Spire discusses retail trends across emerging markets at International Franchise Conference 2018.

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WHAT’S HAPPENING ARROUND THE WORLD?

3. 3
Income per capita
Source: Spire’s Secondary and Primary Research, World Bank, IMF
GLOBAL ECONOMIC PERFORMANCE IN 2017
Europe
GDP : USD 19,931 billion
GDP Growth Rate : 2.2%
Population: 742 Million
26,961
USD
North America
GDP : USD 22,248 billion
GDP Growth Rate : 2.2%
Population: 489 Million
45,501
USD
East Asia
GDP : USD 19,268 billion
GDP Growth Rate : 5.4%
Population: 1,648 Million
12,019
USD
South East Asia
GDP : USD 2,722 billion
GDP Growth Rate : 5.1%
Population: 648 Million
4,216
USD
South Asia
GDP : USD 3,107 billion
GDP Growth Rate : 6.6%
Population: 1,868 Million
1,797
USD

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WHAT’S HAPPENING ON RETAIL INDUSTRY?
1.85
2.30
2.84
3.45
4.14
22.1
23.5
24.9
26.3
27.7
2016
2017
2018*
2019*
2020*
- 5.00 10.00 15.00 20.00 25.00 30.00
Total Sales Retail (USD Trillion) E-Commerce Sales (USD Trillion)
8.37%
9.79%
11.41%
13.12%
14.95%
GLOBAL SALES RETAIL
Percentage
Asia Pacific
RETAIL SALES VALUE PER REGION (IN TRILLION USD)
2016
2017
2018
Source: Spire’s Secondary and Primary Research, World Bank, IMF, Statista, Deloitte, Bloomberg, Eurostat
10.3
9.3
8.4
North America
5
4.8
4.6
Western Europe
3.3
3.3
3.2
Latin America
1.7
1.6
1.6
Africa & Middle East
0.8
0.7
0.7

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Together with other retailers from emerging markets, China, Japan and other
Asia-Pacific retailers are gaining more markets within 10 years
Share of Top 250 Retail Revenue
10%
40%48.30%
1%1%
Asia Pacific Europe North America
Latin America Africa/Mid.East
15%
34%
47.80%
1%
2%
2006 2016
HOW’S THE PLAYERS IN RETAIL
INDUSTRY?
TOP 250 GLOBAL RETAILERS
(2016)
JD.com, Inc
(28th)
Revenue: US$35,777 Million
Operation
Format: Non-Store
(E-commerce)
Countries of Operation: 1
Tesco (11th)
Revenue: US$ 72,390
Million
Operation Format:
Hypermarket
Countries of
Operation: 8
Source: Spire’s Secondary and Primary Research, Deloitte
Walmart (1th)
Revenue: US$ 485,873 Million
Operation Format: Hypermarket
Countries of Operation: 29
Amazon (6th)
Revenue: US$ 94,665 Million
Operation Format: Non-Store
(E-commerce)
Countries of Operation: 14
SEVEN & I
Holdings Co. Ltd
(20th)
Revenue: US$ 51,385
Operation Format:
Convenient Store
Countries of Operation: 20

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TOP 250 GLOBAL RETAILERS
(2016)
Indomaret (212th)
Revenue: US$ 4,435 Million
Operation Format:
Convenient Store
Countries of Operation: 1
Watson (51th)
Revenue: US$ 19,517 Million
Operation Format: Drug
Store
Countries of Operation: 25
CP All Plc. (75th)
Revenue: US$ 12,754 Million
Operation Format:
Convenient Store
Countries of Operation: 1
Central Group (118th)
Revenue: US$ 8,062 Million
Operation Format:
Department Store
Countries of Operation: 6
SM Investments
Corp. (166th)
Revenue: US$ 5,804 Milion
Operation Format: Hypermarket
Countries of Operation: 1
HOW’S THE PLAYERS IN RETAIL
INDUSTRY?
Source: Spire’s Secondary and Primary Research, Deloitte

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In 2016, used by 19 million customers in USA
Starbucks Mobile Order & Pay- Customer can
order and pay their drinking in advance. This eliminates
the waiting and increase customer’s convenient
Starbucks Reward App – by allowing customers
to redeem their points within the app, will increase the
customer attracting and build brand loyalty
6 million orders and
transactions per month
OMNICHANNEL
INTEGRATED
SELLING –
many channels for
customers to shop
and engage with the
products
STARBUCKS
Mobile Order & Reward App
Source: Spire’s Secondary and Primary Research

