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Alfamart To Open 200 New Stores In The Philippines

RETAIL / FMCG - Philippines
March 2019

Indonesian mini-mart chain company, Alfamart, is planning to open 200 new stores in the Philippines in 2019, according to a report by Fitch Ratings. Alfamart has partnered with Philippine conglomerate, SM Group, to aggressively expand its footprints in the Philippines, where it currently has 400 stories.

According to the Fitch Ratings report, the country’s mini-mart sector is untapped and has limited competition at present. Existing players only carry limited products, in contrast to Alfamart stores which offer fresh and frozen seafood, personal care and small household appliances, giving it a competitive advantage. 

Alfamart has chosen to expand in the Philippines as the company believes that the country has more potential compared to other South East Asian markets like Thailand and Vietnam. Fitch cites that the Philippines, like Indonesia, are consumer-driven markets with young population and an expanding middle class. Local consumers prefer to buy small amounts of bundled products rather than filling grocery carts.

Through Alfamart’s partnership with the SM Group, the company’s investment risk is mitigated by the strong presence of SM Group in the country. Alfamart will have access to SM Group’s large business network including its 1,729 retail stores nationwide and its strong brand.

(Source: Retail News Asia) 

Puregold To Open 25 New Stores In 2019 Backed By Strong Consumer Spending

RETAIL / FMCG - Philippines
February 2019

The Philippines’ second largest retailer, Puregold Price Club Inc, announced that it will open 25 new outlets as part of its expansion plan. It will use proceeds of its recently concluded PHP 4.69 billion (USD 90 million) share offering to fund the construction of its new stores.

This will be the same number of stores Puregold has targeted to open last year. By the end of September 2017, the company had a total of 352 stores nationwide — comprised of 291 Puregold stores, 13 S&R membership shopping warehouses, 31 S&R New York Style quick service restaurants, nine NE Bodega Supermarkets, and eight Budgetlane Supermarkets.

Consumer-related companies such as Puregold are expected to directly benefit from the tax reform program as working Filipinos have more money now to spend.  The first package of the of the Tax Reform for Acceleration and Inclusion program took effect on January 1. The Department of Finance said the new law will allow employees to pocket higher take home pay, starting with those earning lower than PHP 250,000 (USD 4,800) annually who will now be exempted from personal taxes.

(Sources: Manila Standard; BusinessWorld) 

Vista Land Plans To Adds 7 New Malls To Its Portfolio By 2020

RETAIL / FMCG - Philippines
January 2019

Vista Land & Lifescapes Inc, one of the largest property companies in the Philippines, plans to complete seven new malls over the next two years that will add 274,000 square meters of gross floor area to its existing leasing portfolio of 1.16 million square meters comprising of 26 malls, seven office buildings and 50 commercial centres across the country.. In 2019, the company plans to complete the 54,000 sqm Vistamall North Molino phase 1 in Bacoor, Cavite, the 35,000 sqm Vistamall Mintal phase 1 in Davao City, the 40,000 sqm Vistamall Dasmariñas in Cavite and the 45,000 sqm Vistamall Sta. Maria in Bulacan.

In 2020, Vista Land expects the completion of the 40,000 sqm Vistamall Santiago, in Isabela province, the 40,000 sqm Vistamall Cabanatuan in Nueva Ecija and the 20,000 sqm Vistamall Butuan in Butuan City. The construction of these new malls will be funded with the PHP 10 billion (USD 190 million) worth of fresh capital that was raised via a bond offering in December 2018.

By 2020, Vista Land plans to operate 60 malls that are expected to generate a steady stream of leasing revenues for the company. The company has established presence in about 133 cities and municipalities across 46 provinces. It plans to focus on the development of integrated urban development combining lifestyle retail, prime office space, university town, healthcare, themed residential developments and leisure components.

(Source: Manila Standard)

Lazada Expanding Operations In The Philippines

RETAIL / FMCG - Philippines
November 2018

Lazada’s biggest warehouse and logistics facility can be found in the Philippines but the rise of e-commerce in the country prompted the company’s local unit to build an even bigger and more optimized facility located in Clark, Pampanga and four more warehouses within the country in the next three to five years.

