MYANMAR RETAIL MARKET : Country Study highlights opportunities and challenges

MYANMAR (BURMA)
Country study Phase 1
2018/07/13
Myanmar
Governments are playing an important role in promoting the growth of retailing.
On 9 May 2018, the commerce ministry of Myanmar published Directive 25/2018 to open local retail
and wholesale sectors to foreign investors.
Capital requirement for the joint ventures with at least 20% local ownership to run retail and wholesale
businesses are set at USD 700,000 (EUR 586,010.68) and USD 2mn respectively. Foreign companies are
required to have at least USD 3mn capital to run local retail business and not less than USD 5mn capital
for wholesale business. The capital requirements do not include rental fees. There is no capital
requirements for local companies. The foreign companies and joint ventures as well as local firms with at
least USD 700,000 capital are required to register with the commerce ministry. Registered firms have to
inform the ministry about any new branch within 90 days before the launching. Documents required for
the registration include business plans, the firm's registration, investment consideration, a list of products
that will be sold and distributed, approval from the corresponding regional or township development
committee and approval from the Myanmar Investment Committee. Every trading firms are subjected to
import and distribution taxes. The foreign companies and joint ventures are banned from operating
convenience stores, mini-markets and any retail distribution units with a floor area of below 929 square
metres.
Myanmar Times (The), 14 May 2018
2 2018/07/13 SET MYANMAR : Country Study - phase 1

Myanmar : identity Card
REPUBLIC OF THE UNION OF MYANMAR
Population : 53.4 million inhabitants
Administrative capital : Naypyidaw (0.5 million inhabitants)
Largest City : Yangon (5.2 million inhabitants)
Official language : Burmese
Currency : Myanmar Kyat (1€ = ± 1 600 MMK -T2 2018-)

(1US$ = ± 1 360 MMK -T2 2018-)
Government : Unitary parliamentary constitutional republic

President : Win Myint (since March 28th of 2018)
State Counsellor : Aung San Suu Kyi
Religion : Buddhism 87.9%, Christianity 6.2%,

Islam 4.3%, others 1,6%
Ethnies : Bamar (68%), Shan (9%), Karen (7%),

Rakhine (4%), Mon (2%), others (10%)
Myanmar: synthesis phase 1
STRENGHTS WEAKNESSES
A strategic location between India, China and
Southeast Asia A quarter of the population lives in areas with
security issues
Yangon should have a strong growth of
population in the near future The population of Myanmar is not growing so
fast
Myanmar has a young population
A low urbanization rate
Good literacy and numeracy rates
Myanmar has a small-sized economy
Myanmar’s population living in large cities
could double by 2030 Myanmar has a low Consumer Expenditure
(which should grow fast)
A dynamic growth of the GDP per capita in the
next future
The retail market in Myanmar should reach

71bn US$ in 2020
« Middle Class » would represent between 18

and 23M people in the near future

SUMMARY
(study without visit)
1/ Geographic, cultural and geopolitic aspects page 6
2 / Demography page 11
Population page 11
Urbanization page 16
3 / Socio-economic aspects page 20
4 / Retail and Food market approach page 24

Retail market page 24
Food retail key players page 26
Consumers, food market page 30

Myanmar : geography
A strategic location between India, China and Southeast Asia
Myanmar is bordered by India

and Bangladesh to its west, North Korea
Thailand and Laos to its east, South Korea Japan
China to its north-northeast and China
the bay of Bengal and the
Andaman sea to its south. Bhutan
India Bangladesh
Taiwan
Myanmar
With 676,578 km², Myanmar Bay of
(Burma) Laos
is the largest country of Bengal Thailand

Vietnam Philippines PACIFIC OCEAN
Andaman South
continental southest asia. sea
Cambodia
China sea
Sri
Lanka
Brunei
Malaysia
Myanmar has been a Singapore
INDIAN OCEAN
member of the Association
2 500 Km
of Southeast Asian Nations
Papua
(ASEAN) since 1997. LEGEND Indonesia New Guinea
East Timor
Myanmar (Burma)
other ASEAN countries

Myanmar : geography
14 (+1) administrative divisons
Myanmar is divided into 14 divisions (+ Nay Pyi Taw, the administrative capital
since 2005) : 7 regions & 7 states .
Regions are mainly inhabited by the dominant ethnic group (Bamar).

