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SOUTH EAST ASIA AND
SINGAPORE
Julie Haw
Managing Director
Frosts Food & Beverage
Importer & Distributor in Singapore
Fresh Food Production
Restaurants
SOUTH EAST ASIA AND SINGAPORE
Country Population (2017)
Indonesia (263,510,146)
Philippines (103,796,832)
Viet Nam (95,414,640)
Thailand (68,297,547)
Myanmar (54,836,483)
Malaysia (31,164,177)
Cambodia (16,076,370)
Laos (7,037,521)
Singapore (5,784,538)
Timor-Leste (1,237,251)
Brunei Darussalam (434,448)Total Population: About 650 million
8.62% of World Population
48.8% Urban
Median Age 29.1 years
SPENDING POWER OF SOUTH EAST ASIA
Source: http://www.asiamattersforamerica.org
SPENDING POWER OF SOUTH EAST ASIA
Source: http://www.asiamattersforamerica.org
PALATE OF SOUTH EAST ASIA
Diverse Palate
Thailand – Spicy, Sour and Hot
Dominance of Fish Sauce, Lemon Grass
Vietnam – Similar but use of Mint and Milder flavours
Malaysia & Indonesia – Curries with blends of Shallot and Coriander seeds, Fennel Seeds and Cumin seeds. Rounder flavours.
Singaporean Chinese and Malaysian Chinese Cuisine
Different from China Chinese Cuisine
VERY DIFFERENT MARKETS AND ENTRY
MALAYSIA
Import Forms for Meat and Dairy
http://www.dvs.gov.my/index.php/pages/view/359
Labelling Laws
http://fsq.moh.gov.my/v5/ms/guidelines-on-labelling-of-foods-and-food-ingredients-obtained-through-modern-biotechnology/
Nutritional Labels and Ingredients
Importer
Expiry Date
HALAL Body – JAKIM
http://www.halal.gov.my/150216.pdf
INDONESIA (FDA Registration Requirement
1. Certificate of Analysis
2. Health Certificate or Free Sale Certificate
3. Letter of Appointment
4. Sample of products (3 each)
5. Label/Artwork in Pdf (for each product)
6. Ingredient list with percentage
7. Raw Material Specification
8. Flow Chart
9. Product Specification
10. Coding and Shelf-Life
11. GMP or HACCP or ISO 22000 certificate
(if you have but its not compulsory)
Halal Body : MUI
List of recognised Foreign Halal Bodies
http://www.halalmui.org/images/stories/pdf/LSH/LSHLN-LPPOM%20MUI.pdf
VERY DIFFERENT MARKETS AND ENTRY
THAILAND
44 page pdf document
http://agriexchange.apeda.gov.in/IR_Standards/Import_Regulation/Food%20and%20Agricultural%20Import%20Regulations%20and%20Standards%20%20NarrativeBangkokThailand12292016.pdf
Halal Body
http://www.daganghalal.com/Directory/CompanyListing.aspx?intID=501
VERY DIFFERENT MARKETS AND ENTRY
THE SINGAPORE F&B MARKET
BUSINESS RECOMMENDATIONS
INCLUDING SELECTING LOCAL
PARTNERS (DOS AND DON’TS)
SINGAPORE (2016)
Republic since1965 (52 years old)
719 sq km (Latvia 90x)
3.4 million Singaporeans
520 thousand Permanent Residents
7797 people/sq km
Per Capita GDP EUR 45,300
Median Income of resident inclusive of Employer’s ‘social
security contribution’ CPF
EUR 29,500
Tourists 16.4 million in 2016
FOOD SERVICE
QSR (Quick Service Restaurants
– almost all Halal)
Family Restaurant Chains
High End/ Middle Asian/Local Restaurants
High End Western Bistro and Restaurants
Hotel Buffets
Café Chains / Stand alone Cafes
Air-conditioned Food Courts in malls
Hawker Centres / Coffee Shops
MARKET SHARE OF SUPERMARKETS
Supermarkets
Fairprice
DFI (Cold Storageand Giant)
Sheng Siong
Others
12%
37%
Others
19%
32%
MARKET SHARE OF CONVENIENCE SECTOR
Convenience
7 Eleven
Cheers
Petrol Marts
15%
Petrol
Marts
21%
64%
RETAILERS IN SINGAPORE BY FORMAT
Hypermarket (19)
FairPrice warehouse - 1
FairPrice Xtra/Hyper -7
Giant Hyper -10
Supermarket (251)
FairPrice Finest - 23
FairPrice -100
MarketPlace - 6
Cold Storage - 58
Giant Super - 24
Sheng Siong - 40
Small Format (53)
FP Express -25
Giant Express - 28
Convenience (714)
Cheers – 150
Cheers by FP in ESSO - 35
7Eleven – 408
Shell Deli2Go - 56
Caltex Star Mart - 25
SPC (Singapore Petroleum Company) - 40
