Site Loader
Rock Street, San Francisco

1

1 Introduction and Overview

We Will Write a Custom Essay Specifically
For You For Only $13.90/page!


order now

? Thailand’s population is 69 million and has a
growth of 0.32% (World Population Review,

2017).

? Fairprice is Singapore’s
largest retailer with over 250 outlets and varying retail formats.

They have a social mission to moderate the cost of living
(Fairprice, 2017).

? The Macro Analysis comprises of the Social,
Technological, Economic, Environmental

and Political factors which would be further detailed.

? Firstly, in terms of the social factors, Thailand has a
urbanization of 51.6% and an

increasing rate of 2.97% (Index Mundi, 2017), exhibiting a
low modern retail penetration

(ASEAN Grocery Retail, 2017).

? With a Gini coefficient of 39.4 (United Nations
Development Programme |Human

Development Reports, 2017), we would be able to cater to
both the upper and middleincome,

bringing in a wider range and broader assortment of stores
(Food Export

Association of the Midwest USA, 2017).

? The literacy rate in Thailand is increasing, sparking the
new generation’s appetite for better

quality products and a more conducive shopping environment
(ASEAN Grocery Retail,

2017)

? As the middle class’ income
rises, and having a GNI of $5640 USD (Gross national income

per capita 2016, Atlas method and PPP, 2016), this suggests
that there is an increase in

consumer spending, higher living expectations and greater
demand for better quality goods.

? For consumption of F&B and clothing, Thais prefer
local brands, citing a disadvantage for

foreign entrants.

? Secondly, in terms of the technological factors, 70.3%
are smartphone users and the highest

smartphone penetration is in Bangkok (eMarketer, 2017)

? Thailand’s national e-payment strategy has
seen the increased use of debit cards as well as

the use of interbank mobile payment system (Open Gov, 2017).

? The increased efficiency and security of these systems
reduced manpower needs, speeding

up the transaction process (Connectngo, 2017).

? Thirdly, in terms of the economic factors, Thailand’s
GDP stands at 406.84B USD,

increasing with an annual growth rate of 3.7% (Trading
Economics, 2017).

? Thailand’s GDP per capita is 5901.4 (Trading
Economics, 2017) and had a growth of 1.241%

in 2016 (The World Bank, 2017).

? Their disposable income is 7550115M THB (Trading
Economics, 2017).

? All these imply that the economy is improving and they
have more money to spend on goods

apart from daily necessities.

? Thailand’s consumer spending is 1296708M THB
(Trading Economics, 2017) and Food &

Non-Alcoholic beverages are forecasted to increase as the
consumer expenditure increases

(Income and Expenditure in Thailand, 2017). This implies
that consumers will still spend

money on food, as it has a direct correlation with the
increase in consumer spending.

? Interest rates stand stable at a low rate of 1.5% in 2017
(Trading Economics, 2017),

signifying the reduction in incentive to save due to lower
borrowing costs and additionally

encouraging consumers to spend.

? This reduces the exchange rate which stands at 1 USD = 32
8350 THB (XE, 2017), this

causes import prices to increase and reduces profit margins
(Pettinger, 2016).

2

? As the government’s
budget deficit sees a downward trend, it suggests the increase in AD,

higher GDP and inflation rate which may potentially cause an
increase in interest rates.

? The inflation rate was 0.86% in 2017 (Trading Economics,
2017), denoting the lower

purchasing power due to increase in prices of goods.

? Fourthly, in terms of the environmental factors, the
government has made improvements in

infrastructure as one of their top priorities.

? Congested roads post a serious problem when dealing with
perishables as additional time is

needed, hence improvements in infrastructure open up
alternative modes of transport.

? Being the largest consumer of plastic bags, it causes
environmental pollution resulting in

resistance in meeting goals of environmental sustainability.

? Thailand is susceptible to natural disasters, negatively
impacting the agriculture.

? Lastly, in terms of the political factors, the
questionable popularity of King Maha

(Forbes.com, 2017); no administration for more than 3 years;
Junta taking much control and

with high corruption, (e.V., 2017), it shows the low
confidence and trust level in the

government as well as the unpredictability in political
events. Hence we always have to be

prepared for the risk that may follow.

? We should register the business with the Department of
Business Development to obtain a

foreign business license. This suggests that we may have to
appoint Thai nominees or issue

preferential shares to retain management control in Thailand
(Boi.go.th, 2017).

? The Internal Analysis comprises of Tangible Assets
(Financial, Human Capital,

Physical, Technological) and Intangible Assets
(Organisational, Innovation,

Reputation).

? The Financial Assets extends to both internal and
external funds.

? The Human Capital Assets include Human Resource
Recruitment and Selection as well

Human Resource Development.

? In recruitment and selection, there are job opportunities
posted on the website; walk-in

interviews for current and new locations and careers fairs
and roadshows (Fairprice, 2017).

? This helps in meeting demands for human capital when
opening a new outlet and we would

be able to tap into the local talent pool.

? Fairprice’s management trainee programme
comprises of a 4-month induction training and

three 2-year rotations to aid in the development of human
resource.

? New leaders and managers for new outlets in Thailand can
be developed leading to career

development and talent mobility. Additionally, the higher
quality staff leads to the

improvement in employee retention.

? The Physical Assets include fresh food DC and centralised
warehousing and distribution

company; 80 farming contracts in Singapore, Thailand,
Australia, Malaysia, Indonesia and a

joint venture store in Vietnam (Fairprice, 2017).

? This implies that we would be able to leverage on its
good and experienced distribution

strategy and channel and adopt its practices in Thailand as
they have prior experience in

venturing overseas. Additionally, with different contracts
all over SEA, we would be able to

obtain resources faster.

Post Author: admin

x

Hi!
I'm Glenda!

Would you like to get a custom essay? How about receiving a customized one?

Check it out