States are home to particular ethnic minorities.
71% of the population lives in regions and 30% in the states.
Almost 40% of the population live in 3 regions :Yangon, Mandalay and

Ayeyarwaddy.
38.3%
Data source : Myanmar Information Management Unit (MIMU)

Major ethnic groups in Myanmar & population by religion
The population of Myanmar is mainly Bamar (ethnic group) and Buddhist
Sources : Norwegian Institute of International Affairs, 2018
The government of Myanmar would recognise 135 distinct ethnic groups.

Ethnies : Bamar 68% Religions : Buddhism 87.9%
Shan 9% Christianity 6.2%
Karen 7% Islam 4.3%
Rakhine 4% others 1,6%
Mon 2%
others 10%

Myanmar : conflicts, security
A quarter of the population lives in areas with security issues
The shifting
geography of conflict
and ceasefire zones
Norwegian Institute of International Affairs, 2018

SUMMARY
Population page 11


Myanmar : population
The population of Myanmar is not growing so fast
With 53.4M of inhabitants in 2017 (est.), Myanmar is the 5th most populated country in Southeast
Asia, the 12th in Asia and the 26th in the world.
12.7M of households with an average of 4.2 people by household.
The population is not growing so fast compared to the benchmark (annual growth rate of 0.9%).
In 2020 it should reach 55M of inhabitants, almost 60M in 2030.
2,5%
264,0
1,9%
1,6% 1,6%
1,5%
1,4% 1,4%
104,9 1,1% 1,1%

95,5
69,0
41,3 35,7
31,6 24,3 0,3%
16,0 6,9
Data source : World Bank

Yangon should have a strong growth of population
Yangon region should have the strongest growth in the future and would reach more than 10M of
inhabitants in 2030 : +37% in the next 15 years.
The administrative capital’s region, Nay Pyi Taw, should see its population growing fast too : +25%
in the next 15 years.
Ayeyarwaddy and Magway regions and Mon state should decline.

A young population
Myanmar has a young population, especially in rural areas. The median age is 29 and about
51% are under 30 according to the Myanmar Living Conditions Survey (MLCS) 2017.
In 2015, the average life expectancy for a woman is 69 years, compared to 60 years for a
man.
% 70 Y+
% 60 – 59 Y
50 – 59 Y
%
% 40 – 49 Y
% 30 – 39 Y
%
20 – 29 Y
%
%
10 – 19 Y
%
% 0–9Y
%
Source : Myanmar Living Conditions Survey (MLCS) 2017, Myanmar CSO, UNDP, World Bank Group, june 2018
Myanmar : Human Development Index rank #145
and Percentage of Population living in Households with Access to Basic Sanitation
Human Life Gross national GNI per capita

