The Development and Response of Multinational Brands in the Global Industrial Chain

The Development and Response of Multinational Brands in the Global Industrial Chain

Introduction: Advantages and Challenges of Multinational Brands in the Global Industrial Chain In the restructuring process of the global travel luggage industry chain, multinational brands consistently occupy the core leading position, leveraging their long-term accumulated resources and strategic planning. The global travel suitcase market size reached $161.1 billion in 2023, with the CR10 market concentration rising to 42%. Multinational brands, represented by Samsonite and LV, dominate the mid-to-high-end market landscape. These brands have built multiple competitive barriers through global resource integration but also face various challenges such as geopolitical shifts, cost fluctuations, and the rise of local brands. Their development trajectory profoundly influences the direction of the global industrial chain.

I. Core Advantages: Global Layout Builds Competitive Barriers The advantage of multinational brands stems from the deep integration and long-term cultivation of the global industrial chain, forming a competitive system of brand, supply chain, and scale effect.

(A) Multi-Brand Matrix and Technology R&D Barrier Multinational brands cover all market needs through brand segmentation, building a hard-to-penetrate mental moat. Samsonite owns several core brands, including Samsonite (mid-range), Tumi (mid-to-high-end), and American Tourister (mid-to-low-end). In 2024H1, these three brands contributed 51.1%, 23.4%, and 17.4% of revenue, respectively, forming a complementary price-band layout. Based on a century of brand heritage, Samsonite is the only travel luggage manufacturer registered and recognized by IATA. Tumi, with its functional business advantages, occupies the high-end market. This differentiated positioning effectively mitigates the risk of single-market fluctuations. In terms of technology R&D, multinational brands continuously invest in building patent barriers. Samsonite has launched exclusive materials like Curv and Roxkin. Its Cosmolite series, featuring a unique material, achieves a balance of lightweight and impact resistance, ideal for a durable travel bag with wheels. Meanwhile, LV's Monogram canvas craftsmanship has become an industry classic design benchmark.

(B) Global Supply Chain and Channel Network Synergy Multinational brands maximize efficiency through global production and omni-channel layout. On the production side, brands like Samsonite have established production bases in emerging markets such as Vietnam and Mexico, utilizing local cost advantages and free trade agreement dividends to reduce tariffs and logistics costs. On the supply chain side, they achieve global resource allocation through digital management. Samsonite's supplier network covers major global production areas, with real-time coordination of raw material procurement and production planning, shortening the delivery cycle by 30% compared to regional brands. On the channel side, multinational brands have constructed an omni-channel system of "self-operated stores + wholesale + online". As of 2024H1, Samsonite has 1,083 self-operated stores, with DTC income accounting for nearly 40%. The average revenue CAGR of self-operated stores reached a high of 43% from 2020-2023. The online channel further covers mainstream global e-commerce platforms, achieving a comprehensive increase in market penetration for their range of travel luggage bag options.

(C) Scale Effect and Globalized Operation Capability The enormous market size provides multinational brands with significant cost and negotiation advantages. Samsonite ranks first in the industry with an 8% global market share. Its market share in the travel suitcase business reached 15.9% in 2023. Scaled procurement allows raw material costs to be 15%-20% lower than those for small and medium-sized brands, benefiting their mass production of travel trolley bags. Operationally, core management teams possess rich global experience. Most of Samsonite's management has long tenure, deeply understanding the characteristics of different regional markets. In 2024Q1, the revenue contribution from Asia, North America, and Europe was 40%, 33%, and 20%, respectively. This diversified regional layout effectively balances single-market risks. Furthermore, through cross-border M&A, they continually expand their brand matrix and channel resources. After acquiring brands like Tumi and Gregory, Samsonite quickly achieved synergy and integration of technology and markets, further solidifying its industry position.

II. Major Challenges: The Test of Industrial Chain Restructuring under Multiple Pressures Changes in the global economic environment and intensifying industry competition present multinational brands with a triple challenge: cost, geopolitics, and market competition.

