Neue Wege für westliche Marken: Ein Verkauf an chinesische Unternehmen könnte ihnen eine bessere Zukunft bescheren

Western business leaders should be aware: Today's acquirers from emerging markets are not passive owners. They learn quickly, expand actively, and create the next global competitors. The most dangerous assumption is not that these companies will ultimately fail, but that Western brands still believe they have the right to ignore companies from emerging markets while the rules of global competition are being reshaped.

When the American household appliance brand SharkNinja was acquired by the Chinese Joyoung Company, observers might have expected a typical story: cultural conflict, dilution of brand identity, and ultimately decline. But that was not the case. SharkNinja has accelerated the innovation cycle, tailored products better to local markets such as Japan and the UK, and overtaken established competitors. Similar surprising developments were seen when Chinese companies acquired Western brands with centuries - old histories such as Flex and SKIL, as well as the Australian premium nutritional supplement manufacturer Swisse. According to our interviews and published reports, these companies controlled by Chinese capital are thriving today.

For Western business leaders seeking growth opportunities in a time of anti - globalization, rising trade barriers, and increasing competition, an interesting question arises: Why do some Western brands thrive after being acquired by companies from emerging markets (often Chinese companies)? Not long ago, these Chinese companies were mainly regarded as cheap producers. This also opens up the paradoxical possibility that selling assets can sometimes be the key to brand revival or even the only way.

Why Western brands want to be sold

This article is based on more than ten years of research and practice by the two authors on Chinese multinational companies in various industries: Professor Ding Yuan has long been engaged in consulting, research, and teaching in the field of cross - border mergers and acquisitions, and Professor Shameen Prashantham focuses on organizational cooperation and the research of companies from emerging markets. The research shows that Western companies sell their brands mainly for two different motives. Although these two situations often seem similar from the outside, the underlying strategic logics are significantly different.

1. Traditional brands with a declining competitive advantage

Many old brands were created in a time when Western companies controlled the entire value chain from manufacturing to design to brand building. Over time, companies have increasingly outsourced business processes, especially to Asia, to achieve higher financial returns. First, manufacturing, then design, and finally parts of research and development were outsourced to external providers as their capabilities continuously improved.

Finally, providers from low - cost regions such as China have developed their own products, which often have similar quality but lower prices. This means that the brand premium of some Western companies has gradually shrunk over time. When growth slows and the differentiation advantage weakens, consultants often advise companies to sell brands that no longer meet their financial goals.

2. Up - and - coming brands that have reached their growth limit

The second group includes some startup brands, mainly from the United States, the UK, or Australia. They have expanded rapidly by focusing on technology and brand building and outsourcing production. In this sense, these companies are "flat - structured from the start". After an initial success in the domestic market, they encountered growth barriers: limited opportunities in fast - growing markets, rising costs, and limited abilities to translate innovations into production. For founders and investors seeking an exit strategy, the acquisition of the brand can open up new growth opportunities.

It is these two motives that lead Western companies to be acquired by Chinese companies.

The acquisitions of Flex and SKIL by Chunghwa as well as the earlier acquisition of Volvo by Geely and the acquisition of Jaguar Land Rover by the Indian Tata Group illustrate the first motive. These brands with centuries - old histories enjoy an excellent reputation, but their operating foundations have been weakened by decades of outsourcing. To rebuild them under Western leadership, the manufacturing and innovation capabilities that have already been lost would need to be rebuilt.

The acquisition of SharkNinja by Joyoung and the acquisition of Swisse by the Health and Happiness Group illustrate the second logic. In these cases, the sale is not intended to rescue a failing brand, but to unleash the growth potential that the previous owners could not fully realize.

In both cases, the sales of assets reflect the discrepancy between the brand's development goals and the owners' capabilities.

Strategies of acquirers from emerging markets

Of course, not all acquisitions are successful. However, when companies from emerging markets successfully revive Western brands, they often follow a unique strategy that is very different from traditional Western integration models. Instead of strict control, they combine light integration with a long - term investment period. In addition, they bring capabilities that many Western companies have lost or never developed: deep control over manufacturing, rapid product development, and digital - first marketing approaches.

Light integration

Successful Chinese acquirers are extremely restrained in business development. Western management teams are usually retained, brand identity is protected, and local market strategies are not immediately fundamentally changed.

Strategic patience

These acquirers also have strategic patience, which is increasingly rare in Western listed companies. They are willing to wait years, not just a few quarters, for the return on their investments. For example, through in - depth conversations with the CEO of Chunghwa, we learned that the company was not in a hurry to rationalize the manufacturing structure after the acquisition of Flex and SKIL. In fact, he explained that the company intends to close a Western factory only after nearly ten years to have time to stabilize operations, build capabilities, and at the same time not destroy the brand identity.

In addition, successful Chinese acquirers also demonstrate the following three organizational capabilities:

1. Manufacturing efficiency: Successful acquirers control the entire value chain, which allows them to save costs through increased operational flexibility. By integrating supply, production, and purchasing decisions, they can quickly respond to changes in demand or product design, thus avoiding the efficiency delays and coordination problems that often occur in Western companies that rely on scattered outsourcing networks.