The warehouse facilities, dubbed by the company as fifth-generation facilities, will have double capacity and will be equipped with the latest technology and equipment. Apart from these, the company will also enhance its partnership with logistics partners and increase its distribution centers where products land before they are delivered to customers.

Lazada’s 11.11. Shopping Festival that happened throughout its Southeast Asian markets greatly contributed to its parent company. Alibaba-launched Single’s Day event broke its own record sales from last year.

The Philippine e-commerce market is expected to grow to USD 6 billion in the next three to five years, an average of 17% yearly increase, while Google and Temasek have forecasted it to reach USD 9.7 billion by 2025, surpassing Malaysia, Singapore, and Vietnam. Lazada dominates the e-commerce sector in the Philippines, receiving over 35 million visits per month. 

(source: PTV News, Philippine Daily Inquirer, Business Mirror)

 

Philippines Franchiser of McDonald's Investing In Service Technology

RETAIL / FMCG - Philippines
October 2018

From last year’s capital expenditure of PhP 2 billion for store expansion, the local franchiser of McDonalds in the Philippines, Golden Arches Development Corporation (GADC), is allotting PHP 3 billion (USD 56 million) to modernize existing and future stores and improve service through the use of modern technology. 

Like McDonald’s stores in Europe and the US, the NXTGEN program will feature free Wi-Fi, Split Counter System and Self-Ordering Kiosks which will enable customers to choose and customize order and let them pay via debit and credit cards. Apart from technological innovation, the stores’ interior design and lighting will undergo transformation as well.  

GADC has opened 5 NXTGEN stores in Metro Manila and these will be followed by 5 more stores before the end of the year. The company projects that 10% of its roughly 600 stores will follow the NXTGEN format by 2019, and 70% by 2021.

Meanwhile, the company will be implementing a price increase on its products next year because of the rapidly increasing inflation partly due to the impact of the Tax Reform for Acceleration and Inflation (TRAIN) Law which increased the exicse taxes on fuel and sugar-sweetened beverages. McDonald's Philippines sources 70% of its ingredients locally. However, the management hopes to offset some of the cost increase through improvement in efficiency and productivity.

(source: Manila Bulletin, Rappler)

 

Philippines Reducing Non-Tariff Barriers To Agricultural Imports

RETAIL / FMCG - Philippines
September 2018

President Rodrigo Duterte issued an administrative order on 21 September to eliminate non-tariff barriers to the imports of rice and other agriculture products. The order aims to address the impact of inflation which rose to 6.4% in August, the highest since 2009, and ensure the stability of the prices of agricultural products in the domestic market. Applicable fees will reduced or removed. 

According to the Administrative Order Subject to conditions imposed by applicable laws and consistent with their respective legal mandates, the National Food Authority (NFA), SRA, and DA, in coordination with the Department of Trade and Industry (DTI), will undertake immediate measures to remove administrative constraints and other non-tariff barriers on the importation of agricultural products. 

This includes streamlining procedures and requirements for the accreditation of importers and minimizing the processing time of applications for importation. Traders already accredited will be exempt from registration requirements. It will also allow the import of food products beyond the authorized Minimum Access Volume (MAV) and where applicable, reduce or remove fees in order to ensure their sufficient supply in the domestic market at more affordable prices. 

The order also aims to liberalize issuance of permits and accreditation of traders who want to import rice to break monopoly. It will temporarily allow direct importation by sugar-using industries to lower their input cost. 

DTI and DA have also been asked to take concrete steps to improve logistics, transport, distribution and storage of agricultural products to reduce input costs.

(Sources: PhilStar; officialgazette.gov.ph) 


 

 




 

Competition Body Approves Robinson’s Purchase Of Rustan Supercenter

RETAIL / FMCG - Philippines
August 2018

The Philippine Competition Commission (PCC) has cleared hundred percent acquisition of Rustan’s Supercenters, Inc. (RSCI) by Robinson’s Retail Holdings, Inc. (RRHI). PCC found that there remain enough players in the local market, and that the transaction “does not result in the substantial lessening of the competition in the relevant market.”

