Global Briefing

By Desa Philadelphia; David Robinson Sunday, July 21, 2002
    • Wanna Be Like Li?
    Li Ning Sports Goods, China's largest athletic-shoe and apparel company, built brand awareness the same way Nike did — by getting a revered athlete to hawk its products. But while Nike had to hand over millions in endorsement fees to basketball superstar Michael Jordan, Li Ning Sports Goods just put its eponymous chief executive in front of the cameras. Li Ning, a former gymnast, won the hearts of millions of Chinese when he took six medals — three of them gold — at the 1984 Los Angeles Olympics. Since he founded his company in 1988, Li, 39, has doubled as its spokesman, and he is largely credited for a 32% annual average growth that makes the firm a credible challenger in China to Nike, Adidas and Reebok. Li Ning Sports, which has more than 1,000 specialty shops, grossed $108 million in sales last year. So it might be surprising that Li will no longer appear in ads for the company's goods, which bear a logo that looks like Nike's swoosh with a foxtail attached. Li says the affluent Chinese he is now targeting are too young to remember his feats on the pommel horse. "I wish I were as popular as I used to be," Li says with a sigh. It's a fate Jordan, 39, has also suffered. Sales of the Air Jordan are down this year.

    Hey, Aren't These Our Parts?
    China has long had a reputation for disregarding copyrights on music and movies, which are openly peddled on bootleg discs in Chinese cities. But foreign industrial companies doing business in China also have to be diligent about protecting their branded products, as Volkswagen was reminded when some of its parts turned up in the Chery, a popular Chinese-made car. The Chery is part-owned by the Shanghai Automotive Industry Corp., which has a partnership with VW to assemble and market popular cars like the Polo and the Jetta. (SAIC says it bought the VW parts on the open market.)

    Business Glossary
    "Express Kidnapping" is the latest innovation among criminal gangs in Latin America who want to net the most cash in the least time. Here's how it works: criminals accost a well-dressed executive late at night in his car or as he emerges from an upscale restaurant. The victim is escorted at gunpoint to an ATM, where he is forced to make the maximum daily withdrawal — generally between $1,000 and $2,000. The kidnappers sometimes wait and force the victim to make another maximum daily withdrawal after the clock turns over, usually at midnight. A victim who doesn't resist usually isn't hurt and is dropped off in a remote location, often only half an hour or so after he was first grabbed.

    Update
    --SHIPBUILDING WOES
    The surprising success of Poland's Gdynia Shipyard Group was featured in the July 16, 2001, issue of TIME Global Business. The group, which owned the yard where Lech Walesa led his worker's revolt, had shed its communist legacy to adopt market-economy practices such as product specialization and round-the-clock shifts. Now scandal at a competing shipyard may threaten Gdynia's success. The Stocznia Szczecinska shipyard, Poland's second largest shipbuilder, was forced in June to declare bankruptcy. Six of the company's former executives were arrested and charged with criminal mismanagement and fraud that led to $16 million in lost revenue. The yard's 6,000 former workers have been protesting daily, demanding that the government get them their lost wages. The scandal has exposed many of the country's banks and made them nervous about new investments. Gdynia is accused of no wrongdoing, but the Pekao bank in early July withheld a loan from the yard, threatening its ability to compete for new contracts. Gdynia has said it may have to lay off workers.

    House Dressing on That Kelp?
    Not long ago most Americans thought of seaweed in the same way they did, say, pond scum. But U.S. consumers are munching more nori with their sushi. And they are also eating salads and soups with seaweed — imported and domestic. More than 950 tons of seaweed such as hijiki and nori were imported from Japan last year, up from 554 tons in 2000. Larch Hanson, proprietor of Maine Seaweed Co., has seen orders triple in two years. "Seaweed is healthy, and people are more health conscious," says Bill Morrison, owner of Seaweed Cafe in Southwest Harbor, Maine. Other companies, trying to expand the market for the plants, are peddling them as "sea vegetables."

    A Sporting Stock Tip
    If you own stock in a company that puts its name on a sports stadium, it might be time to think about selling. Fans of the Houston Astros flocked to Enron Field, and Tennessee Titans ticket holders went to Adelphia Coliseum for their home games — until earlier this year, when both troubled companies were unable to pay the millions of dollars required to keep their logos in lights. Dean Bonham, a sports-marketing expert in Denver who helps companies buy naming rights, says there are more than 60 multiyear naming deals in the U.S., worth a total of about $3.5 billion. Five of the arenas with such deals have lost or switched sponsors this year alone, and the trend shows no sign of stopping. The MCI Center, home of the Washington Wizards, may be looking for a new name soon if MCI's parent, WorldCom, declares bankruptcy or looks to cut its costs. The news isn't all bad, however. Firms such as Staples (Los Angeles) and HSBC (Buffalo, N.Y.) are doing well with their names on scoreboards.