Human Development Index and its components Development expectancy at Expected years Mean years of income (GNI) rank minus HDI
Index (HDI) birth of schooling schooling per capita rank HDI rank
HDI rank Country Value (years) (years) (years) (2011 PPP $)
2015 2015 2015 2015 2015 2015 2014
VERY HIGH HUMAN DEVELOPMENT
1 Norway 0,949 81,7 17,7 12,7 67 614 5 1
5 Singapore 0,925 83,2 15,4 11,6 78 162 -3 4
12 Hong Kong, China (SAR) 0,917 84,2 15,7 11,6 54 265 -2 12
17 Japan 0,903 83,7 15,3 12,5 37 268 10 17
18 Korea (Republic of) 0,901 82,1 16,6 12,2 34 541 12 18
21 France 0,897 82,4 16,3 11,6 38 085 4 22
30 Brunei Darussalam 0,865 79,0 14,9 9,0 72 843 -25 30
HIGH HUMAN DEVELOPMENT
59 Malaysia 0,789 74,9 13,1 10,1 24 620 -13 59
71 Turkey 0,767 75,5 14,6 7,9 18 705 -7 72
73 Sri Lanka 0,766 75,0 14,0 10,9 10 789 21 72
83 Algeria 0,745 75,0 14,4 7,8 13 533 -1 84
87 Thailand 0,740 74,6 13,6 7,9 14 519 -11 88
90 China 0,738 76,0 13,5 7,6 13 345 -7 91
97 Tunisia 0,725 75,0 14,6 7,1 10 249 3 97
MEDIUM HUMAN DEVELOPMENT
113 Indonesia 0,689 69,1 12,9 7,9 10 053 -8 113
115 Viet Nam 0,683 75,9 12,6 8,0 5 335 18 115
116 Philippines 0,682 68,3 11,7 9,3 8 395 -7 114
123 Morocco 0,647 74,3 12,1 5,0 7 195 -4 123
131 India 0,624 68,3 11,7 6,3 5 663 -4 131
138 Lao People's Democratic Republic 0,586 66,6 10,8 5,2 5 049 -2 137
139 Bangladesh 0,579 72,0 10,2 5,2 3 341 8 140
143 Cambodia 0,563 68,8 10,9 4,7 3 095 10 143
145 Myanmar 0,556 66,1 9,1 4,7 4 943 -6 146
LOW HUMAN DEVELOPMENT
153 Cameroon 0,518 56,0 10,4 6,1 2 894 2 154
162 Senegal 0,494 66,9 9,5 2,8 2 250 3 163
171 Côte d'Ivoire 0,474 51,9 8,9 5,0 3 163 -20 172
188 Central African Republic 0,352 51,5 7,1 4,2 587 4 188
Source : UNDP, 2016

Myanmar (#145) is in the « Medium Human Development »
range with other ASEAN countries as Cambodia (#143), Laos
(#138), Philippines (#116), Viet Nam (#115) and Indonesia (#113).
It gained 2 places in the ranking between 2010 and 2015.

Myanmar : education
Good literacy and numeracy rates
Adult literacy and numeracy in 2017 is high among the working age
population, with almost 9 out of 10 adults being literate and
numerate at the union level. Percentage of those
This is comparable to Indonesia (95%), Thailand (93%) and Vietnam aged 15 and above
who report being literate
(93%) and higher than Cambodia (74% in 2012) and Laos (73% in 2012).
*
* The « states », populated by minorities, seem to
be less literate than « regions », mainly inhabited by
the dominant ethnic group (Bamar).
Myanmar : urbanization
A low urbanization rate
The urbanization rate of Myanmar is still low

(about 30%), compared to the benchmark.
Data source : World Bank
Myanmar has 2 cities with over 1M inhabitants :

- Yangon (5.1M)
- Mandalay (1.4M)
Regarding the administrative capital, Nay Pyi Taw,

available sources differ : it should have a
population of 0.5M inhabitants.

Myanmar today is largely a rural country
70% of the population still live in the countryside.
Yangon is the only region more « urban » than « rural ».

Myanmar’s population living in large cities could double by 2030
Myanmar’s cities are

concentrated in the Delta
and the Dry Zone. Cities close
to Yangon and Mandalay
are growing fastest..
Between 2010 and 2030, 10M

more people could live in
Myanmar’s large cities.
Myanmar’s population
living in large cities with
200 000 plus inhabitants,
could double from 13% to
25% of the population in
2030.
« Myanmar’s moment : unique opportunities, major challenges »,
McKinsey Global Institute, june 2013

SUMMARY
Population page 11


Myanmar : economy
Myanmar has a small-sized economy that is progressing
Myanmar has a small-sized economy in

absolute value (69.3 bn US$ in 2017)
compared to benchmark.
Data source : World Bank CAGR : 30.8% CAGR : 2.4%
After a strong growth period from 2005 to

2011 (Myanmar GDP annual growth rate =
more than 30%), the increase of the GDP
slowed : CAGR +2.4% from 2011 to 2017.

Myanmar : economy
A dynamic growth of the GDP per capita in the next future
Myanmar should have the 3rd largest growth of its GDP per capita (US$, PPP), from 2017
to 2020, compared to the benchmark : +15.2% (4.8% annual growth).

