Marketing Plan for Smartisan

MEMO

To: Dr. George Quek

From: Utkarsh Agarwal

Date: November 8, 2016

Subject: Expansion Proposal in Myanmar

Myanmar also known as Burma a member country of ASEAN, has recently undergone the much awaited political change in its history, with the overwhelming victory of National League of Democracy led by Aung San Suu Kyi in November 2015 has given way to a transition in Myanmar from military rule, which was in effect since 2011, to a democratic government. This has opened the doors for new opportunities in the country after more than 50 years of military rule ().

Myanmar has a population of 51.5 million and the age group of 15 to 28 comprises of approximately 13 million people, which accounts for 40 percent of the working-age population. Population below the working-age also constitutes a huge portion of the population (25%) (). With the help of a good education system and professional training programs, this population segment will cater to the human capital needs of the country to help with economic transformation and growth. In 2014, GDP in the equivalent current USD amount was estimated to be approximately $65.3 billion, with per-capita income of approximately $1270(equivalent current USD) and $4752(equivalent current USD) in terms of purchasing power parity (International Monetary Fund 2014).

A wave of economic reforms has already boosted the economic growth in recent years with the real GDP growth by 8.7% in 2014 and 8.5% in 2015. The real GDP growth in 2016 is expected to be a healthy 8.4%. Myanmar has a demand side economy driven by agriculture and steady increase in FDI. To increase the inflow of foreign investments, government has offered favorable terms such as 100% FDI, profit repatriation and tax holidays. Several foreign banks have been granted license aimed at further liberalizing a sector that was previously off- limits to international players (“Myanmar: Country Profile”, 2016).

In July 2015, World Bank upgraded the status of Myanmar from low-income nation to lower-middle income nation. This upgrade is synonymous to Myanmar’s steadily improving economic growth over the past two years, and specifically due to the increasing income levels of the population. During the same time the US based fast-food giant KFC opened its first outlet in Yangon which is the largest city in Myanmar, becoming the first Western fast-food chains to enter country’s market. The restaurant has gained huge popularity which is one of the many signs that indicate the rapid growth Myanmar’s middle class in recent years. Also, the recent popularity of high-end specialty cafés in Yangon city also reflect the changing appetites and consumption behaviours among the flourishing urban middle-class population. According to a report by Myanmar Retailers Association, during 2012-14 the country’s retail sector posted growth of 7%-15%, depending on different product categories. Key market segments are FMCG, F&B products, and vehicles, among others. Yangon-based weekly newspaper Myanmar Times reported in June 2015 that in the period between mid-2014 and mid-2015 the number of mobile phone users jumped from around 33% to nearly 55% of the population, as per the data from the Ministry of Communication and Information Technology. Two of the three mobile network providers in the country reported that smartphones account for more than 80% of the devices accessing their networks, which suggests with the rise in purchasing power the number of technological savvy users are also on the rise. (“Rising incomes in Myanmar”, 2016).