The ASEAN 2015 has been the talk of the town recently. The government is clamoring over its effect on our economy; various universities and institutions has paved its way in order to prepare for the implementation of the project. But the question remains, how will it affect the local brands? Will it be beneficial or will it pose a threat? Our stand is that it might pose a threat to local brands especially those who are already struggling even before the arrival of the project. This essay aims to address the points that might threaten local brands and what they can do to alleviate its effects.
“One of the main objectives of ASEAN 2015 is to create a single market and production base by ensuring a free flow of goods, services, investment, capital and skilled labor. Which means the country, along with other ASEAN Member States (AMS), should be open to zero import duties for ASEAN products and services by 2015. AMS nationals, meanwhile, should be able to work anywhere in the region without a work permit.” According to an article written by Ian Jester de Vera.
Local brands will be at a disadvantage at the implementation of the project. Foreign brands that are a member of the ASEAN will be able to enter the market with ease. It is expected that Philippine companies will face a stiffer competition when it comes to vying the attentions of their customers. The intense competition will therefore raise the bar for innovation, quality and productivity, which will enable businesses to compete head on with other players. But local brands already struggling even before the implementation of the project will have a harder time adapting and coping with the situation.
Rather as a threat, local companies should see it as an opportunity. Even for struggling local brands. With the implementation of the program, aside from the other countries, Philippine companies will also be able to enter the global market at ease. “Local brands show what we are, Global Brands show what we want to be” according to an article written by Hoult, Quelch and Taylor. Leveraging the ASEAN 2015, companies will be able to enter the highly homogenized world of Global brands where according to Theodore Levitt “Success in world competition turns on efficiency in production, distribution, marketing and management and inevitably becomes focused on price” as written in one of his article in Harvard business review.
Truly, the ASEAN 2015 might pose a great threat to local firms but on the other hand it also gives us a window of opportunity to penetrate another market in a global scale. Many firms fail to compete with global corporations but with the implementation of the ASEAN 2015 it will only make it easy for other countries, including our own, to enter another market and compete in the highly competitive, highly homogenized world of Global corporations.
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CJ 