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Subject:
CHINA BUSINESS
Period: February 1, 2016 to April 1, 2016
Geographies:
Worldwide
Categories:
Comment & Opinion or Companies, Organizations or Consumers or Controversies & Disputes or Deals, M&A, JVs, Licensing or Earnings Release or Finance, Economics, Tax or Innovation & New Ideas or Legal, Legislation, Regulation, Policy or Market News or Marketing & Advertising or Other or People & Personalities or Press Release or Products & Brands or Research, Studies, Advice or Supply Chain or Trends
Contents
 

Battered By Poor Sales In China, Hershey Girds For The Future

Chocolate maker Hershey’s has its work cut out over the coming years, according to Euromonitor. Though profit was satisfactory, overall sales fell slightly in 2015 – and by five percent in the fourth quarter and 13 percent in China. The company, which advanced in recent years into the international market, is struggling to keep up with competitors. The core North American market is softening as per capita chocolate volume growth slows. Americans who buy chocolate are turning to higher quality brands, and that has led to competitive pressure from Lindt and Ferrero. Over the next five years, Hershey’s is expected to focus on its non-confectionery portfolio, pushing wider distribution of Krave Jerky meat snacks and Brookside Snack Bars in 2016.

"The Fourth Quarter Caps off a Year to Forget for Confectionery Giant Hershey", Blog, Euromonitor International, February 03, 2016

Chinese Company Acquires Syngenta In Push To Ensure Country’s Food Supply

After Monsanto failed to secure a purchase deal, ChemChina has made an offer to acquire Swiss crop protection company Syngenta at $465 a share. ChemChina’s main businesses include materials science, life science, high-end manufacturing and basic chemicals. Syngenta’s corporate vision jibes with China’s priority to ensure the food supply for its people. Syngenta enables farmers to make better use of available resources and “to transform how crops are grown.” Industry observers say only ten percent of China’s farmland is managed efficiently after years of intensive farming and overuse of chemicals. The land has been debased and the water supply poisoned. One of Syngenta’s major functions is to rescue land from degradation, enhance biodiversity and revitalize rural communities.

"Syngenta Board Seeks Approval of ChemChina’s $43 Billion Offer", The New York Times, February 03, 2016

L'Oreal Sells More Cosmetics In China Than In France

L’Oreal SA CEO Alexis Perakis-Valat said the French cosmetics company’s sales in China grew 4.6 percent to 14.96 billion yuan, or $2.29 billion), in 2015. With sales growth driven in a large part by the local market’s multi-brand make-up boom, the company now sells more cosmetics in China than it does in France. Perakis-Valat also said the market boom is due to the growing “selfies” trend among women in China.

"Selfies help drive L'Oreal's China sales amid a beauty craze", China Daily, February 26, 2016

 
Companies, Organizations  

L'Oreal Names Rinderknech CEO Of China Business

L’Oreal appointed Stephane Rinderknech as CEO of L’Oreal China. He succeeds Alexis Perakis-Valat, who will remain as EVP in charge of the Asia Pacific zone and member of L’Oreal’s Executive Committee in Shanghai. Rinderknech will remain head of L’Oreal China’s Consumer Products Division.

"New appointment L’Oréal China", L'Oréal, February 25, 2016

Alibaba-Tencent Rivalry Now Reaches China's Energy Industry

China’s largest Internet companies, Alibaba Group Holding Ltd. and Tencent Holdings Ltd., expanded their rivalry to include the country’s oil and gas industries. Alibaba agreed to provide China National Petroleum Corp., the local oil and gas production giant, with Internet-based services. Alibaba’s deal came after Tencent signed in August 2014 a collaboration deal with China Petroleum & Chemical Corp., which operates more than 30,000 fuel stations across the country, in areas including mobile payments and media marketing.

"Alibaba and Tencent Extend Their Web Battle to the Gas Station", Bloomberg Business, March 10, 2016

China Weighs Down Amway’s Sales

Natural Products Insider, February 09, 2016

Beauty for a Troubled Planet

GCI Magazine, February 17, 2016

China Banks on the Rural Consumer to Drive Spending

Women’s Wear Daily, February 21, 2016

Walmart launches cross-border e-commerce service

Marketing-Interactive, March 29, 2016

Legal, Legislation, Regulation, Policy  

Wal-Mart Bribery Probe Is Nearing Completion, U.S. Prosecutors Say

U.S. prosecutors are nearing completion of their international probe into bribery allegations against Wal-Mart Stores Inc. During the four-year investigation, which covered Mexico, Brazil, India, and China, U.S. Justice Department officials have faced various challenges, including in Mexico where results of investigation were too old to be used as evidence. In China, prosecutors saw their work hampered by the country’s disclosure rules and lack of evidence. Wal-Mart has promised to cooperate with U.S. authorities and spent almost $750 million on its own probe and on reorganizing its compliance operations.

"Wal-Mart Probe in Final Lap With Scant China Findings", Bloomberg, March 18, 2016

China Revises Taxation Rules For Imported Goods Sold Online

China is amending its tax rules for imported products sold online by removing a special tax, also known as parcel tax, previously imposed on such goods. Replacing the parcel tax will be value-added and consumption duties that are at present levied on most products sold in the country. According to China’s Ministry of Finance, however, the new tax will come with a 30-percent discount. In January 2016, China expanded a pilot program, which allowed a port district in the city of Hangzhou to trade imported goods at lower rates. Online sales of imported goods in China have expanded at a CAGR of 63 percent in the five-year period ending 2015 to reach 638 billion yuan, or $98 billion, accounting for 17 percent of the country’s total online retail sales, data from Mintel Group Ltd. revealed.

"China Changes Online Import Tax Rules, a Move to Help Cosmetics", Bloomberg Business, March 25, 2016

Market News  

Walmart Unveils Expansion Plans In Southern China

Walmart plans to build eight new stores and a distribution center in China’s south region. Following the retailer’s signing of a cooperation memorandum with the local government of Dongguan, an industrial city near Hong Kong and Macau, the planned facilities are part of Walmart’s expansion in the region. According to the retailer, the planned expansion will create more than 3,000 new jobs in the city in the next five years.

"Walmart expands in southern China", Retail Analysis, March 07, 2016

Mobile Commerce Accounts For Bigger Part Of Ecommerce In China, Analysts Report

Mobile sales accounted for almost 50 percent of ecommerce sales in China in 2015, according to eMarketer. Data from Analysys International Enfodesk revealed mcommerce accounted for almost two-thirds of retail and consumer-to-consumer ecommerce sales in China in the fourth quarter of 2015, an increase of 55.5 percent from the previous quarter. In 2016, eMarketer predicts retail mcommerce sales in the country will grow 51.4 percent, accounting for 55.5 percent of retail ecommerce sales in China for the year.

"Ecommerce Turns into Mcommerce in China", eMarketer, March 23, 2016

For whom the bubble blows

The Economist, March 12, 2016

Finding Opportunities in Emerging Markets in 2016

Euromonitor International, March 21, 2016

China Likely to Stay a Middle Income Country

Euromonitor International, March 28, 2016

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