Rise of the meganiche: Asia’s growing middle class

///Rise of the meganiche: Asia’s growing middle class

Rise of the meganiche: Asia’s growing middle class

Asia’s rapidly expanding middle-class – and the ‘meganiches’ that will form as a result – offers massive potential for Australian manufacturers willing to adapt, says manufacturing expert Charlie Macdonald.

Mr Macdonald, a manufacturing, transport and logistics industry executive at Telstra, will speak on the topic in late May as part of National Manufacturing Week.

By 2030, the Asia Pacific region will be home to two-thirds (around 3.2 billion people) of the world’s middle class, according to the report Make For Asia, released last year by Telstra and the CSIRO.rsz_country

Mr Macdonald, who sponsored the report, says the rapid rise will lead to dramatic changes in buying trends. With more money at their disposable, the Asian middle classes will be looking for “clean and green and safe” products,” he says.

According to the Make for Asia report, the rise of the middle class will have huge implications for sectors including health, food and beverages and technology, with many Asians placing higher status and trust in foreign products.

By 2050, Asia will be home to almost a quarter of the world’s population over 60, who will want specific products for their health needs, the report states. And with incomes already rising, growth in the sale of discretionary items such as imported cars, electronics and recreational equipment are surpassing those of primary goods.

All of these factors, plus increased urbanisation as people seek improved living conditions in cities, will lead to ‘meganiches’ – markets of 50 to 300 million people who don’t mind spending more money to get the products they want or need, the report states.

Mr Macdonald says these meganiches offer huge opportunities for Australian manufacturers who can move swiftly before the void is filled by local manufacturers – or other astute international competitors.

He says embracing advanced technology such as additive manufacturing (also known as 3D printing), intelligent robotics and flexible electronics will be a definite component for those who want to tap into the emerging markets, but businesses will need to adapt in many different ways. “It’s imaginative, creative people who are going to be behind this.”

“In our old manufacturing we made stuff and we tried to sell it. In new manufacturing it’s much more customised – much more tailored. We make on demand. We design digitally – we collaborate digitally,” says Mr Macdonald.

He gives the example of a Queensland company that’s turning the tables by selling customised T-shirts to Chinese customers.

Mr Macdonald says good supply chains will be crucial for Australian manufacturers who want to seize the opportunities presented by the growing middle classes.

“The other thing is we shouldn’t look at Asia as a single market,” says Mr Macdonald who points out that China’s and Japan’s large elderly populations will have very different needs to younger, increasingly tech-savvy shoppers in Indonesia and India.

The National Manufacturing Week event will be held at the Melbourne Convention and Exhibition Centre from May 26-29. Register here.

2018-01-09T11:59:31+11:00 May 9th, 2015|