Wholesale businesses make a difference in the overall quality of life for many people in Southeast Asia. To be ...
Wholesale businesses make a difference in the overall quality of life for many people in Southeast Asia. To be successful, however, it is important to take advantage of the opportunities different organizations and economic unions provide.
For example, the economic union known as ASEAN makes it possible to take advantage of free trade and other opportunities throughout Southeast Asia and around the world.
Below, you will find a guide on importing and exporting wholesale goods in Southeast Asia through ASEAN.
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The Association of Southeast Asian Nations (ASEAN) wholesale sector plays a major role in the economy of countries across the globe. Wholesale companies are a large part of the ASEAN economy² itself, though it is not widely known to smaller businesses and organizations.
With the largest free-trade area in the world, ASEAN wholesalers produce and sell various products to retailers, manufacturers, and small to midsize professional companies.
The largest commodities are:
Agricultural products, other foods, electronics, beauty supplies, textiles, etc are also in demand and are well worth the investment into the ASEAN market.
ASEAN was founded on August 8th, 1967 in Bangkok, Thailand, when leaders of Thailand, Indonesia, Malaysia, the Philippines, and Singapore signed a document, now referred to as the ASEAN Declaration³. The document was created to promote regional peace and stability and is one of the most successful economic unions in the world.
ASEAN wholesale is devoted to the import and export of goods in Southeast Asia⁵. It connects ASEAN Economic Community⁶ (AEC) with manufacturers, retailers, caterers, etc. They have made it possible for smaller businesses to succeed. Incentives such as lower import duties and tariffs, free-trade areas, and the development of e-commerce have helped the Southasian wholesale market grow. Some of the most popular products in demand include the electronic section, fashion, home decor, and baby products.
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The ASEAN Trade in Goods Agreement⁷ (ATIGA) is an integral part of importing and exporting. It made it possible for smaller wholesale companies to become viable businesses. The agreement allows products in the area to flow freely without trade barriers, resulting in higher trading, stronger economic ties between the Member States, cheaper costs, and more.
Many ASEAN wholesalers use other Asian traders to put their products and merchandise in front of overseas companies looking to import quality goods. Wholesalers have the option of using an Asian trade firm or an ASEAN trade agent. Their purpose is to connect your product with an import client of value. These firms and agents are common practice throughout Asia’s export trade. They allow you to concentrate on making quality products¹¹ while they provide product synopses.
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ASEAN has adapted to the demand of export countries including e-Commerce which serves as an effective medium to sell your products online on various available marketplaces¹². Using modern web-based technology will reduce costs associated with marketing and other expenses. It provides a new medium to reach clients, but areas like shipping, manufacturing, and storage still need to be done on the ground floor, however.
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Trade, which includes both wholesale and retail divisions, accounts for a significant portion of the Gross Domestic Product (GDP) in all ASEAN countries. In addition, trade is the economy's second-largest industry in Singapore, accounting for 20% of GDP¹³.
In the report of the Ministry of Trade and Industry (MTI)¹⁴, Singapore’s economy grew by 14.7 percent year over year in the second quarter of 2021, outpacing the previous quarter’s 1.5 percent increase. Whereas, in the wholesale trade sector, the industry grew by 2.9 percent.
The Singapore government plans to expand and improve the wholesale trade industry by implementing a number of measures, including the Wholesale Trade Industry Map (ITM), which was established with the goal of assisting wholesale enterprises in digitalizing their operations in order to improve worldwide development.
Another important growing sector in Singapore is online retail, which allows for the easy purchasing of a variety of items¹⁵. However, in 2014, only 3.4 percent of total retail purchases were carried online which can be due to the fact of well-developed traditional retail stores.
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ASEAN has a large and respected presence within the five countries it inhabits. Wholesale in Malaysia, however, is one of the most profitable and has the most incentives.
A more developed area of Southeast Asia, Malaysia has had a 7.1%¹⁶ growth in its economy in 2021. With low unemployment rates and low inflation growth, the country has “a favorable investment climate to individuals and organizations wanting to do business,” says Invest in ASEAN¹⁷.
Incentives for ASEAN wholesalers include:
There is also a wide range of products in demand such as:
Not only are these items imported from Malaysia, but they are in demand from ASEAN in general.
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Importing to the ASEAN wholesale sector is also generally thought of as a good investment. Importing to Malaysia¹⁹, for example, does not always require a license.
Each ASEAN country has different import regulations set forth by ASEAN and each government. You can see your countries procedures at ASEAN Briefing²⁰.
There are quite a few benefits to importing goods to ASEAN wholesale markets including the ATIGA and Asian Free Trade Agreements²¹. Within these two agreements, there are many benefits for a small business owner.
Unfortunately, less complicated does not necessarily mean simple, but working within ASEAN in Southeast Asia gives a streamlined approach. Again, this provides more time to devote to your quality product.
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Selling wholesale goods in Southeast Asia through ASEAN comes with many unparalleled benefits. It opens you up to a new worldwide customer base, reduces costs on marketing, taxes, duties, and provides a network of like-minded people.
Small business owners exporting from Thailand or importing to Malaysia have the opportunity to thrive and succeed with the wide range of unique opportunities outlined in the ASEAN declaration.
Reference:
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