In March 2018, RRHI announced a share swap deal with Hong Kong-based retailer Dairy Farm International Holdings, a member of the Jardine Matheson Group and the 100% owner of RSCI, with RSCI swapping shares for primary common shares of Robinsons. The PHP 18 billion (USD 340 million) transaction transferred the ownership of RSCI from Dairy Farm to RRHI, while giving Dairy Farm an 18.25% stake in RRHI.

At the time of the sale, RSI operated more than 75 retail outlets under Rustan's Supermarket, Marketplace by Rustan's, Shopwise, Shopwise Express and Wellcome (Philippines). However, the deal does not include the use of the “Rustan’s” tradename and brandname, which is under license from Rustan Commercial Corp. that is not a party to the merger agreement. 

The RRHI operates a total of 154 branches and is also a retailer with a diverse brand portfolio including supermarkets, department stores, DIY stores, convenience stores, drugstores, toys, among others. The acquisition is in line with the company’s expansion in the retail business.

(Sources: Entrepreneur PH; Manila Standard)

SSI Group To Bring New York-Based Burger Brand To Philippines

RETAIL / FMCG - Philippines
July 2018

Stores Specialists Inc. (SSI Group), the leading specialty retailer in the Philippines with an extensive portfolio of established international brands, has signed development and license agreement to bring in the New York-based burger brand Shake Shack to the Philippines. This will be the restaurant’s first foray into the Southeast Asian market. It is expected to open in the first quarter of 2019.

Both SSI Group and Shake Shack Inc. are currently looking for an ideal location in Metro Manila. They will work with local purveyors and producers to create their signatures  such as the ShackBurger, Shackcago Dog, classic crinkle-cut fries, wine, and frozen custard ice cream. The burger joint has been expanding over the past years in various locations in Japan, Russia, the Middle East, South Korea, Hong Kong and the UK.

SSI Group said that the new venture is in line with its aim of introducing the best of what lifestyle has to offer through global partnerships. The company is a retailer of some of the most well-known international brands such as Kate Spade, Marks & Spencers, Calvin Klein, Gucci, Starbucks, among others.

(Sources: Manila Times; Manila Bulletin)

ShopBack Philippines Partners With Shopee

RETAIL / FMCG - Philippines
June 2018

ShopBack Philippines announced that it has partnered with Shopee, a leading e-commerce platform in South East Asia and Taiwan, which will enable 11 million Filipino Shopee customers to earn cashback from their purchases using the ShopBack mobile app. 

According to ShopBack, Filipino customers are tech-savy individuals and have interest in beauty products, fashion accessories, and travel-related purchases. 

Launched in Singapore as a C2C marketplace in 2015, Shopee has since expanded its reach to Malaysia, Thailand, Taiwan, Indonesia, Vietnam and the Philippines. Today it has a hybrid model including C2C and B2C models and is one of the three largest e-commerce players in the Philippines, along with Lazada and Zalora. Founded in Singapore with support from NUS Enterprise (the entrenreurship arm of the National University of Singapore), ShopBack is a leading player in the e-commerce cashback market of South East Asia. It has around 1,300 region-wide merchants and 650,000 active users. 

(Source: BusinessMirror)

UNIQLO To Open Global Flagship Store In The Philippines, Largest in South East Asia

RETAIL / FMCG - Philippines
May 2018

UNIQLO will open a Global Flagship Store in the Philippines in 2018 which will be the largest UNIQLO store in South East Asia.  The new store will be located in Glorietta 5, Ayala Avenue, in Makati’s central business and commercial district. Set over a sales floor area of 4,100 square meters, UNIQLO MANILA will offer local and international customers a huge shopping area featuring large visual displays and state-of-the-art design concepts. 

UNIQLO is the primary subsidiary of Japanese holding company, Fast Retailing Co., Ltd., the third largest fashion retailer in the world in terms of revenues. The opening of a Global Flagship Store in Manila highlights the importance of the Philippines in UNIQLO’s growth plans worldwide. UNIQLO has chosen Manila as the location of its newest flagship store to strengthen the foundation of its business in the Philippines and in South East Asia - a key global growth engine for the brand.

