adjusted from the 900 new stores planned originally for this year due to the impact of the pandemic. At present, Skechers has more than 2,700 stores in China.

US beverage and snack company PepsiCo Inc further expanded its product portfolio in the country in June by acquiring Hangzhou Haomusi Food Co Ltd, one of the largest convenience food companies in China. The move is in line with the US firm's commitment to be a leading consumer-centric food and beverage company in China.

Ram Krishnan, CEO of PepsiCo's APAC sector, said the deal is a major milestone in the company's "In China, For China, With China" commitment. "PepsiCo has invested over 53 billion yuan ($740 million) over the last 10 years in China, which continues to be one of our most important markets globally," said the CEO.

Zhao Ping, vice-president of the China Council for the Promotion of International Trade Academy, said that China has been the only market in the world that witnessed a positive growth trend of 3.2 percent in the second quarter of this year. This has been instrumental in the recovery of international consumption enterprises, said Zhao.

The total retail consumption revenue in China in July is almost at the same level as that of last year. As the world's second-largest consumption market, the significance of the Chinese market is irreplaceable and the opportunities are tremendous for international consumer brands given the country's continuous opening-up policies and improving business environment, said Zhao.

Jason Yu, general manager of Kantar Worldpanel China, said that China is a market that international brands cannot afford to ignore."International brands, particularly US brands, cannot afford to miss the growth opportunities in China as it will significantly impact their global business blueprint."

The Chinese fast-moving consumer goods segment has been seeing a recovery of sorts from the second quarter of the year, despite the 2-percent decline during the first half, Kantar said in a report. The sector is likely to witness positive growth in the second half as the epidemic control measures are bearing fruit. There is a strong demand for quality and sophisticated global brands in China, said Yu.