We want have a look at the Thailand wine sector, we focus here at the size and structure. That will help us to create our marketing strategy.
Thailand, the Southeast Asia‟s second largest economy, is the world‟s number one exporter of natural rubber, rice, frozen shrimp, canned tuna, canned pineapples and cassava, and the number two exporter of sugar.
In 2010, wine in Thailand was affected by AFTA – the Asian Free Trade Agreement – which allows 0% imported tax for wine from Asian countries. As a result of this, wine became more varied with wines from many countries becoming available, especially New World wines. Thai wines were gaining more acceptance and becoming popular among consumers. On the other hand, from the perspective of consumer behaviour, many Thai consumers were becoming more familiar with drinking wine and wine players were becoming more aggressive in presenting and promoting products.
It is expected in the year 2011, Thai economy will continuously to expand at the normal range of 3.5-4.5%. The main driver contributed to this growth is domestic spending, both consumption and investment, which are projected to grow from 2010. Strong purchasing power is also expected due towage increases.
The country‟s retail sector is a vital component of the Thai economy and retail sales in Thailand are predicted to continue growing despite concerns surrounding the world economic downturn and domestic political uncertainty. Retail sales accounted for 16 percent of GDP and the industry accounted for 15% of total employment. According to the Thai Retailers Association, the retail market for 2011 will grow by 7 percent with a gradual improvement of consumer spending in 2011.
Over 90 percent of urban Thai shoppers use convenience stores and they visit them regularly, an average of 13 times a month. It is reported that an average of 6 million customers visit convenience stores each day. That the reason why Thai convenience retail is enormously competitive. There are:
1.CP All’s 7-Eleven
2.Tesco Lotus Express
- UK-based Tesco with its Tesco Lotus stores.
- Big C Supercenter of Casino Guichard-Perrachon SA of France.
- Carrefour of France.
- Netherlands-based Makro.
In November 2010, Big C Super Center acquired the business operations of the Thailand Carrefour Group, paying a value of $1.2 billion. As a result of the acquisition there will be only two hypermarkets left, which are BigC and Tesco Lotus dominating the country‟s hypermarket segment. About 90 percent of urban Thai shoppers use hypermarkets at least once a week. They average spent is about $150 per month on retail products, of which 49 percent was spent on fresh foods.
The competitive supermarket segment is mainly concentrated in Bangkok where higher levels of consumer income and sophisticated customer base support this retail format. These supermarkets has more of an medium to upper market positioning, offering a wide range of high quality and broader assortment of local and imported processed food, fruits and vegetables, meat and seafood, and beverages. They use price strategies and loan extensions to low-income consumers led to the closure of many traditional stores. Modern retailing accounts for approximately 70 percent of total retail sales.
HRI Food service sector
Hotels, resorts, restaurants and institutional contracts are the heavy users of imported food for food preparation and ready-to-eat meals at restaurants, catering services for airlines and cruise lines. This is because this sector attracts middle to higher income Thais, Thai corporate businessmen, resident expatriates, and tourists. Consumer expenditure on hotels and catering per capita was $164, a 4.65 percent decreased from the previous year. Thailand‟s HRI food service sector is inevitably reliant on the tourism industry. Food and beverage sales in hotels and resorts account for about 30 percent of total revenues. The average rate of imported food versus locally produced food in the entire HRI sector is 30 %.
Food Processing Sector
Thailand‟s food processing industry has developed rapidly throughout the past decade and is one of the most developed in South East Asia.