Local brands competition

Author:

I have lately decided to refer to the idiot box as the “genius box” since, for whatever it is worth, it is responsible for generating a plethora of ideas for this column. A few days ago, while watching a particular news channel, the absurdity of the broadcast was starkly obvious, hence this piece. The channel was furiously blasting the Indians for atrocities on the border and the martyring of Pakistani soldiers, which was all good, extremely patriotic and highly commendable. But then, immediately after, during the commercial break, the channel ran an advertisement for an Indian movie to be released shortly by a related party of that very channel; talk about having a conflict of interest!

However, this article is not about the incredulous stupidity of Pakistani cinemas paying our next-door neighbours for the privilege of playing their movies when, at the same time, the nation is engaged in bloody skirmishes on the border with that very country. Although this does bring to the fore a heated debate a while ago about Indian songs being just art, when those music connoisseurs were reminded that the allies had not been playing Bach in the background when they landed on Normandy’s beaches on D-Day.

On the other hand, what did strike a nerve was the realisation that there are only two sets of movies being watched in the country today: those produced either by Hollywood or Bollywood. If there ever was a Lollywood, it is ancient history and there is no conceivable way in which a revival even looks remotely possible. This invasion is evident in the music industry as well; there are hardly any local singers coming up who can expect to have a great future in the local market. Domestic tastes have been corrupted completely. Hollywood and the big four in music who control the global music industry decide what to produce and sell. Accordingly, if the consensus is that, since the domestic entertainment industry cannot compete with the global giants, they and the related culture are better off dead. The cultural impact notwithstanding, there are serious economic consequences for Pakistan in the very near future if this trend, which is endemic across all sectors and industries, continues unabated.

For instance, take the most popular argument: if PIA cannot compete with Emirates and Etihad, it should be sold off or shut down. This is quite comparable with the frame of mind that is as comfortable with shutting down domestic culture and traditions. Jumping to another industry, how many Pakistanis are aware that every time they talk on the phone on any network, a company outside Pakistan is making money? Critically, this trend is not limited to the above few examples; everywhere, in every industry across the country, there are the big few — two, four or six foreign corporations — that have completely cornered the market and in not a single instance is any of the big few a domestic player.

Remember the beverage industry? A few might recall that in the good old days there used to be a couple of local brands that did try to compete with the big two — in this case Coke and Pepsi — and were summarily annihilated. Today, any kind of soft drink being consumed in Pakistan is a brand owned by either one or the other of the big two. There will be those who will argue that the big two have invested a lot of money in bottling plants in the country; obviously it makes great sense for them to invest if coloured aerated water can be sold at high prices and profits can easily be remitted out of the country.

Forget soft drinks; even simple drinking water, which used to flow from taps, is now being consumed from expensively priced plastic bottles, a business segment probably controlled by a different set of the big three. Within two decades, the tap water in Pakistan became so contaminated that now no one wants to risk drinking fresh water. Where was the government when all the reservoirs of fresh water were poisoned under an international conspiracy? Worse still, why has no one told the rural population that fresh water is bad for health? That is an even more serious conspiracy. After all, hypnotic advertisements claiming that bottled water is cleaner and better for health could not have been lying. Pretty soon they will come up with reasons to have distilled water in washrooms and the nation can rejoice because they will set up factories to sell washroom water at exorbitant prices.

On the other extreme of the health equation, the cigarette industry is also controlled by the big two. Admittedly, there is local manufacturing but they simply cater to the low end market where prices and margins are low. The high-end market is completely cornered by the big two, which most likely in short order will get rid of any competition whatsoever. Again, some manufacturing is in Pakistan but the country is puffing away its wealth.

Walk into any store. All that you see on the shelves, in most cases, are brands owned by the big three or four consumer and food companies and none of them are domestic brands. The range of products that these companies offer is indeed remarkable and more commendable is the perception that they have built over time within domestic consumers. If it is not a foreign known brand it is of a lower quality and, worse, if it does not compete in price with the top brand it definitely does not compete in quality either. And this kind of perception, obviously built over years of advertising targeting the conscious and unconscious minds of consumers, is ab initio destructive for any domestic manufacturing even dreaming of competing with the big guys.

Globally, every industry is today dominated by a handful of corporations generally referred to as the big two, four or six. Whether or not the world, someday in the near future, will be controlled by one corporation, having acquired and merged all the rest of the big corporations of every industry, is a question left to international pundits. What is crystal clear is that this foreign invasion of mind, culture and the economy is almost complete. Someone actually commented in all seriousness that if jharoos (brooms) are all Pakistan can make, so be it. Unfortunately, even that is not so simple.

Dear readers, it has always been a sincere effort not to carry over an article to the next week but it is well nigh impossible to conclude this one in the space left over. So, with due apologies, till next week.

The writer is a chartered accountant based in Islamabad. He can be reached at syed.bakhtiyarkazmi@gmail.com and on twitter @leaccountant

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