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“Convenience stores have grown from 15 to 20 two years back to around 200 currently,” he says. “With more companies and brands coming in,
the consumer choices are increasing.” Consumer purchasing power is potentially threatened by inflation due to currency devaluation, however, and Grover says it’s important that the currency is stabilized.
Wiroj Tanatchasai, Country Manager for Indochina with Nivea, expects the transformation of retail to put pressure on brands.
“The modern trade channel will continue to grow as the local modern trade chains like Citymart and Ocean increase their footprints in the
cities other than Yangon,” he says. “Competition will be extreme as the new players will come in but, at the same time, consumption and penetration will also increase. We are not expecting a
drastic change in the government policies, but the overall business environment is favorable.”
Cash is king in this market, and it is not unusual for bags of cash to be used to make payments even on expensive items such as vehicles and property. Fewer than 10 per cent of people in Myanmar are thought to have a bank account, and there are fewer bank branches per head of population than anywhere else in Southeast Asia. The rapid rise of the mobile internet, however, means
the country may well bypass the roll- out of physical branches, and move straight to a banking system that is predominantly online.
Pal says retailers in nearby India, where the rate of banking is also low, have come up with ways around this – allowing customers to pay cash on delivery for goods bought online. It is also possible for e-tailers to begin with limited and more manageable delivery zones, rather than try to provide national coverage right away.
In the short term – within three years, Kantar expects to see a surge in the number of supermarkets, and new formats such as hypermarkets and petrol-station convenience stores. Beyond that, they predict a sharp rise in e-commerce, beginning with household goods and then bulky packaged goods such as nappies and other non-perishables.
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