The store marks the 15th Global Flagship Store for UNIQLO in 11 markets around the world. It will add to Global Flagship Stores in key locations today, including New York’s Fifth Avenue, London’s Oxford Street, Paris’ Opera District, Ginza in Tokyo, and Orchard Road in Singapore. 

(Source: UNIQLO)

Shakey’s Pizza Grows 2017 Earnings By 14%

RETAIL / FMCG - Philippines
April 2018

The Philippines’ leading chained full-service restaurant, Shakey’s Pizza Asia Ventures Inc., ended 2017 with full-year earnings of PHP 762 million (PHP 14.6 million), 14% higher than the previous year’s recurring profits of PHP 669 million (USD 12.8 million). Net income growth was primarily driven by the sustained increase in revenues, successful store network expansion, and maintained profitability despite higher input costs.

In terms of profitability, Shakey’s delivered robust growth of 12% year-on-year for gross profit and 19% for EBITDA. These translated to industry-leading margins of 29% and 20% at the gross profit and EBITDA level, respectively.

Aside from opening several new stores in locations outside of typical first tier cities, the company is also upgrading the look and feel of its existing stores to enhance guests’ dining experience. Likewise, Shakey’s is beefing up its delivery systems to support the growing need for convenience of its customers. For 2018, the company announced plans to open another 20 net new stores in the Philippines which will bring its nationwide store count to 228 at the end of the year.

(Source: Shakey’s)

40 More McDonalds Store in PH This Year

RETAIL / FMCG - Philippines
March 2018

Golden Arches Development Corp, the master franchiser of the McDonald’s fast food chain in the Philippines, is gearing up to expand and open 45 new stores in the country buoyed by its robust economic growth partnered with a young demographic. The company plans to allocate PHP 2 billion (USD 38.2 million) for this expansion plans.

The Philippines is a leading market for McDonald’s in terms of store count in Greater Asia excluding China and Japan. It is also the second highest in Asia in terms of guest count after Hong Kong. GADC remains bullish and optimistic on the country’s growing consumer market despite the tightening competition from the rising number of convenience stores and foods parks.

(Source: BusinessWorld; Philippine Daily Inquirer)

Vista Land Highly Optimistic About Retail Landscape In The Philippines

RETAIL / FMCG - Philippines
February 2018

Vista Land & Lifescapes Inc., the property-development firm led by former politician Manuel B. Villar Jr., said it targets to have 60 malls by the end of 2020, a threefold increase from what it has right now. Currently, the company and its subsidiaries have 22 malls. The company is highly optimistic about the Philippine retail industry, given the strong demand for commercial spaces and housing products, propelled by the stable growth in disposable income, strong overseas foreign worker remittances and sound Philippine macroeconomic fundamentals.

Vista Land has an established presence in about 133 cities and municipalities across 46 provinces, and intends to focus on the development of its communities, integrated urban development combining lifestyle retail, prime office space, university town, health care, themed residential developments and leisure components. The companies owned by Villar are allotting some P175 billion in capital expenditures through 2020, mainly in real estate, property leasing, retail, hotel, education and health.

(Source: Philippines Retailer Association)

Drugstores Increasing Share In The Philippine FMCG Market

RETAIL / FMCG - Philippines
January 2018

Consumer and retail research company Kantar Worldpanel has reported that the accessibility of pharmaceutical channels in the Philippines has helped increased the share of drugstores in the country's fast-moving consumer goods segment.

Kantar Worldpanel cited local drugstore chain Mercury Drug as the fastest growing player in the Philippine FMCG market, ahead of other local retailers like SM, Puregold, Robinsons and Gaisano. Mercury Drug has a vast network of stores compared to other large retailers in the country, and provides more convenience and closer proximity to Filipino consumers. 

Kantar Worldpanel data also showed that FMCG purchases in drugstores grew from PHP 187 (USD 3.6) to PHP 198 (USD 3.9) in 2017 while the shopping frequency increased from 12.8 times to 13.4 times.    

