2014 International Business Predictions

Here are some snippets from various research pieces I have seen recently seen from a wide variety of sources.

MONOCLE magazine publishes an annual soft power survey. They define ‘soft power’ as how well countries project themselves on the global front and influence the world outside the use of military force. Germany is the best of the 30 countries listed and is trending upward. The UK and U.S. are 2 and 3 and trending downward. Japan (5), Australia (7), Canada (9), Italy (10), Singapore (17), Spain (12), China (20), and Mexico (24) are trending upward. Brazil (19), South Korea (14), Turkey (26) and Poland (30) are trending down. Chile joins the list for the first time and Israel drops off the list.
See www.monocle.com for the complete list and details.

THE ECONOMIST magazine recently published its Global Business barometer, which surveyed 1,500 executives who see the business environment much brighter in the Middle East and Africa, Eastern Europe, Asia-Pacific, North and Latin America. The trend has gone from significantly negative in mid-2013 to significantly positive in late 2013. (Source: The Economist; December 2013)

A year-end McKinsey study found that global executives are more optimistic about economies growing, especially in the developed world. Of course, this is a mixed signal as developing countries are seeing more challenges. (Source: McKinsey, ‘Economic Conditions Snapshot’, December 2013)

The Boston Consulting Group released a study that indicates that “. . .despite dreary news of economic slowdowns and market volatility from Brazil to India to Turkey, consumer sentiment in some of the world’s largest rapidly developing economies remains remarkably bullish. Shoppers in key emerging markets feel more financially secure and far more confident about the future than those in developed economies. They also express greater enthusiasm for brands and for consumerism itself.” (Source: Boston Consulting Group, ‘Why Emerging-Market Consumers Remain Bullish’, 11/27/2013)

Frankly, at the end of 2013 it is possible to find optimism and pessimism around the world depending on which survey you read. More are now positive. They were negative in early 2013.

The bottom line is that the global middle class – the consumer class – continues to grow fast. And this group wants the brands, quality, convenience and customer service that U.S. franchises represent.