apparel in brazil, china, india how the world shops
DESCRIPTION
Consumer BehaviorTRANSCRIPT
The McKinsey Quarterly 2007 Number 468
70China: Small budgets, small wardrobes
74India: Shopping with the family
In emerging markets around the
world, the spending power of consumers
is rapidly changing the retail industry,
both globally and locally. Multinational
retailers seeking new sources of
growth are watching the mass markets
of Brazil, China, and India, whose
large populations and strong economic
growth have made them nearly
irresistible. As consumers have greater
disposable income, they increasingly
spend their money on items beyond the
basic necessities. One of the first
categories to feel this change is apparel.
To understand more fully what it would
take for retailers to succeed in
these markets, McKinsey conducted a
proprietary research project on
apparel-shopping attitudes and behavior
in Brazil, China, and India. Our sample
consisted solely of women,1 who
in many markets not only decide what
clothes to buy for themselves but
also influence clothing purchases for
their children and husbands. We
supplemented this quantitative research
with dozens of focus groups, store
visits, interviews, and shopping diaries.
“China: Small budgets, small wardrobes”
shows how that country’s fickle
consumers and strong local competitors
threaten to undermine the multinationals’
efforts. “India: Shopping with the
family” explains the different roles that
Indian women, men, and children play
in making decisions about apparel and
the way the market there is evolving.
“Brazil: Fashion conscious, credit ready”
describes the country’s enthusiastic
shoppers, as well as the efforts of banks
and retailers racing to meet their
credit needs.
How half the world shops: Apparel in Brazil, China, and India
Special report: Emerging-market consumers 69
76Brazil: Fashion conscious, credit ready
The authors wish to acknowledge the contribu-
tions of their colleagues Susan Breuer,
Claudio Lensing, Savita Pai, and Khiloni Westphely.
In memoriam
We dedicate this collection to the
memory of Alastair Ramsay, a partner
in McKinsey’s London office, who
founded and led this research project.
Alastair passed away in June 2007.
He inspired us with his commitment
to client service, as well as his warmth
and compassion as a leader.
1Wesurveyed6,000consumersoffood,apparel, andelectronicsinBrazil,China,India,and Russia,including900womenacrossBrazil,China, andIndia,specificallyonapparel.Inaddition wesurveyed1,600shoppersinFranceand theUnitedStatesforthepurposesofcomparison.
69
The McKinsey Quarterly 2007 Number 470
China’s clothing consumers are legion, but inexperienced about subcategories, quality, and features. Global retailers can help.
Wai-Chan Chan, Richard C. Cheung, and Anne Tse
Despite rapid growth, China’sapparelmarketpresentsglobalretailerswithsignificantchallenges.AMcKinseysurveyofChineseconsumersunder-scoresthedifficultymultinationalretailersmayfaceinapplyingtoChinatheirtried-and-trueformulasfordifferentiatingproductsandbrandsandsuggeststhattheyshouldadoptnewapproachesinareassuchasin-storesalesandadvertising.Moreover,thesurveyhighlightsimportantdifferencesbetweenaverageChineseapparelshoppersandthecountry’syoungadults—agroupthatoffersglobalretailerssomeintriguingpossibilities.
Thesefindingsemergedfromaresearcheffortthatcombinedaquantitativesurveyofurbanmass-marketconsumerswithqualitativeresearchtech-niques,includingshopperdiaries,storevisits,andfocusgroups.1Westudiedthemassmarketbecauseitincreasinglydrivestherapidgrowth(12per-centayear)ofChina’s$84billionretailapparelmarketandrepresentsasignificantopportunityforforeignretailerstoexpandbeyondthehigh-endconsumerstheyhaveservedsincetheearly1990s2China’sapparelmarketisnowtheworld’sthirdlargest—behindonlytheUnitedStates($232billion)andJapan($100billion)—andthefastest-growinginthe“BRIC”countries:Brazil,Russia,India,andChina.Seventypercent
China: Small budgets, small wardrobes
1Wesurveyedtheapparel-shoppingattitudesandbehaviorof300women,whoinChina(asinmanyother markets)notonlydecidewhatclothestobuyforthemselvesbutalsoinfluencetheclothingpurchasesoftheir childrenandhusbands.2Forresearchpurposes,wedefinedChinesehigh-end(orglobal)consumersasthosewithannualhousehold incomesgreaterthan$12,200(at2005exchangerates);mass-marketconsumers,incomesfrom$3,000to $12,200;andstrugglingconsumers,incomesbelow$3,000.Themassmarketcanbefurthersubdividedinto a“consuming”group(withincomesfrom$5,000to$12,200)andan“aspiring”one($3,000to$5,000).