(Sources: The Manila Times; Kantar Worldpanel)

Nike Lauches Google-Powered Hyper Courts In Manila

RETAIL / FMCG - Philippines
December 2017

In a bold bid to raise brand awareness, and driven by an ambition to give Filipino youth a platform to help them get better at a sport they love, Nike has launched a first of its kind initiative in Manila - five new "Nike Hyper Courts". Powered by Google, and developed in partnership with BBH Singapore, each court unlocks exclusive HD basketball content direct to mobile web, and provides basketball enthusiasts across the city with access to training programmes modeled after three of the biggest players in the game - LeBron James, Kevin Durant, and Kyrie Irving.

The content is delivered data-free, including training drills, elevated member activities and the best of Nike global basketball content. For example, videos from experienced coaches relay drills that address power, quickness and versatility tailored to different types of players. The program also learns and makes recommendations from continuous user interaction, which helps promote ongoing progress.

Nike is a leading sportswear player in the Philippines. Basketball is a way of life in the Philippines, and the country is Nike’s third largest basketball market after the US and China. Beyond basketball, the country is seeing a great spurt in popularity of various sports activities such as water sports, cycling and running, which is helping to drive the Filipino sportswear market.

(Source: Nike) 

Phoenix Petroleum To Acquire Philippine FamilyMart

RETAIL / FMCG - Philippines
November 2017

Phoenix Petroleum Philippines has signed a Memorandum of Understanding to acquire Philippine FamilyMart (PFM), the third largest convenience store brand in the country. The MOU was signed between Phoenix Petroleum and SIAL CVS Retailers, Inc. (a joint venture between ALI Capital Corp. of Ayala Land, Inc. and the SSI Group, Inc.), FamilyMart Co., Ltd., and Itochu Corporation, for the planned 100% acquisition of PFM. The acquisition will be subject to the approval of the Philippine Competition Commission.

Phoenix Petroleum’s potential acquisition of PFM complements its retail fuel business, with 518 stations nationwide, and marks its entry into the fast-growing domestic convenience retail market. It is the leading independent oil company in the Philippines, engaged in the trading and marketing of refined petroleum products, including LPG, and lubricants, operation of oil depots and storage facilities, hauling and into-plane services.

PFM is engaged in operating convenience stores under the trademark “FamilyMart” in company-owned and franchise-owned formats in the Philippines. It offers a range of products and services including ready-to-eat or fast food items, convenience store items, auto-loading, bills payment, and ATM services. PFM currently has 68 stores in Luzon.

(Source: Phoenix Fuels)

 

Foreign Brands Mull Entering PH Market Through Duty Free Shops

RETAIL / FMCG - Philippines
October 2017

Premium foreign brands are considering expansion to the Philippines by introducing their products through duty-free shops. The Department of Tourism has said that beauty and fashion brands, as well as food and drink providers, have expressed interest in entering the Philippine market by offering their products through Duty Free shops as the Philippines is seeing a surge of tourists visiting the country.  

The Department of Tourism (DOT) has reported that it is in talks with fashion and beauty brands such as Chanel and Clarins with regard to its market entry via Duty-Free Philippines, as well as with Mondelez (which is known for its best selling food products in the Philippines) to discuss additional expansion to the country. Regent Asia has also expressed its plans to enter Duty-Free Philippines and bring in its cologne and beauty products.

The Department of Tourism has said that with the continuous influx of tourists, particularly the Chinese, the duty-free industry of the country is expected to grow an average of 40% growth in the next decade, as Chinese visitors are known as huge spenders for premium brand products.

(Source: Philstar)

Philippines The Fifth Largest Grocery Retail Market In Asia

RETAIL / FMCG - Philippines
September 2017

The grocery retail market in the Philippines is forecast to grow on average 9.3% year-on-year between 2016 and 2021, which will make it the fifth-largest grocery retail market in Asia, according to IGD, the international grocery research organisation. Grocery retail sales in the Philippines are set to amount to USD 149.99 billion by 2021 from USD 95.98 billion in 2016. This will be driven by a growing population, strong domestic consumption and a buoyant economy. In terms of ranking, the country is expected to move up from sixth place to become the fifth-largest grocery retail market in Asia, after China, India, Japan and Indonesia.

