[Group 12] Market Research Report

8/2/2019 [Group 12] Market Research Report

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MARKET REASEARCH: VIETNAMESE DRIED FRUIT TO SINGAPORE MARKET 2011

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GROUP

12

MARKETREASEARCH:VIETNAMESE

DRIEDFRUITTOSINGAPOREMARKET

GROUP MEMBERS:

1. Nguyn Th Hoi An - 08510500322. L H Dung - 08510500353. Cao Phm Thi H - 08510500664. Nguyn Th Thu Trang - 08510500285. Hong Th Thu Trang 0851050029


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MARKET REASEARCH: VIETNAMESE DRIED FRUIT TO SINGAPORE MARKET2011

Introduction

In Vietnamese, the term mai age is commonly used to indicate the teenage, which proves the

popularity of mai the Vietnamese-style savory dried fruit among Vietnamese young

people. However, up to now, the international reputation of o mai seems still only limited to

foreign visitors who come to our country. Therefore, in our marketing project, we decide choose

it as our export product with the ambition to introduce and spread the love toward this unique

Vietnamese snack to foreign friends.

With the best quality products from the well-established Hong Lam company, Singapore is our

targeted export market after some analysis about the economic condition, cultural factors and

trade policy of the country.

I. Economic audit:1. OverviewSingapore is the 14th largest exporter and the 15th largest importer in the world. The country has

the highest trade to GDP ratio in the world at 407.9 percent, signifying the importance of trade to

its economy. The country is currently the only Asian country to have AAA credit ratings from all

three major credit rating agencies Standard & Poors, Moodys and Fitch. Singapore has a

highly developed and successful free-market economy. It enjoys a remarkably open and

corruption-free environment, stable prices, and a per capita GDP higher than that of most

developed countries. The economy depends heavily on exports, particularly in consumer

electronics, information technology products, pharmaceuticals, and on a growing financial

services sector. Real GDP growth averaged 7.1% between 2004 and 2007. The economy

contracted 1.3% in 2009 as a result of the global financial crisis, but rebounded nearly 14.7% in

2010, on the strength of renewed exports. Over the longer term, the government hopes to

establish a new growth path that focuses on raising productivity, which has sunk to 1% growth

per year in the last decade. Singapore has attracted major investments in pharmaceuticals and

medical technology production and will continue efforts to establish Singapore as Southeast

Asia's financial and high-tech hub.


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GDP (purchasing power parity)

$291.9 billion (2010 est.)

$255.1 billion (2009 est.)

note: data are in 2010 US dollars$257 billion (2008 est.)

GDP - real growth rate

14.5% (2010 est.)

-0.8% (2009 est.)

1.5% (2008 est.)

GDP - composition by sector

Agriculture: 0%

Industry: 28.3%

Services: 71.7% (2010 est.)

Total value of imports: US$310.4 billion

Primary imports - commodities: machinery and equipment, mineral fuels, chemicals, foodstuffs,

consumer goods

Primary imports partners: US (14.7 of total imports), Malaysia (11.6 percent), China (10.5

percent), Japan (7.6 percent), Indonesia (5.8 percent), South Korea (5.7 percent)

2. Market size and past development trends of the confectionery and snack industry

Imports of sugar confectionery amounted to 14,951 tonnes valued at Cdn$ 51.1 million in 2007.

Imports are made for both local consumption and re-export purposes (see Table below).

Singapore's Trade and Consumption of Sugar Confectionery2005 to 2007


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2005

(Tonnes)

2006

(Tonnes)

2007

(Tonnes)

Imports 13,188 1,3546 14,951

Re-exports (3,393) (3,263) (4,593)

Consumption 9,795 10,283 10,358

Source: Singapore External Trade Statistics

Singapore is currently consuming about 10,000 tonnes of imported sugar confectionery per

annum, which comprises the bulk of items being consumed in Singapore. Singapore only has a

small industry involved in the production of the retail packed sugar confectionery items that are

covered by this report.

