European brands are competing each other
with blood spilling on all sides. They are making their suppliers and
consultant (falsely called partners) feel it, by shopping around non-stop for
short-term efficiency.
The worst cases take the creative ideas, which they have
been trusted with and run off to implement them as their own by someone else. They
also sell past their trusted distributors via online channels and web stores,
exploiting these long-time distributors as showrooms.
What will all this lead to?
In the short term, these brands should
become more profitable. For some reason, there is no evidence of this. In the
longer term, however, their quality is bound to decline; their consumers become
unsatisfied, and ditch them for other choices as the European brands save
themselves to death. At the same time, the suppliers and distributors are
getting bankrupt.
So who will benefit?
International investors, because money goes
to money. And yes, more and more often they are Chinese.
At the moment, you can buy excellent brands
with incredible IPR value “for peanuts”, as described the new owner of one
Italian luxury brand. Keeping the patent portfolio of this brand up-to-date
costs 100 000 euro per year, and as the European economy is what it is; even this
seems to be too much, not to mention the investments in keeping the brand
relevant with its users.
Because European brands are still looking at the world
through their colonial lenses neglecting the growth, consumption, learning, and
innovation taking place elsewhere, they are soon left on the battleground
gasping for air.
Meanwhile, in
2013, Chinese investors bought out
a record of 120 European companies, says Ernst & Young. Out of these
businesses, 25 were German, 25 British, 15 French, 7 Italian and 7 Swedish.
Largest amount of companies were in the field of real estate, but 21 were
consumer goods companies. Automobile sector is one of the most interesting ones
for the Chinese.
Money has no nationality. Will Europe
soon be without?