Modern trade currently accounts for about 20% of total grocery retail sales and is growing rapidly. Domestic multi-format retailers dominate modern trade and have shown robust growth over the last five years, with SM Retail, Puregold and Robinsons the largest grocery retailers in the country. SM Retail, for example, is focusing on expanding its mid-sized and small format stores. SM Retail continues to expand beyond Metro Manila; in 2016, 80% of its store openings were outside this area. Meanwhile, Puregold and Robinsons share a similar ambition to expand further beyond the Luzon area with their multi-channel strategies.

7-Eleven, the fastest-growing retailer in the Philippines according to IGD data, is also expanding its stores into smaller towns across the nation. Demand for convenience stores is high as they cater to young people with disposable income who want to shop for their groceries as conveniently as possible.

Meanwhile, online grocery shopping in the Philippines is still in its infancy. Lazada, the leading ecommerce platform in Southeast Asia, has been operating in the Philippines since 2012 and now has six million users in the country. The ecommerce company reportedly plans to go into grocery in the next two years

There is a wealth of opportunity for retailers and suppliers that are looking to grab a slice of the action in this rapidly evolving market in the Philippines

(Sources: IGD; Marketinginteractive.com)

Local F&B Manufacturers Cry For Exemption Of Milk From Excise Sugar Tax

RETAIL / FMCG - Philippines
August 2017

The Philippine Chamber of Food Manufacturers Inc. appeals to the local government for milk products to be excluded from House Bill [HB] 5636 of the SSB (Sugar-Sweetened Beverages) Tax currently being deliberated in the Philippine Senate. They argue that if passed, the prices of this products will increase by up to 30%, making them unaffordable to the already undernourished, low-income part of the population. The chamber said that the SSB Tax will impose an 11% to 26% hike on prices of powdered milk products and an 11% to 34% increase in flavored milk, such as chocolate-flavored brands. According to the Department of Finance, the PHP 10 per liter excise tax on sugar sweetened beverages will generate an additional P47 billion in public revenue in the first year of implementation.

(Source: The Manila Times)

Local Brand “Lucky Me” is Top Consumer Brand for the Second Year

RETAIL / FMCG - Philippines
July 2017

Filipino instant noodle brand “Lucky Me” has once again bested over 460 FMCG brands in the country. International consumer knowledge institution Kantar Worldpanel has named the brand as most chosen by consumers in the Philippines in 2016 and 2017. According to Kantar Worldpanel’s Brand Footprint 2017 article published in June 2016, Lucky Me reaches 99% of the Filipino household and is being purchased at an average of 39 times in a year. It has also received 851 million total consumer reach points (CRPs), Kantar Worldpanel’s own measure of brand strength. The next 4 brands in the top five Filipino consumer brands include Nescafe (at 821 million CRPs), Surf (705 million CRPs), Palmolive (594 million CRPs) and Great Taste (573 million CRPs).

(Sources: Manila Times, Kantar Worldpanel)

Fil-Am Entrepreneur Acquires US Vodka Brand

RETAIL / FMCG - Philippines
June 2017

Filipino-American entrepreneur Rich Cabael has acquired Medea Vodka, a brand endorsed by US basketball legend Shaquille O’Neal, from Medea Inc of Pleasanton, California. The acquisition was made through, Bevriqo, a company formed by Cabael to develop a portfolio of innovative, high quality wine and spirit brands. Medea Vodka is a valuable asset not just because of its award-winning liquid and packaging technology, but because of its existing worldwide distribution network. This move will greatly benefit the international expansion of the buyer’s Filipino brands, VuQo and Haliya, by having us access to major distributors and retailers.

(Sources: Philippines Star, Philippine News)

San Miguel To Enter The U.S.

RETAIL / FMCG - Philippines
May 2017

San Miguel Brewery Inc. (SMB) is planning to enter the US this year with a planned investment of USD 150 million for a new brewery in a joint venture with Kirin Holdings of Japan. The international venture will be on top of the USD 500 million expansion program set for its local operations over the next two to three years.

The US facility would be SMB’s first brewery in the US, a strong export market for SMB at present. The plan to enter the US is to meet rising demand specially in the west coast where there is a large concentration of Filipinos. SMB’s international facilities are currently located in China, Hong Kong, Thailand, Vietnam and Indonesia.