Per capita consumption in 2007 amounted to about 2.3 kilograms (provisional figure), up from

0.9 kilograms in 2002.

Some key points to note are as follows:

In recent years, sugar confectionery consumption has been growing at less than 5% perannum on a volume basis. Trade sources comment that, on a value basis, the market has seen

higher growth rates. This higher value growth has resulted from consumers upgrading to branded

products that are higher margin products, e.g. breath-fresheners.

The product mix in the market has continued to evolve over the past 5 years. Aggressiveadvertising and promotion has boosted the position of the following in the market:


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o Branded products as opposed to generic products, especially the multinationalbrands; and

o Functional products and products with some form of claim on benefits, especiallybreath-fresheners.

The range of products existing in Singapore is very wide today. It includes chewy softsweets, medicated products, lollipops, breath-fresheners, toffees, hard boiled sweets, and

traditional Chinese sweets/candies etc. There are also a very large number of brands and

packaging sizes.

Sugar confectionery has long been a popular item amongst Singaporean adults andchildren. Teenagers with discretionary spending power and young adults are reported to be the

most dynamic consumers in the market today. Children's products tend to have some

consumption resistance because Singapore mothers are health conscious and so tend to

discourage their children from regular consumption of sugar confectionery.

Trade sources estimate the Singapore market for sugar confectionery to be worth betweenCdn$ 120 million and Cdn$ 160 million at retail level. Obtaining an accurate estimate is very

difficult because of the highly fragmented market structure and fragmented distribution channels

and large number of suppliers.


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II. Cultural audit:1. Overview:Singapore is a cosmopolitan society where people live harmoniously and interaction among

different races is commonly seen. Its culture is best described as a melting pot of mainly

Chinese, British, Malay, and Indian cultures, a reflection of its immigrant history. The pattern of

Singapore stems from the inherent cultural diversity of the island. Each racial group has its own

distinctive religion and there are colorful festivals of special significance all year round.

Although the festivals are special to certain races, it is nonetheless enjoyed by all.

In Singapore, food is also readily and widely available. There are lots of cuisines to offer. We

have, Chinese, Indian, Malay, Indonesian and Western, Italian, Peranakan, Spanish, French, Thai

and even Fusion. It is very common to savor other culture's food and some of the food can be

very intriguing. Indian foods are relatively spicier, whereas Chinese food is less spicier and the


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Chinese enjoy seafood. Malay cooking uses coconut milk as their main ingredient that makes

their food very tasty.

2. Language:Many Singaporeans though not all, are bilingual. Most speakEnglish and another language, most

commonly Mandarin Chinese, Malay, Tamil or Singapore Collonial English(Singlish).

English is the first language of Singapore. The standard form of English spoken in Singapore is

Singapore Standard English, which uses British spellings and grammar. However, there is also a

local dialect of English, Singlish, that is unique to Singapore, though it has close affinities with

the Malaysian dialect known as Manglish.

Singapore is a multi-lingual nation and Singaporeans speak different languages as their first

language. In 2005, 50% of Singaporeans speak Mandarin at home. 32% speak English at home

and 12% speak Malay while 3% speak Tamil at home. Singaporeans who do not speak English

as their home language normally speak it as their second language.

Language most frequently spoken at home (%)[4]

Language 1990 2000 2005

English 18.8 23.0 29.4

Mandarin Chinese 23.7 35.0 36.0

Other Chinese Languages 39.6 23.8 18.2

Malay 14.3 14.1 13.2

Tamil 2.9 3.2 3.1

3.