Myanmar : economy
Agriculture dominates Myanmar’s economy
Agriculture continues to dominate Myanmar’s

economy, but other countries have shifted towards
industry and services.
Source : « Myanmar’s moment : unique opportunities, major challenges »,

Over half of households are still

conducting some work in agriculture, but
the share of households working in
agriculture is declining and the share of
households relying entirely on non-
agricultural income is increasing in both
urban and rural areas.
SUMMARY
Population page 11


Myanmar : retail
Myanmar is not in the G.R.D.I. 2017 Top 30
A.T.Kearney Global Retail Development

Index (G.R.D.I.) ranks the Top 30
developping countries for Retail
investment, identifying attractive and
future potential markets.
Neither Myanmar nor Laos or

Cambodia is in the list.

Myanmar : retail
The retail market in Myanmar should reach 71bn US$ in 2020
ASEAN retail sales are forecast to reach

US$ 1.3 trillion in 2020, representing an
8.5% annual growth rate.
Myanmar represents 5% of ASEAN retail

market in 2018.
Myanmar’s retail market should have the

strongest annual growth rate in ASEAN.
CAGR = 13.3% vs 8.2% for the other ASEAN countries.
Grocery retailing would represent 3% of total
retailing in Myanmar. (source : Euromonitor International)
Myanmar : food retail key players
- Local pioneer, City Mart Holding Co. Ltd started in

1996 as a supermarket outlet at Aung San Stadium,
Yangon.
Supermarkets under the name of “City Mart”

premium supermarket brand “MarketPlace”
hypermarkets under the name of “Ocean”
convenience stores named “City Express”
pharmacies “Citycare”, bookstore, bakery and café...
- Project to increase supermarkets to nearly 40 and

hypermarkets to nearly 20 in 2018 and convenience
stores to around 200 stores in 2017. Today over 100
cv stores across Yangon with more than 20 outlets format Brand N°
operating 24-hours. City Express is one of the fastest hm hm Ocean 5
sm sm Citymart 23
growing convenience store chains in Myanmar.
Marketplace by Citymart 5
convenience Cityexpress 100
-Highest market share in each retail format
Source : www.cmhl.com.mm/

-CDSG is a conglomerate operating in Food,

Retail, Real Estate, Healthcare, Financial, Portfolio
Investment and Other Services.
First ‘Capital’ Hypermarket location, in Yangon's Dawbon Township
in 2008 (6,000 m²) and 1 at Nay Pyi Taw later in 2011.
Convenience stores under the "Grab & Go" or “G & G” brand since
2012 with 100th store in 2016 (at Yangon, Nay Pyi Taw and
Mandalay). Each “G & G” location offers 24-hour service and basic
consumer goods such as dry food, fast food, stationery and ticketing.
4 Capital Supermarkets : North Dagon, North Okkalapa, Htee Tan, format Brand N°
Aung San Stadium in Yangon
hm Capital 2
sm Capital 4
-With the launch in 2013 of its flagship Capital City mixed-
use development in Yangon convenience Grab & Go 190
- 200 stores in 2018 june. Source : www.cdsg.com.mm/hypermarket-and-supermarket-division/

ABC Group, operator of ABC convenience stores in Myanmar

since 2007 with its first store.
convenience stores named “ABC”
Myanmar, the nation’s largest convenience store operator with

cv store open 24 hours operates 100 convenience stores in
Yangon and Mandalay and plans to build as many as 1000 during
the next years.
ABC 1,000 employees serves over 2,000,000 buyers a year with format Brand N°
more than 2,500 SKU. convinience ABC 100
The group is looking for foreign partners to help it expand into

other categories. Source : www.myjobs.com.mm/company/abc-convenience-store/61805

-Japanese supermarket Aeon has become the first foreign retailer to

enter Myanmar since the 2011 on democratic reforms.
- joint venture in early August 16 with local conglomerate “Creation”
(Myanmar) Group of Cos, to co-operate 14 supermarkets under the
Orange chain, which mainly operates in Yangon. Aeon will provide the
majority of the funding for the venture, which will be capitalized at
$8.1 million.
- Supermarkets AEONOrange
format Brand N°
- Aeon signage (a familiar sight to Japanese consumers) made its
SM AEONOrange 16
Myanmar debut in a largely middle-class area along a major road in
Yangon's North Okkalapa district in oct 2016. The store packs some
8,000 products into a relatively compact 613 sq m of sales-floor space.
-Today 16 stores