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FLEXIBILITY –
with the collaboration
with other parties,
will increase the
customer experience
Order books in
Rakuten website
Pick Up at Lawson
Stores (11,922
stores in 2016)
INTELLIGENT LOCKER - It will give an option to the
customers to pickup their order directly from the lockers
at their convenient time, using a barcode scanner or a unique
key sent by the company (integrated payment system). This service
also offers security and prevent from missing delivery for
the customers.
CHOOSE YOUR STORE – Customer are able to choose
the most convenient place and time for them to pick up their
orders, with free shipping. This gives flexibility for customer.
Source: Spire’s Secondary and Primary Research, Hubspot
Technology Collaboration
OMNICHANNEL

10. 10
SHOP WITH
PURPOSE
BRAND VALUES - Customers are caring to
buy things that connect with their social
values. It becomes one of purposes from
customers to shop a product, such as fair trade
and other sustainable (green) products.
66% global consumers
care to buy
sustainable products
Source: Spire’s Secondary and Primary Research, Statista
-
5.00
10.00
15.00
2014 2015 2016 2017 2018 2019 2020
Revenue of Fairtrade of International Product
(Billion Euro)
Fairtrade International Product
Sustainable & Eco-Friendly Products

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TEXTILE CARE – the increasing number of urban
population, has create a demand for a quick and
decent quality for laundry services.
81%
80%
74%
69%
54%
49%
41%
0% 20% 40% 60% 80% 100%
Northern America
Oceania
Africa
DEGREE OF URBANIZATION IN
2017 (% OF TOTAL
POPULATION)
IDN
(51%)
PHL
(43%)
IND
(53%)
CHN
(57%)
Use of Washing Machine
Global average (69%)
Source: Spire’s Secondary and Primary Research, World Bank, Statista, Nielsen
59%
87%
46%
74%
82%
27%
3%
11%
15%
4%
5%
3%
28%
4%
8%
9%
5%
14%
7%
6%
Asia Pacific
Europe
Africa/Mid.East
Latin America
North America
Laundry Methods (2016)
Washer & Dryer Handwash Coin Laundry Laundry Service
Laundry Service

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The increase of female
participation at work, has created a
demand for childcare. This service will
give benefit for the women to
pursue their career life and
provide their kids with good
quality of education.
54.3% of Mothers
are working
(2017- Global
Average)
48.31
48.00
48.07
48.09
44.60
44.94
44.96
44.97
43.87
43.82
43.76
43.65
42.60
42.81
43.12
43.22
37.63
37.76
37.99
38.07
37.55
37.09
38.21
38.24
24.38
24.52
24.69
24.54
2014 2015 2016 2017
FEMALE (% OF TOTAL LABOR FORCE)
Vietnam Singapore China Japan Malaysia Indonesia India
Source: Spire’s Secondary and Primary Research, World Development Indicator, StatisticBrain
Childcare
73.03 76.10 80.72 85.61 90.80
18.67 18.16 18.61 19.07 19.54
27.32 29.87 30.75 31.65 32.57
2013 2014 2015 2016 2017
East Asia & Pacific South Asia Middle East/Africa
Enrollment Rate in Preschool
(% Total Population of the age group)

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New Frontier
Attractive
Stable
Hot Country
1st
Indonesia
1st
Philippines
3rd
Vietnam
4th
India
5th
Myanmar
6th
China
7th
Malaysia
8th
Cambodia
9th
Singapore
10th
Brunei Darussalam
COUNTRY

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HOT COUNTRY #1: INDONESIA

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Market Potential & Trend – Food & Beverages
INDONESIA
11% of Indonesian say they
eat away from home once a
day (Global rate – 9%)
44% of Indonesian
favor on street food or
casual dining
In 2017, Food &
Beverage Industry
contributes 34.9%
to GDP with growth
9.4% from
previous year
WARUNK
UPNORMAL
Source: Spire’s Secondary and Primary Research, World Bank, Nielsen, Indonesia Statistics Bureau

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Market Potential & Trend – Retail
INDONESIA
Indonesia has the highest retail sales in ASEAN region: USD
350 billion (Global Retail Development Index 2017)
In 2017, there are 12,000 stores (400 stores in Manila)
In 2017, there are 14,000 stores in Indonesia
In 2016, retail industry has contribute
15.24% of GDP
63% of Indonesian consumer are willing
to buy “green products”
Modern Retail Store
2007
11,927
2015
36,000
3
FOL
D
Source: Spire’s Secondary and Primary Research, Statista, KataData

