China not the only game in town

US consumer products makers and retailers still see China as a gold mine, but the market has proved a tough one to crack so companies are widening their horizons.

From bath fixtures-maker American Standard to cosmetics and perfume firm Elizabeth Arden, chief executives at the Consumer and Retail Summit in New York say although China remains a key focus, Eastern Europe and Latin America are seen as big growth engines.

American Standard chief Fred Poses said China was "important to us, but not the centre of the universe".

"I think of China as a good place to grow. I don't think it's the only place to grow."

With a fast-growing economy and a population of more than 1 billion people, China is an obvious choice for US companies looking to expand.

But American companies have had mixed results there as they try to navigate sometimes murky regulations and grapple with fierce competition from local players and European and Asian rivals.

The country has drawn huge investment from US retailers in recent years, but companies are finding above-average economic and personal income growth elsewhere too.

Money is starting to flow to those other developing markets. Wal-Mart has just announced its first foray into Central America, buying a one-third stake in Central American Holding.

It has a few dozen stores in China, but with the Central American purchase it now has a stake in a chain of 363 stores in Guatemala, El Salvador, Honduras, Nicaragua and Costa Rica.

Central America's population of about 41 million people is tiny compared with China, and yet Wal-Mart was able to build a big position there far faster than it has in China where government restrictions limit growth.

For Elizabeth Arden, which generates 40 per cent of its business outside the US, China is growing quickly from a small base, but "there's lots of other markets that provide opportunity as well", CEO Scott Beattie says.

"With the brand recognition and awareness, and the fact that more and more of the Chinese population is developing that disposable income ... [China] clearly can be a significant growth driver for us, as well as these other markets."

- REUTERS