(Sources: Philippines Star, Business Mirror)

Unilever Starts Construction Of Mega Distribution Center

RETAIL / FMCG - Philippines
April 2017

Unilever Philippines has started the construction of a mega distribution center in Cabuyao, Laguna, as it anticipates continued growth in consumer demand for its personal care, food and home care products in the Philippines. The distribution center also forms part of the company’s six-year PHP 6 billion investment commitment in the country.

Spanning 13.7 hectares, the distribution center is located at the heart of Luzon’s manufacturing and industrial hub in Cabuyao, Laguna which will house 130,000 pallets and 97 loading docks. The center showcases future-ready facilities as well as paperless warehouse management systems and safety-compliant storage systems to ensure efficient and sustainable operations.

The continued growth of the Philippine economy, backed by strong domestic consumption and a vibrant retail market, opens a lot of possibilities for Unilever. Despite global uncertainty, the company remains optimistic regarding its presence in the Philippines.

(Sources: Philippines Star, BusinessWorld)

Emperador Profit Rises In 2016 On Higher Brandy, Whisky Sales

RETAIL / FMCG - Philippines
March 2017

Philippine liquor manufacturer Emperador Inc sustained its growth momentum in 2016 and posted a net income of PHP 7.7 billion (USD 155.1 million), an increase of 11% from 2015. The company was able to sustain its growth driven by high-margin brandy and whisky products.

Emperador has been on an acquisition spree to build its global liquor empire that kicked off with the GBP 430 million (USD 729 million) takeover of whisky maker Whyte & Mackay Group Limited in 2014. In February 2016, Emperador sealed an agreement with Beam Spain, S.L. for the purchase of its brandy and sherry businesses for EUR 275 million (USD 298 million).

These acquisitions are crucial in Emperador’s continuous pursuit to maintain its market share in the Philippines and increase its access to other markets. The Philippines ranks among the world’s top 10 liquor consumers per capita, owing largely to the popularity of cheap local brands. However, expensive liquor is gaining prominence due to the country’s 100 million people earning more income.

(Sources: Philippines Star, BusinessWorld, Philippine Daily Inquirer)

URC, Vitasoy Ink Joint Venture

RETAIL / FMCG - Philippines
February 2017

Philippine conglomerate Universal Robina Corporation (URC) has entered into a joint venture with the Vitasoy Group of Hong Kong to unlock the market potential of plant-based beverages in the Philippines. Vitasoy is banking on the distribution network of URC and the strong leadership of the Gokongwei family’s business group in the local food and beverage industry.

The partnership aims to serve up beverages such as soy milk, coconut milk and almond milk, among others, in the country. The joint venture will also explore the potential of plant-based sustainable beverages in the Philippines. URC and Vitasoy will be hoping their combined forces will be enough to grab Philippine market share from tycoon Lucio Tan’s Asia Brewery, Inc., which sells Vitamilk, and smaller players such as Hershey’s Soyfresh and Lactasoy. Asia Brewery boasts that Vitamilk is the leading soy milk drink in the Philippines, with at least an 80% share. 

URC is building on robust growth in sales in key markets to be a leading player in Asia. Combined sales of its branded products in the Philippines and abroad have a 5-year CAGR of 13% from PHP 50.6 billion (USD 1.2 billion) in FY2011 to PHP 92.5 billion (USD 2billion) in FY2016. 

(Source: Philippine Daily Inquirer)

PTT Brings Thai Coffee Chain Brand To Philippines

RETAIL / FMCG - Philippines
January 2017

Thai oil giant PTT is bringing its coffee shop brand Café Amazon to the Philippines as part of its plan to diversify into non-oil businesses in the country. PTT Philippines Corporation said they see business opportunities to take the coffee shop with the standard of service stations in the country.

Nine more Café Amazon shops are expected to open this year in some of the existing PTT stations like the ones in Dasmarinas, Cavite; Lubao, Pampanga; and Sta. Maria, Bulacan. Other existing Café Jungle that was initially introduced at select PTT stations will soon be converted into Café Amazon.

