Eight Challenges Faced When Operating in Emerging Markets

by | Jan 9, 2020

Emerging markets face different challenges than developed countries. These challenges have led to volatile markets, with data that is constantly changing and affecting how business is conducted. Around 80% of the world’s GDP comes from emerging markets, so it is vital to have a constant supply of accurate data.

With these challenges come new opportunities. Emerging markets are evolving at a rapid pace and more people than ever are entering the middle class. Due to the changing environment, there is an increasing demand for consumer packaged goods (CPG) and fast-moving consumer goods (FMCG). 

While every country and customer is different, below are a variety of the challenges that our customers have experienced while working in emerging markets around the world:

  1. Financial Infrastructure: Emerging markets may have underdeveloped financial infrastructure which impacts banks, stock exchanges, currency and information about the current state of investments, all of which impacts consumer spending habits and behaviors
  2. Political Instability: A large majority of emerging markets face military unease, an unstable political party and social disorder, which can contribute to a number of challenges for retailers, manufacturers and consumers
  3. Domestic Infrastructure Problems: The infrastructure in emerging markets is often not at the same level as developed countries which can often mean that businesses have to adapt their strategies to be successful
  4. Unreliable Distributors: We have seen that some distributors do not deliver items to locations that they are contracted to or said they did making it challenging for brands to understand where their products are being sold
  5. Fractured Supply Chains: Often there is a lack of visibility in the supply chain for all the parties involved which creates a lack of synchronicity between suppliers and operators
  6. Product Diversion: Often times in emerging markets products are diverted and sold by unauthorized distributors or locations
  7. Rapid Change: Change is inevitable in emerging markets, especially as their economies grow, businesses come and go making it difficult to maintain an accurate record of the state of certain places
  8. Territory / Region Entrance: When companies choose to enter new territories or regions in emerging markets they often find that there is no trusted database of information they can pull from, meaning they have to collect all the data themselves

See how Premise’s global network of Contributors can help you navigate gathering data in emerging markets. Visit us at www.premise.com or email us at [email protected]