For example, the CEO of Chunghwa explained to us that the acquisition of Flex and SKIL enabled the company to reorganize production processes, optimize factory utilization, and implement stricter quality controls at multiple production sites.

2. Design and research and development capabilities: Rapid design iterations are closely combined with extensive research and development to achieve faster product development and more reliable implementation. The acquisition of SharkNinja by Joyoung illustrates this approach. From interviews with the CEO of Joyoung and his management team, we know that thanks to its deep technical expertise and control over manufacturing, Joyoung has accelerated the design cycle and adapted products to local conditions. In Japan, where apartments are smaller and consumers prefer low - noise devices, SharkNinja has redesigned its products and overtaken established competitors such as Dyson.

3. Digital marketing knowledge: Many acquirers from emerging markets operate in a highly developed digital ecosystem. They bring capabilities in data - driven product development, social media marketing, and e - commerce operations that Western brands often lack.

After the acquisition of Swisse, the Health and Happiness Group has applied these capabilities not only in China but also in Western markets. From its management team, we learned that the Health and Happiness Group has successfully revived the American pet food brand Solid Gold and the pet nutritional supplement brand Zesty Paws through stronger online marketing and e - commerce strategies. This shows that the digital capabilities learned in China can be effectively transferred to other markets without diluting the brand position.

Although many Chinese companies still need to learn how to deal with consumer behavior and institutional differences in foreign markets, they can offer many advantages in terms of improving manufacturing efficiency, strengthening product innovation and design, and developing data - driven digital marketing and e - commerce strategies to support brand growth. It can be said that the capabilities of Chinese companies essentially reshape the entire "Smile Curve" and create value not only through manufacturing but also through design and marketing.

Lessons for Western companies:

Strategic options to consider

For Western business leaders, the phenomenon of successful brand revival by companies from emerging markets triggers a review of their strategies for dealing with brand decline. Selling a brand is no longer simply regarded as a failure; on the contrary, continuing a brand without the required capabilities may even bring greater risks.

Basically, it sounds an alarm for Western brands that they should avoid relying completely on the "Smile Curve" (outsourcing) strategy and instead strengthen their core activities - if it's not too late. Business leaders tend to regard the success of outsourcing as proof of their own abilities and believe that brand values can exist independently of operational activities. However, efficient outsourcing has led to a loss of internal expertise and weakened many companies strategically. Brands rely on continuous innovation, reliable implementation, and cost control, and these capabilities cannot be permanently sourced from providers. In the face of increasing geopolitical tensions, vertical integration remains of crucial importance.

More specifically, the phenomenon of brand revival by companies from emerging markets offers Western business leaders different strategic options, depending on the characteristics and situation of the company.

1. Smart exit

For traditional brands with a declining brand premium, leaders must decide whether to invest in vertical integration capabilities or accept that another owner may be better able to revive the brand. A "smart exit", for example, by closing a licensing contract with an acquirer from an emerging market to preserve long - term value, may be preferable to a long - term brand decline.

For example, Philips sold its household appliance division to the Chinese Hillhouse Capital. Thanks to a 15 - year licensing contract for the Philips brand, the company expects to generate revenues of about 700 million euros in the next few years.

2. Sale to achieve economies of scale

Up - and - coming brands that have reached their growth limit must ask themselves whether independence restricts their future. Acquisition or majority investment by a new partner (such as an acquirer from an emerging market like China) can open up new markets for the brand and provide operational support.

A deal that retains control over customer contact (which is realistic due to the light integration approach of Chinese acquirers) and at the same time retains a minimum stake can open up new growth opportunities for the acquired brand.

3. Partial exit

Brands with a still high brand premium can choose financial localization instead of a complete sale. Like Yum China or Anheuser - Busch InBev in the Asia - Pacific region, spinning off regional business units can increase flexibility while maintaining strategic influence.

In some cases, selling the majority stake while retaining a significant minimum stake can enable Western companies to exert influence on corporate governance, brand building, and sustainability standards even after transferring control. After Starbucks saw its market share in China decline from about 34% in 2019 to about 14% in 2024, it decided to sell the majority stake to the Chinese investment fund Boyu Capital while retaining a considerable minimum stake. This allows it to both leverage its global brand expertise and achieve financial gains. Sony transferred control of its TV division to the Chinese TCL while retaining brand influence through the minimum stake.

When choosing these paths, it is important to make well - considered decisions instead of gradually declining by assuming that yesterday's globalization logic still holds. In a world of anti - globalization, selling a brand no longer necessarily means failure. In some cases, it is the only way for a brand to survive and thrive.

Western business leaders should be aware, however: Today's acquirers from emerging markets are not passive owners. They learn quickly, expand actively, and create the next global competitors. The most dangerous assumption is not that these companies will ultimately fail, but that Western brands still believe they have the right to ignore companies from emerging markets while the rules of global competition are being reshaped.