Wed, Oct 31, 2018 - Page 4 News List

New Southbound Policy: Consumer goods boast most growth

HIGHEST POTENTIAL:As consumer spending power in Southeast Asia steadily rises, opportunities flourish for Taiwanese enterprises, including for products in the green and halal markets

By Han Cheung  /  Staff Reporter

Visitors attend a three-day fair organized by the Taiwan External Trade Development Council to promote Taiwanese products in Bangkok, Thailand, on Aug. 31.

Photo: CNA

K.K. Orchard (瓜瓜園), a farm-to-store sweet potato enterprise, is looking at a 20 percent increase in profits this year — but its ambitions do not stop there. In June, the company broke ground on a US$700 million sweet potato factory in Tainan, which is to become Taiwan’s largest when it is completed late next year. Its target? The Southeast Asian market.

While K.K. Orchard had been exporting produce to Singapore for more than 10 years, its expansion into the rest of the region was slow due to unfamiliarity with market needs, marketing director Carey Chen (陳慶玲) said.

Two years ago, the company set up a department focusing on the region that interacted with customers. Since then, business in the region has expanded to the Philippines, Singapore, Malaysia and Thailand.

“We started to actively interact with customers in the region regarding sales channels and consumer preferences, and this has opened up more opportunities,” Chen said.

As consumer spending power continues to boom in Southeast Asia, the consumer goods market is becoming increasingly important.

However, Taiwanese exports to Southeast Asia are still mostly dominated by industrial materials.

A China Information Credit Services study released last month includes mostly consumer goods industries in its list of 13 industries that have an advantage in Southeast Asia, such as household appliances and products, recreational equipment, furniture, audio and video equipment as well as food and fashion.

“In the near future, consumer goods and services will be the market segments offering the greatest potential for rapid growth in the region, a situation which should benefit Taiwan’s innovative, flexible SMEs [small and medium-sized enterprises], helping them to establish a foothold in these markets,” the Small and Medium Enterprise Administration said in a report in February.

SHOWCASING TAIWAN

The Taiwan External Trade Development Council (TAITRA) has been organizing expos and exchanges between Taiwan and New Southbound Policy partner countries that aim to increase awareness of Taiwan as well as its products and technology.

The main event is the Taiwan Expo, which is held annually in the government’s six designated priority countries, Indonesia, Malaysia, Vietnam, Thailand, India and the Philippines.

K.K. Orchard has been an eager participant, and it was one of 19 food companies to present its wares in Manila in October last year.

The event was rewarding, with 148 local businesses attending and an estimated US$1.25 million worth of business opportunities conducted.

K.K. Orchard, in particular, received large orders from two major Philippine supermarkets.

Other types of consumer goods also regularly do well in the expos. In this year’s Thailand event that concluded on Sept. 1, Tokuyo received an entire shipping container’s worth of orders for its massage chairs, while attendees rushed to clear the expo’s inventory of dried meat, sweets and nano-tech underwear.

Eco-friendly products have also been a hit at the shows. Immediately after last year’s Taiwan Expo in Indonesia, the Green Trade Project Office took several Taiwanese companies to the Indonesia International Green Technology and Eco-Friendly Products Exhibition, displaying Taiwan’s ability to transform waste into clothing, glass products and other consumer goods.

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