Emerging markets slow for retailers

By Jessica Wohl

NEW YORK (Reuters) - Retail and consumer companies have high hopes for breaking through in emerging markets, but growth in countries such as India and China may take longer than expected.

Brazil, Russia, India and China -- collectively known as the BRIC countries -- are seen as the next frontier for rapid growth, especially for U.S. companies experiencing sluggish growth at home. Executives at the Reuters Consumer and Retail Summit in New York this week said that while the opportunities are tremendous, many hurdles remain.

"Each continent is different and it takes a lot of work," said Neil Cole, chief executive of Iconix Brand Group Inc. (ICON.O: Quote, Profile, Research, Stock Buzz), which owns, licenses and markets brands such as London Fog.

"We're looking at possibly licensing out stores, which most American companies have done in Asia and India rather than licensing to department stores because there aren't very many of them," Cole said. "We're also entertaining joint ventures ... and I think we're going to be announcing a few of those over the next 12 months where we would affiliate with powerhouses in the local markets."

Cole said the best places for joint ventures could be in Asia, Latin America and South America.

"We're finding those are very tricky markets," Cole said.

VF Corp. (VFC.N: Quote, Profile, Research, Stock Buzz) is also building its business in developing parts of the world, and has small but growing operations in the BRIC countries. It also just formed a joint venture in India to manage brands like Lee, CEO Mackey McDonald said at the summit.

Catterton Partners, a private equity firm with over $2 billion in capital under management, so far has focused its consumer industry investments in North America.  Continued...