THE OEM - OBM DEBATE: FACTORS INFLUENCING CHIN ESE FIRMS' BRANDING DECISIONS IN THEIR INTERNATIONALISATION PROCESS

A key international marketing decision for many Chinese (and firms from other emerging markets) is whether to internationalise their own brands-labelled by the Chinese as OBM (Original or Own Brand Manufacturing)-or to be international players by acting as contract manufacturers(labelled by the Chinese as OEM (Original Equipment Manufacturing) for foreign brand owners(FBOs). The paper discusses some of the extant research on the advantages and disadvantages of each business model and then focuses on primary research conducted amongst 8 Chinese firms in electronics and textiles and the OEM-OBM decisions they face. In so doing, it discusses some of thefactors influencing such decisions and proposes a framework for reviewing them as firm and environmental circumstances change

The global apparel value chain, trade and the crisis : challenges and opportunities for developing countries

This paper examines the impact of two crises on the global apparel value chain: the World Trade Organization phase-out of the quota system for textiles and apparel in 2005, which provided access for many poor and small export-oriented economies to the markets of industrialized countries, and the current economic recession that has lowered demand for apparel exports and led to massive unemployment across the industry’s supply chain. An overarching trend has been the process of global consolidation, whereby leading apparel suppliers (countries and firms alike) have strengthened their positions in the industry. On the country side, China has been the big winner, although Bangladesh, India, and Vietnam have also continued to expand their roles in the industry. On the firm side, the quota phase-out and economic recession have accelerated the ongoing shift to more streamlined global supply chains, in which lead firms desire to work with fewer, larger, and more capable suppliers that are strategically located around the world. The paper concludes with recommendations for how developing countries as well as textile and apparel suppliers can adjust to the crisis.Markets and Market Access,Economic Theory&Research,Free Trade,Labor Policies,Access to Markets

Industrial restructuring and early industry pathways in the Asian 1st generation NICs: The Singapore garment industry

This article aims to contribute to an understanding of the industrial dynamics/evolution of mature export production complexes in the first generation Asian NICs, employing an evolutionary economic perspective. Over the past decade and longer the first generation Asian NICs, Singapore included, have been confronted with imperatives necessitating deep restructuring. We observe that industrial decline, associated with failed restructuring caused by lock-in, does not fit these countries, its industrial regions and early industries. Yet research has hardly begun to look at adjustment and address deeper evolution from tenets in the framework of evolutionary economics although such an approach is made not less but rather more relevant by continued resilience. We analyse the pathway(s) of one early industry, i.c. the apparel industry, in Singapore, through the 1980s and 1990s. The withering away in the Singapore context of an industry such as apparel is not inevitable. From a juxtaposition of the line of thinking in evolutionary economics emphasizing hindrance and decline due to path dependency and lock-ins with an alternative line emphasizing the possibility to adjust through renewal and the limited operation of lock-ins, we argue why the latter rather than the former has been the case.evolutionary economics, industrial restruction, Asia, NICs

Accelerated Internationalisation by Emerging Multinationals: the Case of White Goods Sector

The emergence of a "second wave" of developing-country multinational enterprises (MNEs) in a variety of industries is one of the characterizing features of globalization. These new MNEs did not delay their internationalisation until they were large, as did most of their predecessors, and often become global as a result of direct firm-to-firm contracting. Many grow large as they internationalise conversely, they internationalise in order to grow large. This is a striking pattern which, if confirmed, indicates that enterprises from developing countries have pursued distinctive approaches to internationalisation. It is a further interesting hypothesis to investigate to what extent such firms, born as suppliers of established incumbents, have leveraged on their "latecomer" status to accelerate their internationalisation. This paper documents how emerging MNEs may follow quite different patterns to reach, or at least approach, global competitiveness. In particular, it investigates how three latecomer MNEs pursued global growth through accelerated internationalisation combined with strategic and organizational innovation. Haier (China), Mabe (Mexico) and Arcelik (Turkey) emerged as Dragon Multinationals in the large home appliances (so-called "white goods") industry. This is a producer-driven global value chain, characterized by mature technology and rapid delocalization to developing countries, where not only input costs are lower, but demand growth rates are higher - giving a decided latecomer advantage to these MNEs. Haier, Mabe and Arçelik leveraged their strategic partnership with established MNEs to upgrade their operations, evolving from the production of simple goods, into new product lines developed through their own design, branding and marketing capabilities. The recipe of their success has been the ability to treat global competition as an opportunity to build capabilities, move into more profitable industry segments, and adopt strategies that turn latecomer status into a source of competitive advantage. At the same time, their experiences show that there are many strategies and trajectories for going global.Internationalisation; latecomer; MNEs; white goods; Haier; Arcelik; Mabe

National innovation systems for rapid technological catch-up

노트 : Paper to be presented at the DRUID Summer Conference on National Innovation Systems, Industrial Dynamics and Innovation Policy, Rebild, Denmark, June 9-12, 199

From Technological Design to Service Innovation : A Case Study of the Development of Design Education in Taiwan

In today’s competitive market, “innovation” serves as a competitive advantage allowing companies to dominate particular market segments. Service design has increased attention in the academic and business communities over the past decade. Based on the “Taiwan experience”, the purpose of this study is to explore the development of design education by integrating the difference between technological product design and the service innovation design. Two cases are expounded for the development of Taiwan design education in this article. One is the cover design of industrial design magazine which reflected the change of product design education from function, friendly, fun, fancy to feeling. The other case is the development of The National Taiwan University of Arts which being used as an example to illustrate how to link the service innovation design and cultural and creative industries through Our Museum, Our Studio and Our Factory respectively. The results showed that the development of Taiwan design education along with the economic development from OEM, ODM, to OBM that joins design, culture, creativities and economy, and further illustrates some implications through the cultural perspective.Theme II : Transnational Design in and around Asi

Dynamics of the Textiles & Apparel Industries in Southeast Asia : A Preliminary Analysis

The apparel industry is a representative case of a buyer-driven global value chain, as suggested by Gary Gereffi. We examine this hypothesis by focusing on the textile and apparel industries in Southeast Asian countries, especially the Philippines, Malaysia, and Thailand. We found that there are two different kinds of value chains in these industries. In one, the lead firms are engaged in chemical fiber production, and, in the other, the lead firms are engaged in fast fashion retailing. The former is a producer-driven chain and the latter is a buyer-driven chain. In Southeast Asian countries today, we find these two different chains. Japanese chemical fiber producers during the 1960s and 1970s represented the former case, and today this type is found among Indian chemical fiber producers such as Reliance Industries, the Indorama group, and the Aditya Birla group. On the other hand, US and Western European fashion retailers represent the latter case; this is especially so among Hong Kong Chinese entrepreneurs. In future, even firms in the small countries of Southeast Asia can upgrade and be fashion retailers without having fiber and textile production bases if they can develop their own designs and brands, and develop merchandizing, marketing and coordinating capabilities and skills