Special report: Emerging-market consumers 71
ofapparelsalesinurbanChinatakeplaceinmodernformats(typi-cally,departmentstores,thoughmorespecializedshopshaverecentlybeguntoemerge).
OurresearchindicatesthatChina’smass-marketconsumershaverelativelysmall,undifferentiatedwardrobes.FortypercentoftheChineserespon-dents,forexample,reportwearingsimilarclothingatwork,formalsocialoccasions(suchasweddings),anddateswithfriendsorfamily,comparedwithonly8,13,and11percentofconsumersinBrazil,India,andRussia,respectively.Althoughhabitsarechanging,apparelretailersinChinamayfinditmorechallengingthantheydoinotheremergingmarketstoestablishthemselvesasspecialistsinclothingsubcategories,suchasladies’officeclothingorspecialtyoutdoorcasualclothing.
Moreover,Chineseconsumersofappareldon’tappeartoplaceapremiumonforeignbrands.Onlyone-quarteroftherespondentssaythatsuchbrandsofferbettervaluethanlocalonesdo,forinstance,andonly11per-centreportfrequentlytryingonforeignofferings.ThesefiguresstandinstarkcontrasttoourfindingsinIndia,whereabout50percentofrespon-dentssaythatinternationalbrandsaresuperiorinvalueorquality.What’smore,Chineseshoppersseemtorelymoreheavilyonpricetoformtheirperceptionsofaproduct’squalitythandoshopperselsewhere.WhereasnearlyhalfoftherespondentsinBrazil,India,andRussiabelievethattheycanquicklyassessthequalityofagarmentwithouttakingitscostintoaccount,only22percentofChineseconsumerssaythesame.
China’surbanyoungadults,from18to25yearsold—asegmentcomprisingabout15millionpeople—representanexceptiontothesetendencies.Manyyoungconsumersfavorinternationalbrands.Halfagreethat“foreignbrandsarehigherqualitythanlocalbrands,”comparedwithanaverageof15percentacrossallotheragecohorts.Similarly,36percentofChina’syoungadultssaytheyoftentryonforeignproductsandbrands,comparedwithanaverageofonly13percentofotherrespondents.Althoughyoungconsumersbehavedifferentlyfromolderonesinallofthecountrieswestudied,thedifferencesinChinawerebyfarthemostpronounced(Exhibit1).Thereyoungconsumersalsoshopforapparelmorefrequentlythandopeopleinotheragegroups,spendlargersumsonclothing,andaredisposedtospendevenmoreastheirincomesrise(Exhibit2).
Thesefindingshaveseveralimplicationsforglobalretailers.Clearly,targetingtheyoungisaripeopportunityandmayrequirefewerchangestotraditionalmerchandisingandmarketingapproachesthanservingolderconsumerswould.Toreachthisbrand-savvysegment,multinationalscancreatenew,nichebrandsthatconveyspecificpersonalitytraits—
The McKinsey Quarterly 2007 Number 472
forexample,irreverenceorcreativity.Retailerscanalsocreatelower-pricedextensionsofexistingbrands,asFrance’sEtamhaswithits“EtamWeekend”line.
Further,multinationalretailersshouldhelpshoppersbecomebetterinformedaboutclothingsubcategories,productquality,andinternationalbrands.Therecentstronggrowthofsportswearsubcategoriessuchashikingandmountain-climbinglifestyleapparelsuggeststhattheChineseconsumer’sdesiresarechangingandcouldchangefasterifnudged.Companiesthatseektoshapethemassmarket’sevolution—say,throughin-storesaleseffortsthathighlightproductfeatures,seminarstohelpconsumersdiscernproductqualityandcraftsmanship,oradvertisingfocusedonthebenefitsofparticularsubcategories—shouldhelpimprovecustomersatisfactionandloyalty.Esprit,basedinHongKong,hassuccessfullyextendeditsbrandintoanincreasinglydiverserangeofclothinglines(includingcasual,sporting,andwork)bycombiningin-storeelements(suchastailoreddisplayracks,lighting,andmusic)tocommunicatetheessenceofvarioussubcategories.