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HOT COUNTRY #1: PHILIPPINES

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Market Potential – Food & Beverages
PHILIPPINES
Filipino dine out of
home 42x in a month
TOP 3: Where do the Filipino Eat?
Quick-service
restaurants
Doughnut
Shops
Convenience
Store
Meals & Snacks Eaten
Out-of-Home
Lunch 30%
Dinner 13%
Mid-Night Snack 3%
Mid-Morning Snack 5%
Breakfast 16%
Mid-Afternoon Snack 33%
Source: Spire’s Secondary and Primary Research, Nielsen, Philippines Statistics Authority
33%
22%
19%
19%
7%
Percentage of F&B Sector
Establishment (2015)
Restaurants
Fast Food Chains
Refereshment Stands
Cafetarias
Bars and Cocktail Lounge
6,652
4,447
3,772
3,748
1,445

20. 20
Market Potential – Pre-School
PHILIPPINES
Female
Participation :
39.9% of total
labor force
GDP Per Sector
Service 59.8%
Agriculture 9.4%
Industry 30.8%
Urban Population Growth
(2016-2020) : 1.21% (CAGR)
Source: Spire’s Secondary and Primary Research, World Bank, Statista
36.51 40.45
80.31
0
50
100
2008 2009 2015
Net Enrollment Rate
Pre-Primary Education (%)
48,000
pre-school in 2012
In 2016, education service
grew 7.5%

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HOT COUNTRY #3: VIETNAM

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Market Potential – Retail and Food & Beverages
VIETNAM
40%
15%
15%
6%
8%
13%
3%
Beverage Food Milkbase
Homecare Personal Care Cigarette
Baby Care
What do they buy?
“In-Store
Shopping”
F&B Revenue
in 2018 :
growth 10.9%
up to 2019
92% of Vietnam shoppers
enjoy doing the grocery
household shopping
67% of total expense go to
fresh & healthy products
Where do the
Vietnamese go for shopping?
Grocery:
8 times/month
Convenience Store:
3 times/month
1
2
3
Wet Market :
22 times /month
Source: Spire’s Secondary and Primary Research, PwC, Vietnam Retail Report, Nielsen

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Market Potential – Preschool
VIETNAM
81.4
83.1
85.6
88.1
2014 2015 2016 2017
ENROLLMENT RATE PRE-SCHOOL (%)
13,548
14,863
2013 2016
NUMBER OF PRE-SCHOOL
Female Participation :
48% of total labor
force
Source: Spire’s Secondary and Primary Research, UNESCO, World Development Indicator

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NEW FRONTIER #4: INDIA

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Market Potential – Food & Beverages
INDIA
Restaurants
Place to eat and socialize!
The Reasons for
Eating Out:
Premium
Quality & Comfort 24%
To Socialize 15%
Experimental 25%
Family 36%
What do Indians Eat?
Age of Group Profile of Those Who Eat Out
21-30 Years
40%18-20 Years
18%
31-40 Years
31%
Above 40 Years
11%
North Indian
28%
Asian
19%
South Indian
9%
American
7%
Pizza (Italian)
6.2%
Source: Spire’s Secondary and Primary Research, Statista, UNESCO, World Development Indicator

26. 26
Market Potential – Laundry Service
INDIA
On Demand Laundry!
98% of the laundry services are informal.
Growth Rate
(2016-2020): 2.43%
767,000 Laundry
Service Establishment
Source: Spire’s Secondary and Primary Research, World Development Indicator

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NEW FRONTIER #5: MYANMAR

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Market Potential – Food & Beverages
MYANMAR
TASTE, QUALITY, AND
BRAND
Status Symbol for the
youngster!
Up to 12 stores
(est.2015)
2 stores
The Rise of Foreign Brands
‘Word of Mouth’ is important marketing for F&B
market (34% of respondent)
Consumer counts on
grocery stores (93%)
“FRESH PRODUCT”
> 30% household consumption
Source: Spire’s Secondary and Primary Research, Oxford Business Group

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Market Attractiveness – Based on
COUNTRY FOOD & BEVERAGES RETAIL
LAUNDRY
SERVICES
PRE-SCHOOL
HotCountry
Indonesia (1st)
Philippines(1st)
Vietnam (3rd)
New
Frontier
India (4th)
Myanmar (5th)
Attractive
China (6th)
Malaysia (7th)
Cambodia (8th)
Stable
Singapore (9th)
Brunei (10th)

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Tel: (62-21) 5794 5800
Fax: (62-21 5794 5808
Wisma 46 Kota BNI, 25th Floor
Jalan Sudirman Kav. 1, Jakarta 10220
INDONESIA
indonesia.info@spireresearch.com
www.spireresearch.com
Tel: (603) 2161 6088
Fax: (603) 2162 6088
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