Myanmar : consumers
There is a small but noteworthy increase in car ownership in urban areas
Motorcycle ownership has increased continuously over time, and for the first time, more than
half of households in Myanmar reported owning motorcycles in 2017.
In 2005, 9% of households owned motorcycles compared to over half in 2017 (52%). This
expansion can be seen both in rural and urban areas.
In urban and rural areas, motorcycles have been replacing bicycles as a preferred
transportation option.
1/10 urban households reported owning a car or other motor vehicle in 2017, compared to
1/20 in 2005.
Myanmar : consumers
Myanmar has seen a rapid expansion of mobile phones since 2010
The increase in phone ownership over time

has been rapid, and the intensity with which
Myanmar uses smartphones places it at the
forefront of smartphone penetration among
countries with a similar development level.
Yangon Region has the highest share of

smartphones (ahead of Mandalay).
Low ownership of smartphones in Chin

is attribuable to a lower penetration of
the telecommunications network. This
is the state where indicators of physical
access restrictions are most prevalent.
Myanmar : consumers
Consumers are quite satisfied with their condition and optimistic for the future
Consumers in Myanmar would

be among the most optimistic in
the World.
Source : « Vietnam and Myanmar, Southeast Asia’s New Growth Frontiers », BCG, december 2013
Perceptions on present and future economic conditions
Many Myanmar citizens report

that economic conditions are
more difficult than in the past,
but are still optimistic about
the future.
Source : Norwegian Institute of International Affairs, 2018

Myanmar : consumers
« Middle Class » would represent between 18 and 23M people
MAC are Middle income & Affluent

Consumers (BCG). They would be Rich class
between 6 and 8.5M in Myanmar Middle class

(Affluent and Established).
Poor class
If we add « Established » and
« Emerging » classes, we would have
an estimation of the « Middle Class ».
However, all the « Emerging » part of
the Middle Class is not ready to
consume.
1. MAC (Middle Income & Affluent Consumers) defined as Established + Affluent for Myanmar & Vietnam, and
Emerging + Established + Affluent in Indonesia, Thailand, Philippines & Malaysia
Source : BCG CCI models ; BCG analysis
Myanmar’s consuming class could grow more than seven-fold to

around 19M* by 2030.
This would be roughly equivalent to the consuming class in
* Malaysia or the Philippines in 2010.


Myanmar : consumers
Myanmar has a low Consumer Expenditure which should grow fast
ASEAN Myanmar
73 704 US$
9 090 US$
3 164 US$
The disparity in consumer expenditure is large : in 2015 an

average Singaporean household spent US$ 73 704, compared McKinsey Global Institute, june 2013
to US$ 3 164 in Myanmar.
The share of wallet claimed by food would drop
Due to this grave disparity, the ASEAN average spending of
US$ 9 090 per household in 2015 does not portray the typical to about 1/3.
household expenditure in more than half of the ASEAN
member countries. But consumer spending in food would grow in
volume (+50%).
Even within each ASEAN country the income and spending
gap between regions can often be very large.
Myanmar : consumers
Food Expenditure per Capita per Year would be US$ 340 in 2017

Myanmar: potential approach
Countries
DATAS Indonesia Philippines Thailand Malaysia Vietnam Cambodia Laos Algeria Morocco Ivory Coast MYANMAR
Population
Urban Population
Cities > 300 000 inhab.
GDP per capita PPP
Food expenditure
Store UNITS Countries

Store format Indonesia Philippines Thailand Malaysia Vietnam Cambodia Laos Algeria Morocco Ivory Coast MYANMAR
Hypermarket
Supermarket
Hard discount
Convenience
Cash&Carry
Total
Store SQM Countries

Store format Indonesia Philippines Thailand Malaysia Vietnam Cambodia Laos Algeria Morocco Ivory Coast MYANMAR
Hypermarket
Supermarket
Hard discount
Convenience
Cash&Carry
Total

MYANMAR RETAIL MARKET : Country Study highlights opportunities and challenges

Hochgeladen von

Dokumentinformationen

Originalbeschreibung:

Originaltitel

Copyright

Verfügbare Formate

Dieses Dokument teilen

Dokument teilen oder einbetten

Freigabeoptionen

Stufen Sie dieses Dokument als nützlich ein?