AsglobalretailerscontemplateChina’smassmarket,theymustrecog-nizethattheyfacemorepowerfullocalcompetitorstherethaninthehigherendofthemarket.Indeed,thecostadvantagesoflocalplayersandtheirincreasingabilitytolearnfromglobalretailers’storelayoutsandpromotionalcampaignswilllikelymakeitdifficulttoenterChina’s
Q4 2007China apparelExhibit 1 of 2Glance: The Chinese young-adult segment is important for foreign players.
e x h i b i t 1
Young shoppers
I trust brands from my own country.
Average score on scale of 1–6, where 1 equals ‘strongly disagree’ and 6 equals ‘strongly agree’
Foreign brands are higher quality than local brands.
Brazil
China
India
5.04.8
4.63.7
4.34.2
Young adults (aged 18–24)
All others
2.93.0
3.44.4
3.73.6
Russia 4.33.7
3.63.9
Source: 2006 McKinsey survey of apparel-shopping attitudes and behavior of 300 women in each country (in these markets, women are primary in�uence on clothing purchases for entire family)
Strongly agreeStrongly disagree1 6.0
Strongly agreeStrongly disagree1 6.0
Special report: Emerging-market consumers 73
massmarketwithapure-valueplay.Analternativeapproach,whichmultinationalssuchasZaraarestartingtouse,involvesidentifyingconsumerswillingtopaymoreforthelatestfashions.Bycreatinglow-costyettrendystand-aloneoutletsinupscalemallsorshoppingdistricts(asopposedtodepartmentstores),retailerscanappealsimultaneouslytomass-marketconsumerswithpremiumtastesandtohigher-endcus-tomersprowlingforbargains.SuchstrategiesholdgreatpromiseasChina’smassmarketgrowslargerandricher.Q
Q4 2007China apparelExhibit 2 of 2Glance: They likely spend more on apparel and are more willing to try foreign brands.
e x h i b i t 2
Devoted to clothing
How frequently did you shop and buy apparel in the past 6 months?
Average number of trips per half yearAge1
Age1
How much do you spend on apparel for yourself in a typical month?
Spending per month, renminbi2
Young adults are the heart of apparel consumption in China . . .
. . . and they also have a stronger intention to purchase.
18–24
45–55
35–44
25–34
4.5
2.3
2.8
3.8
104
51
70
102
Foreign brands are higher quality than local brands.
% who agree/strongly agree
I often try foreign products and brands.
18–24
45–54
35–44
25–34
50
12
17
16
36
16
55–64 13 21
7
6
On which category would you spend more money if your income increased?
% who would spend more on apparel
72
34
43
54
On which category would you never cut expenses under budget constraints?
% who would never cut apparel expenses
15
7
6
8
1For ages 18–24, n = 22; ages 25–34, n = 106; ages 35–44, n = 98; ages 45–54, n = 51; ages 55–64, n = 33; bases are weighted to adjust for each age group’s relative share in population.
21 renminbi = $0.13 in 2006.
Source: 2006 McKinsey survey of apparel-shopping attitudes and behavior of 300 women in each country (in these markets, women are primary in�uence on clothing purchases for entire family)
Wai-Chan ChanandRichard CheungareprincipalsandAnne TseisanassociateprincipalinMcKinsey’sHongKongoffice.
The McKinsey Quarterly 2007 Number 474
Indians devote roughlythesameshareoftheirincometoapparelasdoChineseandBrazilians.Butthecountry’slowerpercapitaincomelevelsmeanoverallspendingonapparelissignificantlylower,andthehabitsofIndianshopperspresentintriguingchallengesformultinationalseyeingthemarket.1Forstarters,nearly40percentofthemass-marketIndianshoppers2wesurveyedsaidthattheirmostimportantshoppingoccasionsrevolvedaroundspecialevents,suchasweddingsandannualreligiousfestivals—afiguredramaticallyhigherthantheoneforshoppersintheotheremergingmarketswestudied.Furthermore,toagreaterextentthanelsewhere,shoppingisafamilyactivityinIndia:nearly70percentofitsshoppersalwaysgotostoreswithfamily,and74percent—morethantwicetheaverageofBrazil,China,andRussia—viewshoppingasthebestwaytospendtimewithfamily.Thepreferenceforfamily-orientedshop-pingisconsistentacrossagegroups,incomesegments,regions,andcitysizes.
