Small, agile and digitally-savvy local companies are shaking up China's fast-growing market for personal care and home goods, according to the latest report by consulting firm Bain & Company.
With names like Pechoin, Marie Dalgar, Three Squirrels and One Leaf, the companies are little known outside China, highlighting how they have emerged amid the transformation of the Chinese retail sector by focusing on local needs and tastes.
Such businesses are taking advantage of lower barriers to entry offered by the rise of the digital economy, Bain said in the report on Chinese shopping trends, co-written with consultancy Kantar Worldpanel. Other factors leading to that growth are major changes to the retail sector, an increase in consumers' desire for lifestyle, health and wellness products, and a willingness to pay a premium for them.
"These brands have a clear vision and an entrepreneurial mission to fulfill unmet needs for Chinese consumers, whether it is for healthy, lifestyle or eco-friendly products," the report said.
"They take a distinctly Chinese approach to building their brands and make their record-setting gains by moving at Chinese speed," it added.
That means focusing on factors including innovation and branding and a targeted message to consumers, the report said, citing the success of YunNan BaiYao's flavored toothpastes.
Authorities in China have been trying to transform the world's second-largest economy into one where consumer spending drives growth rather than the debt-fueled, big ticket infrastructure model of the past.