(A) Geopolitical and Trade Policy Uncertainty Trade protectionism and regionalization trends escalate supply chain risks. The average tariff in major global export markets has increased by 2.3 percentage points. Policies like the EU's Foreign Subsidies Regulation have led to stricter scrutiny of cross-border M&A. In the first half of 2024, the number of M&A reviews of non-EU enterprises by the EU increased by 35% year-on-year. Although regional supply chain layouts can mitigate some risks, they increase operational complexity. Brands like Samsonite need to establish regional supply chain centers in North America, Europe, and Asia-Pacific. Redundant capacity is maintained at 10%-15%, which significantly increases management costs. Exchange rate fluctuations further amplify profit pressure. Overseas business accounts for over 60% of multinational brands' revenue, and exchange rate changes can impact net profit by 5%-10%.

(B) Cost Volatility and Compliance Requirement Upgrades The price of raw materials and the cost of environmental compliance continue to rise. The annual price volatility of core raw materials such as leather and nylon reaches 10%-15%, and the price volatility of genuine leather materials exceeds 15%, directly squeezing profit margins for hand luggage bag production. Stricter environmental policies bring additional compliance pressure. Regulations like the EU's REACH certification drive green transformation in production. New EU regulations increase annual corporate compliance expenditure by 812%. The Carbon Border Adjustment Mechanism (CBAM), scheduled to be officially implemented in 2026, is expected to increase export costs for related industries by 5%-8%. Although multinational brands have a stronger ability to pass on costs, they still face price competition pressure in the mid-to-low-end market. Some internet brands use low-price strategies to divert mass consumer groups from the cheaper end of trolly bag offerings.

(C) Rise of Local Brands and Market Demand Divergence Local brands in emerging markets are rapidly rising, forming a differentiated competitive landscape, such as TraveRE travel luggage brands in China. Chinese travel suitcase enterprises are accelerating their transformation from OEM to independent brands. The proportion of original designs by enterprises in areas like Baigou has increased to 60%. They are expanding overseas markets through social e-commerce platforms like TikTok Shop, with order volume in Southeast Asia increasing by 40% year-on-year. These local brands are closer to regional consumer demand, offering advantages in product suitability and channel responsiveness. For example, the high-cost-performance casual cabin luggage bag launched for emerging markets directly impacts the mid-to-low-end product lines of multinational brands. At the same time, consumer demand shows trends toward personalization and environmental friendliness. Gen Z consumers' attention to eco-friendly materials and customized products is 67% higher than that of the previous generation. This requires multinational brands to accelerate product iteration. However, their large organizational structure may lead to insufficient decision-making efficiency, making it difficult to respond quickly to segmented market demands.

III. Trend Outlook: Consolidating Core Competitiveness in Restructuring Faced with a complex market environment, multinational brands need to adjust their strategies to maintain advantages and mitigate risks, promoting the transition of the global industrial chain layout towards greater resilience and efficiency.

In the future, the core strategies of multinational brands will focus on three main directions: First, deepening the regionalization of the supply chain. They will build a "multi-center, networked" production system relying on regional free trade agreements like RCEP and USMCA to enhance supply chain resilience. Second, accelerating green and digital transformation. This involves increasing investment in eco-friendly material R&D, aiming for the usage rate of eco-friendly materials in main products to exceed 40% before 2030. Simultaneously, they will optimize full-link efficiency through technologies such as AI demand forecasting and blockchain traceability. Third, strengthening localized operations. They will adjust product design and marketing models according to the consumption characteristics of different regional markets. For instance, launching more price-competitive travel luggage lines in emerging markets while focusing on high-end and personalized innovation in mature markets.

The core position of multinational brands in the global industrial chain is unlikely to be shaken in the short term, but industry competition will become more intense. Brands that can balance global synergy with local responsiveness, and simultaneously consider scale effect and flexible innovation, will continue to lead the industry's development, promoting the evolution of the global travel luggage industrial chain towards a higher quality and more sustainable direction.