Asinmanymarkets,inIndiawomenaretheprimarydecisionmakersinapparelpurchasesfortheentirefamily.ButIndia’smenalsohavean
India: Shopping with the family
The Indian apparel market has some distinctive features that mass-market retailers must accommodate.
Kartik N. Sheth and Ireena Vittal
1InIndia,lawsgoverningforeigninvestmentbyretailersareslowlyevolving.Currently,single-brandforeign retailersmayholdcontrollingstakes(upto51percent),butmultibrandforeigncompaniesareableto investonlyinthe“cash-n-carry”segment(upto100percent)orbuyastakeinapubliclylistedretailer(upto 26percent).Inacash-n-carryoperation,awholesalersellstooffices,hotels,andretailersthatbecome itsmembers.2InIndia,ratherthanusingonlyincomebandstodefinecategoriesofconsumers,weusedthesocioeconomic classcodesestablishedbytheMarketResearchSocietyofIndia.High-endor“global”consumersare thoseinsocioeconomicclass(SEC)A,mass-marketconsumersarethoseinSECsBandC,andstrugglingcon- sumersarerepresentedbySECsDandE.Inadditiontohouseholdincome,theclasscodesincorporate levelsofeducationandoccupation.
Special report: Emerging-market consumers 75
importantrole:indeed,halfofoursurveyrespondentssaidthattheirhus-bandshadamajorinfluenceonwhichstorestheyfrequented—apropor-tionfarhigherthantheoneforBrazil(3percent),China(8percent),andRussia(18percent).What’smore,Indiaisunusualinthatthemarketformen’sapparelislargerthanthewomen’smarket,wheretraditionalIndianapparelstilldominates.Mass-marketapparelretailersmustthereforefindformatsandmerchandisingapproachesthatwillattractshoppersseek-ingapparelnotonlyforspecialoccasionsbutalsoappealingtotheentirefamily.Q
I always go clothes shopping with friends or family.
Q4 2007India apparelExhibit 1 of 1Glance: Indian shoppers present an intriguing set of challenges.
e x h i b i t
A family affair
Most of the clothing I buy is for special events (eg, weddings, important festivals).
% of respondents who agree/ strongly agree
Estimated spending on clothing in last 6 months, €
% of respondents who agree/ strongly agree1
1Respondents in India were allowed to select more than 1 category of clothing (eg, home, work, special occasions).
Source: 2006 McKinsey survey of apparel-shopping attitudes and behavior of 300 women in each country (in these markets, women are primary in�uence on clothing purchases for entire family)
Russia
Brazil
China
India
198
173
106
59
3
5
6
38
29
36
35
68
Kartik Sheth isaconsultantandIreena VittalisaprincipalinMcKinsey’sMumbaioffice.
The McKinsey Quarterly 2007 Number 476
Local stores dominate Brazil’s mass-market retailing. Is there room for the multinationals?
Manuela Artigas and Nicola Calicchio
Brazil’s apparel market—large,growing,andmostlyuntappedbymultinationalcompetitors—seemslikeabigretailer’sdream.AMcKinseysurveyofthecountry’sconsumers,however,underscoresthesignificantchallengesforglobalplayers.Theseissuesincludeproductdemandsthatdifferfromthoseintheirhomemarkets,astrongpreferenceforlocalfashions,andtheuniquecombinationofwidespreadconsumercredituseandanundevelopedconsumercreditmarket.
WereachedthoseconclusionsbycombiningaquantitativesurveyofBrazil’surbanmass-marketconsumerswithqualitativeresearchthatincludedshopperdiaries,storevisits,andfocusgroups.1Thesubjectofouranalysisistheworld’sfifth-largestapparelmarket,whichisgrowingat7percentayear.Althoughmultinationalretailers(suchasMango,MissSixty,andZara)havesucceededinservingthecountry’swealthyconsumersforseveralyears,veryfewglobalretailerscompeteinitsmassmarket.2Instead,informal
“mom-and-pop”stores(someofwhichskirttaxestoobtainacompetitiveedge)andlargelocalsingle-formatretailersdominateBrazil’smassmarket,ringingupmorethan60percentofthecountry’sapparelsales.3
Brazil: Fashion conscious, credit ready
1TosurveyBrazilianattitudestowardcredit,wedrewonalargersampleencompassing300apparel consumers,plus1,200foodshoppers.(FormoreontheresultsofourfoodresearchinBrazil,seeNicola Calicchio,TracyFrancis,andAlastairRamsay,“HowbigretailerscanserveBrazil’smass-market shoppers,”The McKinsey Quarterly,2007specialedition:ShapinganewagendaforLatinAmerica,pp.50–7.2Wedefinemass-marketconsumersinBrazilasthosewithannualhouseholdincomesfrom$3,000to $15,000ayear(at2005exchangerates).3Formoreoninformalretailersandmom-and-popstores,seeAlejandroDíaz,JorgeA.Lacayo,and LuisSalcedo,“Sellingto‘mom-and-pop’storesinLatinAmerica,”The McKinsey Quarterly,2007special edition:ShapinganewagendaforLatinAmerica,pp.70–81.