Religion:Residents of Singapore practice a whole range of religions, depending on their background or

individual choice. The Chinese population in Singapore has a good number of Buddhists,

Christians, and Catholics. The Malay population is predominantly Muslim, while the Indians in

Singapore are largely Hindus. There are also a number of free-thinkers/atheists in Singapore and

the country does not propagate any official religion. However, the country does uphold the
http://en.wikipedia.org/wiki/Bilingualhttp://en.wikipedia.org/wiki/English_languagehttp://en.wikipedia.org/wiki/Mandarin_Chinesehttp://en.wikipedia.org/wiki/Malay_languagehttp://en.wikipedia.org/wiki/Tamil_languagehttp://en.wikipedia.org/w/index.php?title=Singapore_Collonial_English&action=edit&redlink=1http://en.wikipedia.org/wiki/Singapore_Standard_Englishhttp://en.wikipedia.org/wiki/Singlishhttp://en.wikipedia.org/wiki/Manglishhttp://en.wikipedia.org/wiki/Culture_of_Singapore#cite_note-3http://en.wikipedia.org/wiki/Culture_of_Singapore#cite_note-3http://en.wikipedia.org/wiki/Culture_of_Singapore#cite_note-3http://en.wikipedia.org/wiki/Culture_of_Singapore#cite_note-3http://en.wikipedia.org/wiki/Manglishhttp://en.wikipedia.org/wiki/Singlishhttp://en.wikipedia.org/wiki/Singapore_Standard_Englishhttp://en.wikipedia.org/w/index.php?title=Singapore_Collonial_English&action=edit&redlink=1http://en.wikipedia.org/wiki/Tamil_languagehttp://en.wikipedia.org/wiki/Malay_languagehttp://en.wikipedia.org/wiki/Mandarin_Chinesehttp://en.wikipedia.org/wiki/English_languagehttp://en.wikipedia.org/wiki/Bilingual


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values and ethical standards of Confucianism.

4. Singapore consumers general profile:Singaporean consumers are increasingly leading hectic lifestyles, and often do not have

sufficient time to prepare fresh cooked meals. As a result, consumers are looking at purchasing

processed and packaged foods which require limited preparation.

Due to growing Western influence in the country, a number of households are purchasing foods

common to the West such as pasta and roast beef. Households are also consuming more cereals

and breads for breakfast instead of traditional breakfast options (i.e. rice porridge).

More consumers are also adopting the practice of eating a dessert after a meal and as a result,

overall spending on sugar and confectionary products increased by 44% in 2010.

Carbohydrates are a staple item in Singapore cuisine; as a result, bread and cereal products were

the most purchased food items in 2010, making up 21% of total food spending. Meat and seafood

each comprised 17% of total food spending, while vegetables made up 13% and dairy products

accounted for 11% of total food expenditure.

Singaporean consumers are purchasing an increasing number of luxury goods, and are willing to

pay more for imported premium food products. As a result, sales of premium and luxury goods

increased by 18% between 2006 and 2010.

While Singapore consumers are willing to pay a premium for the above food options, they re

still price sensitive and value conscious. How price sensitive Singapore consumers are depends

heavily on the type of product. The majority of consumers would not pay a premium on

necessities, while products that have a unique selling proposition that can be marketed to

consumers are more likely to succeed being sold at a premium.

5. Consumer behavior of the young generation:


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o Singapores teenagers are extremely altruistic, caring deeply about the environment, theircommunity and global humanitarian issues. Accordingly, they prefer brands which align with

their personal value systems.

o They appear to care less about fame and fortune than their predecessors, and to care moreabout enjoying their work.

o Generation Z are green crusaders -the majority of teens identified helping theenvironment as a key concern when selecting their future employers.

o They have a deep connection with Singapore and its characteristics - they seek tounderstand and comment on national issues, and they are proud of Singapores sense of security.

o Flavor platforms and medium that they can mould they do not have set patterns forviewing/ listening. Therefore advertisers should look past traditional prime time.

o They prefer humor in advertising above other characteristics.o Having a sense of community is paramount to Singapores teenagers: They gravitatetowards media channels which provide a sense of LIVE community.

o Singapore teens are informed purchasers the majority of teens want to know whensomething is being promoted to them and they will do their research on a product they have seen

on TV before they purchase it.

o More than three-quarters (91%) of Singapore teens surveyed like advertising - not onlytolerating it, but welcoming it. Advertising is successful 59% of teens acknowledge that

advertising makes them purchase products. More than three-quarters (82%) of teens will go to a

website for further information about a product after watching an advertisement on TV.