Sind diese Inhalte unangemessen?

Copyright:

Verfügbare Formate

MYANMAR RETAIL MARKET : Country Study highlights opportunities and challenges

Hochgeladen von

Copyright:

Verfügbare Formate

MYANMAR (BURMA)

Country study Phase 1

Governments are playing an important role in promoting the growth of retailing.

Myanmar Times (The), 14 May 2018

2 2018/07/13 SET MYANMAR : Country Study - phase 1

REPUBLIC OF THE UNION OF MYANMAR

Population : 53.4 million inhabitants

Administrative capital : Naypyidaw (0.5 million inhabitants)

Largest City : Yangon (5.2 million inhabitants)

Official language : Burmese

Currency : Myanmar Kyat (1€ = ± 1 600 MMK -T2 2018-)

Government : Unitary parliamentary constitutional republic

Religion : Buddhism 87.9%, Christianity 6.2%,

Ethnies : Bamar (68%), Shan (9%), Karen (7%),

The retail market in Myanmar should reach

« Middle Class » would represent between 18

4 2018/07/13 SET MYANMAR : Country Study - phase 1

1/ Geographic, cultural and geopolitic aspects page 6

3 / Socio-economic aspects page 20

4 / Retail and Food market approach page 24

5 2018/07/13 SET MYANMAR : Country Study - phase 1

Myanmar is bordered by India

is the largest country of Bengal Thailand

6 2018/07/13 SET MYANMAR : Country Study - phase 1

Regions are mainly inhabited by the dominant ethnic group (Bamar).

71% of the population lives in regions and 30% in the states.

Almost 40% of the population live in 3 regions :Yangon, Mandalay and

Data source : Myanmar Information Management Unit (MIMU)

Sources : Norwegian Institute of International Affairs, 2018

The government of Myanmar would recognise 135 distinct ethnic groups.

8 2018/07/13 SET MYANMAR : Country Study - phase 1

Norwegian Institute of International Affairs, 2018

Data source : Myanmar Information Management Unit (MIMU)

9 2018/07/13 SET MYANMAR : Country Study - phase 1

1/ Geographic, cultural and geopolitic aspects page 6

3 / Socio-economic aspects page 20

4 / Retail and Food market approach page 24

10 2018/07/13 SET MYANMAR : Country Study - phase 1

12.7M of households with an average of 4.2 people by household.

104,9 1,1% 1,1%

Data source : World Bank

11 2018/07/13 SET MYANMAR : Country Study - phase 1

Ayeyarwaddy and Magway regions and Mon state should decline.

Data source : Myanmar Information Management Unit (MIMU)

12 2018/07/13 SET MYANMAR : Country Study - phase 1

Human Life Gross national GNI per capita

Source : UNDP, 2016

It gained 2 places in the ranking between 2010 and 2015.

The urbanization rate of Myanmar is still low

Data source : World Bank

Myanmar has 2 cities with over 1M inhabitants :

Regarding the administrative capital, Nay Pyi Taw,

16 2018/07/13 SET MYANMAR : Country Study - phase 1

70% of the population still live in the countryside.

Yangon is the only region more « urban » than « rural ».

Data source : Myanmar Information Management Unit (MIMU)

Myanmar’s cities are

Between 2010 and 2030, 10M

18 2018/07/13 SET MYANMAR : Country Study - phase 1

1/ Geographic, cultural and geopolitic aspects page 6

3 / Socio-economic aspects page 20

4 / Retail and Food market approach page 24