Special report: Emerging-market consumers 77
AsmultinationalapparelretailerscontemplateenteringBrazil’smassmarket,theymustcometogripswithaconsumerlandscapethatdiffersconsiderablyfromwhattheyfindinmostdevelopedandmanyemerg-ingmarkets.Forstarters,Brazil’sconsumersareextremelyfondofshop-pingforclothes:almost80percentofourrespondentslookforwardtoit,afiguremuchhigherthanthoseforChinaandRussia,thoughaboutthesameastheoneforIndia(Exhibit1).Inaddition,morethanhalfofBrazil’sshopperssaytheyusemostoftheclothingtheybuyforgoingoutwithfriendsandfamily;theproportiongivingthatanswerinChina,India,andRussiaismuchlower(Exhibit2).
Furthermore,Brazil’smass-marketapparelshoppersseemparticularlyconsciousoffashion;onlyinBrazildiditrankamongthetopthreeattri-butesatpreferredstores.Fashiontrendstherearestronglyshapedbylocalcelebrities(inparticular,prominentcharactersfrompopulartelevisionsoapoperas),andonlylocalretailers(withafewnoteworthyexceptions)consistentlyofferthemass-marketsegmentthesefashions.TodaymanyoftheselocalretailersandthelocalbrandstheysellarehighlyregardedbyBrazilianshoppers:81percentofourrespondentsagreewiththestate-ment,“Itrustlocalbrands,”comparedwithabitlessthanhalfofthosewesurveyedinChina,India,andRussia.Similarly,only11percentofBraziliansagreethat“foreignbrandsarehigherqualitythanlocalbrands”—aproportionmuchsmallerthanitisintheothercountrieswestudied,althoughshopperstherealsoexhibitsomedegreeofresistancetoforeignbrands(Exhibit3).Someofthemultinationalsthathavehadmoresuc-cessintheBrazilianmarket,suchastheEuropeanapparelretailerC&A,haveestablishedlocalidentities,forexample,byrunningcampaignsfeaturingBraziliansupermodels.
Finally,Braziliansarefarmoreopentousingcreditthanareconsumersintheothermarketswestudied.Morethan60per-centoftherespondentsinBrazilagreedwiththestatement,“Ithinkitisperfectlyallrighttoshopforproductsoncredit,”forexample,comparedwith30percentinIndia,24per-centinRussia,and13percentinChina.What’smore,65per-centoftheBrazilianshadboughtsomethingoncreditduringthepastsixmonths,compared
Q4 2007Brazil apparelExhibit 1 of 3Glance: Brazilians are extremely fond of apparel shopping.
e x h i b i t 1
Shop until you drop
% of respondents who look forward to shopping for clothes
India
Brazil
Russia
China
82
79
27
26
1RIC = Russia, India, China.
Source: 2006 McKinsey survey of apparel-shopping attitudes and behavior of 300 women in each country (in these markets, women are primary in�uence on clothing purchases for entire family)
‘RIC’1 average = 45%
The McKinsey Quarterly 2007 Number 478
with25,9,and8percentoftheshoppersinRussia,China,andIndia,respectively.ThiscomfortwithdebthasfueledthespectacularexpansionofBrazil’screditindustry,whoserevenueshavegrownatratesexceeding26percentayearsince2001.4
Paradoxically,however,Brazil’scredit-reportingsystemisrelativelyundeveloped.Thecountry’sbanksgivethecreditprovidersinformation
1Figures do not sum to 100%, because respondents who answered “other" are not shown.2Respondents in India were allowed to choose more than 1 answer.3RIC = Russia, India, China.