III. Trade Barriers:Singapore is essentially a free port for imported confectionery and snacks.

Although Goods & Service Tax of 7% has to be paid by the importer before imported products

can enter Singapore customs territory, no import duties are levied on imported confectionery and

snacks.

All imports of processed food products, including confectionery and snacks, must comply with

prevailing requirements as laid down by the Sale of Food Act and its Regulations. There is free


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entry for processed food products that can comply with local food regulations, which are

enforced by the Agri-Food and Veterinary Authority (AVA).

All imported processed food products may be subject to inspection. Samples may be taken for

laboratory analysis.

An import permit issued by the AVA is required for every consignment of processed food

products imported, including confectionery and snacks. Traders who import processed food

products, including confectionery and snacks, are required to register their business, together

with all required documentation, with the Food Control Division of the AVA, failing which their

application for an import permit will be rejected.

Under a recent change in the regulatory environment to deal with frauds in the area of organic

food and drinks, the AVA has recently issued a directive to importers and declaring agents

advising them that:

Imported food products that are to be retailed as organic in Singapore must bedeclared as organic and be fully supported by appropriate organic certification documents

issued by an accredited overseas certification agency.

Food products labelled as organic foods, organically produced or words of similarmeanings are required to meet the standards established by the Codex Alimentarius

Commission for organically produced foods.

This is relevant to confectionery and snacks because Singapore is importing some organic brands

of confectionery and snacks from North America.

Transportation:

Singapore is a major international transportation hub in Asia, positioned on many sea and air

trade routes. The Port of Singapore, managed by port operators PSA International andJurong

Port, was the world's second busiest port in 2005 in terms of shipping tonnage handled, at

1.15 billion gross tons, and in terms ofcontainerised traffic, at 23.2 million twenty-foot

equivalent units (TEUs). It is also the world's second busiest in terms of cargo tonnage, coming
http://en.wikipedia.org/wiki/Port_of_Singaporehttp://en.wikipedia.org/wiki/PSA_Internationalhttp://en.wikipedia.org/wiki/Jurong_Porthttp://en.wikipedia.org/wiki/Jurong_Porthttp://en.wikipedia.org/wiki/Gross_tonhttp://en.wikipedia.org/wiki/Container_(cargo)http://en.wikipedia.org/wiki/Twenty-foot_equivalent_unithttp://en.wikipedia.org/wiki/Twenty-foot_equivalent_unithttp://en.wikipedia.org/wiki/Twenty-foot_equivalent_unithttp://en.wikipedia.org/wiki/Twenty-foot_equivalent_unithttp://en.wikipedia.org/wiki/Container_(cargo)http://en.wikipedia.org/wiki/Gross_tonhttp://en.wikipedia.org/wiki/Jurong_Porthttp://en.wikipedia.org/wiki/Jurong_Porthttp://en.wikipedia.org/wiki/Jurong_Porthttp://en.wikipedia.org/wiki/PSA_Internationalhttp://en.wikipedia.org/wiki/Port_of_Singapore


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behind Shanghai with 423 million tons handled. In addition, the port is the world's busiest

for transshipment traffic and the world's biggest ship refuelling centre. With all these advantages,

we decide to choose sea freight as our main method to transport our products to Singapore.

Conclusion

As a country with a developed economy, high living standard and youthful population,

Singapore is truly a potential market for our product, which suits very well with the taste of

dynamic and modern young people. Due to the increasing popularity of the Internet and social

networks, we decide to use a combined promotional mix with focus on online and multi-media

advertising.
http://en.wikipedia.org/wiki/Transshipmenthttp://en.wikipedia.org/wiki/Transshipment

[Group 12] Market Research Report

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