ONLINE RETAILERS IN SINGAPORE
SELLING TO US
USING THE 4PS TO GUIDE THIS DISCUSSION
PRICE
- Affordability
- Local Alternative (Price of local meals Eur 2 to 5)
- Competitive pricing
- For unknown brands - signal of quality
Pricing – How much would a product cost on the
shelves
• Food Service – depends on type of logistics, size of
drop and value of drop
• Retail
$1 Landed Cost in Warehouse
Divide by 0.8 to 0.65 (Importer/Distributor’s margin)
Divide by 0.9 to 0.8 (Trading Terms)
Divide by 0.8 to 0.65 (Retailer’s Margin)
Multiply by 1.07 (GST – Value added Tax)
SELLING TO US
USING THE 4PS TO GUIDE THIS DISCUSSION
PRODUCT Many competitive products from all over the world. Legislature barriers to entry very low
- Design of Packaging (www.ava.gov.sg)
- Local Habits
- Audience (extremely non-homogeneous)
- Country of Origin
Halal – Study done by the USDA on size of Halal Market in Singapore
https://gain.fas.usda.gov/Recent%20GAIN%20Publications/Halal%20in%20Singapore%20_Singapore_Singapore_3-28-2017.pdf
List of Foreign Halal Certifying Boards
Not available on the internet.
Obtainable by request. Country by country
SELLING TO US
USING THE 4PS TO GUIDE THIS DISCUSSION
Product
Certifications
ISO BRC HACCP IFS
• Nothing is an explicit requirement. But we ask for
them and keep them on record.
• Retail customers ask for Lab Tests for
preservatives. (e.g. Potassium Sorbate)
• Food Service customers may also ask for Process
Flow Charts.
SELLING TO US
USING THE 4PS TO GUIDE THIS DISCUSSION
Product - Packaging
Labelling Guidelines (Straightforward and easily accessible). English. No need for translation.
Packaging : Size / Style / Ingredients/ Nutritional Facts / Allergens
Claims: Low Fat /Low Calorie
https://www.ava.gov.sg/explore-by-sections/food/labelling-packaging-information/labelling-guidelines-for-food-importers-manufacturers
https://www.ava.gov.sg/docs/default-source/default-document-library/a-guide-to-food-labelling-and-advertisements---version-march-2016.pdf?sfvrsn=2n (59 pages of guidelines)
Very Specific and Clear ‘Foods that claim to be an excellent source (including words like “good”, “rich” and “high”) of vitamins and/or minerals are required to contain at least 50% of the daily allowance as laid down in Table I for the relevant vitamin or mineral, per reference quantity for that food as laid down in Table II. ‘
SELLING TO US
USING THE 4PS TO GUIDE THIS DISCUSSION
ALLERGENS
(EXAMPLE OF HOW TO DECLARE)
SELLING TO US
USING THE 4PS TO GUIDE THIS DISCUSSION
PROMOTION
- Traditional Below and Above the Line (what is
allowed by the health authorities and also
landlords)
- Additional displays (market needs differ)
- Wet and Dry Sampling
- Social Media Marketing
PLACE
- Channel of distribution – must be clear and
tactical (Foodservice / Retail / Convenience)
- must also be flexible
PLACE – MARKET ENTRY FEE (INDICATIVE)
FairPrice –- $350 processing fee
- 1st Product $100/store
- Subsequent $30/Sku/Store
2 Advertised Offer (SGD 8000) per year
2 Monthly Offers (SGD 1500)
Cheers –$350 processing fee
1st Product $30/store
Subsequent $10/SKU/store
Cold Storage –- $350 processing fee
- 1st and Subsequent Products $100/SKU/store
- 2 Advertised Offers (SGD 8000)
Packages between 25k to 40k includes A&P for 4 to 5 months
Able to list between 4 to 5 SKUs
DISTRIBUTION LANDSCAPE
Agent / Broker
: May or may not import
: Do not hold stock or very minimal stock
: commodity products
Importer / Distributor
: Import, Stock and Sell
: brand or channel exclusivity important
Wholesaler
: May or may not import
: Minimal Stock
: Small frequent drops (to both Foodservice and Retail)
Retailer
: Direct import, depending on products, may or may not stock
: Often expects brand exclusivity
IMPORT
Relatively simple requirement. Clear guidelines.
