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