Importance of General Trade
General Trade, also known as traditional trade, is an indispensable component of Southeast Asia’s economy, with a market value running into billions of dollars. Dominating the retail landscape, General Trade encompasses the countless small, independent shops, markets, and stalls that serve as the lifeblood of commerce in the region. Unlike the more formalized modern trade sectors—such as supermarkets and hypermarkets—General Trade represents a decentralized, grassroots approach to business, deeply embedded in the daily lives of Southeast Asia’s populace.
The significance of General Trade is particularly evident in countries like Cambodia and Laos, where it accounts for an astounding 90% of all trade. These figures underscore the critical role this sector plays in ensuring the availability of goods to vast segments of the population, particularly in rural areas where access to modern retail infrastructure is limited. Across Southeast Asia, General Trade remains the predominant mode of commerce, reflecting both the cultural preferences and economic realities of the region.
Challenges in Obtaining Accurate Information on General Trade
Despite its importance, obtaining accurate and comprehensive data on General Trade in Southeast Asia is notoriously difficult. One of the primary reasons is that much of the sector operates on a cash basis and outside formal business practices. Transactions are often undocumented, and goods typically pass through a complex network of intermediaries before reaching the final consumer. This informal structure, while flexible and resilient, poses significant challenges for those attempting to track and analyze trade flows.
Furthermore, the rural nature of much of Southeast Asia exacerbates these difficulties. Out of the region’s 680 million people, approximately 335 million live in rural areas, often in remote or hard-to-reach locations. The rural population percentages in specific countries highlight the scale of this challenge: Cambodia (75%), Myanmar (68%), Laos (62%), Vietnam (61%), the Philippines (53%), Thailand (47%), and Indonesia (42%). In these areas, traditional trade channels are often the only means of distributing goods, making them crucial but also difficult to study and understand.
Opportunities for Brand Growth in General Trade
Despite the challenges, General Trade presents a significant growth opportunity for brands in Southeast Asia. Many companies have yet to develop a comprehensive strategy for engaging with this sector, leaving a vast potential market largely untapped. Success in this space hinges on several key factors: identifying the right stores, offering an attractive product selection, pricing competitively, and ensuring consistent stock levels.
To capitalize on the opportunities within General Trade, brands must adopt a strategic approach that encompasses portfolio management, brand positioning, channel selection, route-to-market planning, and in-store execution. Developing a detailed plan that addresses these elements is crucial for achieving long-term success.
Frontline Research Group are the right Research Partner
Frontline Research Group (FRG), with nearly three decades of experience, stands out as a leader in General Trade market research. Their deep understanding of the sector and expertise in gathering actionable insights make them an invaluable partner for brands looking to navigate the complexities of traditional trade in Southeast Asia.
By leveraging their knowledge, companies can better position themselves to seize the growth opportunities that General Trade offers.
FRG provide more than just data, they also provide analysis, insights and direction that may be used on a tactical and strategic level.
For more information or demonstration contact Jack de Wet Jack De Wet, Divisional Manager, on +27 (0)86 999 0407 or mobile +27 (0)78 422 9479 or email jack.dewet@frontlineafrica.com.
Click here to read The Complexities of General Trade in Southeast Asia