Markets that are emerging rapidly are becoming very popular among organizations in the world. Emerging markets mainly include nations whose economies are progressing rapidly. This simply means that there are some countries that are enjoying a great economic interface and proving to be ideal for sourcing. With time, emerging markets are defining the importance of global trade as well as providing enough opportunities to companies for investment. But still, certain challenges are essentially needed to overcome to get the exact growth. With the advancement of countries and their economies, organizations are ethically looking forward to having their businesses taken to the next level. Emerging markets sourcing is simply considered the best option for the betterment of your business regardless of the size. You sincerely need to make your efforts count in this case.
Facts About Emerging Markets
Read below to know in detail about the major facts related to emerging markets for sourcing.
- Frontier Markets Offer a New Class of Growth
Whenever the talk is about emerging markets, people mostly think of India, Brazil, and China – the big hitters of the world. But some countries that have them named frontier markets could soon be seen outplacing their growth. Many of these markets are based in Africa or renowned in Africa, like Kenya and Nigeria. But, it is nowadays seen that Argentina and Vietnam are gaining a lot of attention from people and other businessmen as well.
- Questioning the Corruption Narrative
It is nowadays heard that emerging markets are associated with unsound governance and corruption. But since this is a rumor, it may not be true. At the same time, many companies are also seen to be improving. In Vietnam, the campaigns that are happening against government corruption and its policies for state-owned enterprises have positively led to a sharp increase in direct foreign investment. Amidst that, a 46.9% surge was seen in the stock market value of Vietnam in 2017. This is to note that questioning the corruption narrative should not stop until the truth is visible properly.
- Leapfrogging Will Continue to Transform
Leapfrogging simply means skipping steps in industrialization. Companies usually do so when they find advanced technologies joining them for the betterment of their businesses just like what sub-Saharan Africa did. It skipped the technological advancement of landlines directly to mobile phones. But there remains a doubt whether businesses and governments, still equipped with outdated technology, could get over systems of legacy and get into the advanced period.
- Manufacturing-Based Economies are in for Change
Manufacturing and exporting are considered the main drivers of growth in the largest emergence of markets which have been run for years. But, since automation is on a sharp rise, almost all developed economies may move away from outsourcing their manufacturing activities to low-cost labor regions. This will again lead to forcing emerging economies to move to more service-based growth from an export-driven model.
Emerging markets sourcing can undoubtedly bring a great change in the world of business as well as with its automation. But there are certain things that need to be considered and covered well before making moves. It will then always be beneficial for your organization or business.
Comment One of the most important aspect of the emerging markets which needs to be considered is the political stability as the economic policies and reforms play an important part in business of such counties. That brings confidence in the investors.
Education too plays an important part. With the technological impartments amongst countries, it’s apparent that the markets should have enough understanding to run technology enabled businesses smoothly. So, the literacy rate counts too.
The emerging markets definitely has an advantage on competitive price, quality, discipline in business processes with the sourcing partners to make it cost effective for the investors.
One of the most important aspect of the emerging markets which needs to be considered is the political stability, as their economic policies and reforms plays an important part in attracting new business. With favourable policies and stability, it gives confidence to the investors.
Education too plays an essential part. With the technological impartments amongst countries, it’s apparent that the markets should have enough understanding to run technology enabled businesses smoothly. So, the literacy rate counts too. Back end offices in India is a perfect example of this.
The emerging markets definitely have an advantage on competitive prices. But quality, discipline in business processes can only be achieved with sound sourcing partners for investors, to make it cost and time effective for them
Thank you, Sunita for your valuable comments.