Source: 2006 McKinsey survey of apparel-shopping attitudes and behavior of 300 women in each country (in these markets, women are primary in�uence on clothing purchases for entire family)
Q4 2007Brazil apparelExhibit 2 of 3Glance: They shop most often for clothes to wear while going out.
e x h i b i t 2
For work or play
% of respondents who agree or strongly agree1
Brazil Russia India2 China ‘RIC’3average
. . . work
. . . home
. . . all-purpose use (eg, undergarments, socks)
. . . going out with my family and friends
Most of the clothing I buy is for . . .
. . . special occasions (eg, weddings, festivals)
54
17
8
8
5
32
27
16
13
3
23
10
26
25
38
24
25
22
13
27
20
21
17
166
Q4 2007Brazil apparelExhibit 3 of 3Glance: Brazilian respondents value local brands much more than do those in China, India, or Russia.
e x h i b i t 3
Local vs foreign brands
% respondents who agree or strongly agree
Difference
I often try foreign productsand brands
I trust local brands
Foreign brands are higher quality than local brands
‘RIC’1 averageBrazil
27
24
48
11
12
81
–16
–12
33
1RIC = Russia, India, China.
Source: 2006 McKinsey survey of apparel-shopping attitudes and behavior of 300 women in each country (in these markets, women are primary in�uence on clothing purchases for entire family)
4AlexandreJ.Sawaya,“FinancingLatinAmerica’slow-incomeconsumers,”The McKinsey Quarterly,2007 specialedition:ShapinganewagendaforLatinAmerica,pp.58–69.
Special report: Emerging-market consumers 79
aboutconsumerswhohavedefaultedondebtsbutnotabouttheir“positive”credithistories(forinstance,repayingdebtontime).5Becauseoftheabsenceofcomprehensivecreditprofiles,general-purposecreditcardsarerareinBrazil,particularlyamongmass-marketconsumers.Still,theproclivityofBrazilianstobuyclothesoncreditmeansthatretailersfaceacompetitivedisadvantageiftheyrestricttheircustomerstocashpay-ments.Allmajorlocalandmultinationalapparelretailersthereforeoffercardswithlowinitialspendinglimitsthatincreaseasconsumersprovetheircreditworthiness.6Theseprivate-labelcards—offeredthroughretailer-ownedfinanceoperationsorjointventureswithbanks—nowfinancearound70percentoftotalsalesforBrazil’slargerapparelretailersandsome-timesgenerateprofitscomparabletothosethatretailersearnfromapparelpurchases.
MultinationalseyeingopportunitiesinBrazil’smassmarketforapparelwillthusneedtodevelopnewskills,sincetheywouldbecompetingagainstlocalretailersthatoftenarebettercreditunderwritersformass-marketcustomersthanarelargeretailbanks.(Localretailers,forinstance,havehigherpenetrationandlowerlossrates.)Multinationalswillalsohavetomanagetheirpromotionsdifferently.Indevelopedmarkets,promotionalcampaigns,forexample,tendtobeseasonalandproductspecific,butapparelretailersinBraziluseattractivecreditofferings,suchasinstallmentpayments,toenticecustomers.
TotakeadvantageofBrazil’suniquemarketcharacteristics,themulti-nationalswillhavetoconcentrateonhiringstronglocalmanagementteamsthatexcelbothatmerchandisingandathelpingtocraftcompetitivecreditofferings.Domesticretailers,fortheirpart,shouldcapitalizeontheirskilladvantagesbyexpandingbeyondthemajorcities,competinginnewformats,andtakingmarketsharefromtheinformalretailers—thuscapturingthelargegrowthopportunitiesbeforetheirmultinationalcompetitorscan.Q
Manuela ArtigasisanassociateprincipalandNicola CalicchioisadirectorinMcKinsey’sSãoPaulooffice.
5Thissituationcontrastsstarklywiththeoneinmostdevelopedcountries,wherelendershaveaccessto bothpositiveandnegativeinformation,andconsumerswithpositivehistoriescangetmorecreditandlower interestrates.Formoreonthistopic,seeAndreBailey,SuziChun,andJeffreyWong,“Wanted:Asian creditbureaus,”The McKinsey Quarterly,2003specialedition:Thevalueinorganization,pp.16–9.6Smaller,less-sophisticatedretailerswhocan’taffordtooffercreditcardsoftenallowshopperstopayfor purchasesininstallments,withpostdatedchecks.
PhotographsofIndianapparelandmodern-formatandtraditionalstores©DineshKhanna.PhotographsofapparelinBrazilandChina©GettyImages.
Copyright©2007McKinsey&Company.Allrightsreserved.