American brands are heading where the middle class is growing

American brands are heading where the middle class is growing

Plain and simple, we are seeing more American retail and brand companies from Starbucks to Walmart tie their growth prospects to the rising middle class in Asia, and China in particular. We here at Tematica are not surprised given prospects for discretionary spending to be had compared to here in the US where debt service is taking a greater and greater bite out of disposable income for consumers that are undersaving as they live longer.

Pretty much a no brainer as we see the cross roads of our Cash-strapped Consumer, Aging of the Population and Rise of the New Middle Class investing themes. What we’re seeing is a Harvard Business case study in the making.


American retailers are heading east: They’re opening the doors to brick-and-mortar stores in China, while listing on China’s dueling marketplaces — Tencent and Walmart, for example, brought a small-format supermarket to the city of Shenzhen as the popularity of “small retail” grows in China.

And, like many retailers in China, Walmart’s small-store rollout comes with a digital payments option. Shoppers can pay for items using a program within Tencent’s WeChat while shopping.

Walmart is hardly alone in its brick-and-mortar and eCommerce efforts. Brands from L Brands — which counts Victoria’s Secret in its portfolio — and Ralph Lauren, as well as Starbucks, are bullish on China. Here are their executives on how they plan to build their brands in the country.

Source: American Brands Are Bullish On China |

About the Author

Chris Versace, Chief Investment Officer
I'm the Chief Investment Officer of Tematica Research and editor of Tematica Investing newsletter. All of that capitalizes on my near 20 years in the investment industry, nearly all of it breaking down industries and recommending stocks. In that time, I've been ranked an All Star Analyst by Zacks Investment Research and my efforts in analyzing industries, companies and equities have been recognized by both Institutional Investor and Thomson Reuters’ StarMine Monitor. In my travels, I've covered cyclicals, tech and more, which gives me a different vantage point, one that uses not only an ecosystem or food chain perspective, but one that also examines demographics, economics, psychographics and more when formulating my investment views. The question I most often get is "Are you related to…."

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