Except for Meat – very strict
Preservatives levels low but standard (unlike Japan)
No import taxes except for Liquor and Tobacco (ONLY 7%
GST)
Because of size of market, preferable that product has both
Foodservice and Retail relevance
DISTRIBUTION - LOGISTICS
Small island – deceptively simple logistics
Average store or storage - small and frequent drops
Cost of labour and cost of logistics very high
ERP and bad traffic
Distribution Centres
- Not as common as
in other developed
Countries, but getting
better.
DISTRIBUTION – TEMPERATURE
• Hot and Humid(often 100%) all year round
Often hear people mentioning exceptional logistic
arrangements just for summer…for us it is all year round
• Very tough to avoid breaking the cold chain
- Receiving area very hot with many trucks
- Long waiting period
DIRECT TO RETAILER
Expects brand exclusivity
Certain types of products suitable for selling direct to
retailer (niche/low volume or high volume commodity
like items)
Pick the right retailer for your product (having said that
they are all tending towards attracting a wider spectrum
of customers)
Must be very involved with growing your own brand
Foodservice distribution will not be possible unless
volume allows you to appoint a separate distributor.
COST OF MARKET ENTRY FOR RETAIL
One of the highest in the region.
- Comparable to Hong Kong
Besides Entry Fees there is Trading Terms
Average Credit Days
: 60 days officially (closer to 75)
WHY ENTER SINGAPORE THEN?
We are still the Yellow Pages of South East Asia
WHAT DO WE BUY? WHY? WHAT SELLS
AND HOW TO SELL TO US
Frosts buys
Brioche from France
Brownies from Canada,
American muffins from Norway,
Hotcakes from New Zealand
Yoghurt and Muesli from Australia
WHAT WE THINK OF EUROPEAN PRODUCTS.
France
Italy
Spain
The Netherlands
Germany
Switzerland
What do we know about Latvia?
BEYOND SINGAPORE
FREE PORT - No import or export taxes
Efficient and busy port = one of the
cheapest freight into region
Allows for re-export
Non – meat products can be re-sold into the
region (certification does not allow meat
products to be re-exported)
DOS AND DON’TS
No product import registration system (unlike Indonesia) so relationship is not as permanent in nature
Barriers to switching distributors
- cheap to switch foodservice, but do you know who your existing customers are?
- expensive to switch retail distributor as relisting fees are high, but customers are easily identified
Know your distributors strengths and weaknesses,
but it does not mean they cannot become better in a certain type of distribution. Is there enough value or volume in your line to help them grow that capability?
IN CONCLUSION
GOOD DISTRIBUTOR
= GOOD PARTNER
GOOD DISTRIBUTOR
= IDEAL SET-UP FOR YOUR PRODUCT
GOOD DISTRIBUTOR
= EXCITED ABOUT YOUR PRODUCT
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