Coffee remains the "go-to" drink of Filipinos, a recent study by Kantar Worldpanel revealed. Besides being the staple drink in the country, the study also found that Filipinos shifted from being moderate to heavy coffee drinkers. Filipinos are buying coffee products close to twice a week — or about 81 times a year. The increase of purchases of coffee mixes has been consistent for the past 2 years, with a growth of 11% in 2014 and 15% in 2015.

(Sources: BusinessWorld, Philippine Daily Inquirer, Kantar Worldpanel)

Julie’s Bakeshop Partners With Pepsi

RETAIL / FMCG - Philippines
December 2016

PEPSI-COLA Products Philippines Inc has signed an exclusive partnership with homegrown-bakery chain Julie’s Bakeshop wherein patrons of Julie’s can buy their baked goods and pastries with Pepsi products including Mountain Dew, Gatorade, and Tropicana juices.

Julie’s Bakeshop is an established bakery chain in the Philippines with over 500 outlets nationwide—including more than 200 in Visayas and more than 100 each in Luzon and Mindanao. The company also aims to double the number of its stores in the next five years by expanding locally to 1,000 outlets.

The partnership is aimed to strengthen the position of Pepsi in the country’s snack business. With the Philippines achieving economic growth rates of around 6% in recent years, consumer purchasing power has increased -- and the snack market along with it. Tokyo research company Fuji Keizai expects the country's snack food market to grow to PHP 16.3 billion pesos (USD 328 million) in 2017, up 19% from 2013.

(Source: BusinessMirror)

Pepsi’s Net Income Grows By 23% In Q3

RETAIL / FMCG - Philippines
November 2016

Pepsi-Cola Products Philippines Inc continues to deliver strong results by riding on its sustained growth momentum in the country. Sales revenues reaching PHP 26.8 billion (USD 538 million) for the nine-month period, representing year-on-year growth of 13%. For the third quarter alone, the company achieved sales revenues of PHP 8.7 billion (USD 175 million) translating to a growth of 14% versus same period last year. Revenue growth continued to outpace volume growth spurred by a strong focus on new product initiatives and revenue management.

To mitigate the impact of higher sugar prices, Pepsi implemented improved productivity particularly related to line efficiencies, value engineering and water/ energy conservation initiatives. Pepsi announced that it remains optimistic about its growth prospects in the Philippines as it continues to operate as a world class food and beverage company in the country.

(Sources: The Philippine Star, Philippine Daily Inquirer)

RFM Grows Nine-Month Profit By 9%

RETAIL / FMCG - Philippines
October 2016

Listed food and beverage firm RFM Corp reported a net income of PHP 683 million (USD 13.7 million) in the first nine months of the year, 9% higher than the same period last year. RFM attributed the company’s strong nine-month performance to improved sales of branded consumers goods under Selecta ice cream, Fiesta Pasta and Selecta Milk. Ice cream sales sustained their double-digit rise behind the push for availability, affordability and visibility despite the onset of La Nina weather phenomenon. RFM expects to sustain this 9% income growth for the last quarter of the year, supported by the increase in demand for pasta among Filipino consumers as well as for milk and ice cream products.

(Sources: The Philippine Star, BusinessWorld)

D&L Unit Ties Up With Bunge Of NY

RETAIL / FMCG - Philippines
September 2016

Oleo-Fats Inc (OFI), a unit of Philippine food and plastic input manufacturer D&L Industries, has inked an exclusive partnership deal with global agribusiness and food company Bunge Ltd to roll out key products in Asia Pacific. Under the agreement, OFI will become Bunge's exclusive commercial partner to import, market, sell and distribute packaged softseed oils into the Philippines.

The partnership is in line with Bunge’s strategy to fully participate in an important and growing destination market such as the Philippines and to leverage on OFI’s clientele that includes quick service restaurant chains, snack food manufacturers, biscuit and confectionery manufacturers, industrial bakeries, and hotels, restaurants and caterers. Bunge on the other hand, will become OFI’s exclusive commercial partner to export, market, sell and distribute coconut oil under its Farm Origin brand into countries in the Asia Pacific region.

(Sources: Philippine Daily Inquirer, PR Newswire)