Cosmetics to Myanmar

Trends and opportunities

The market

Myanmar’s cosmetics market has good long term growth potential for Australian companies as the country transitions to an open market-driven economy following years of military rule. These include an increased awareness of skincare solutions for health and beauty, a small but growing middle class, increased exposure to Western trends, the lowering of tariffs and a large population of 53 million. The beauty and personal care sector is anticipated to have a combined annual growth rate of 17 per cent from 2013 to 2018 (Source: Euromonitor International, Markets of the Future: Myanmar 19 May 2015).

Skin care is extremely important to Myanmar women as shown by the widespread use of Thanaka (a traditional Burmese face paste). Thanaka is a yellowish-white paste made from ground bark and has been used for skin cooling, sunburn protection but also as a beauty highlight. As trends in the country continue to evolve due to the increasing number of international tourists, rising middle-class consumer incomes and expatriates, local customers are searching for new high quality products.

From 2014 - 2017, the number of shopping centers, cosmetic retail chain stores, beauty parlors, spas and beauty shows in Myanmar significantly increased and a large variety of international cosmetic brands can now found on shelves in shopping malls. Myanmar’s consumers are becoming more conscious of quality products and demanding premium personal care products as the market develops. Additionally, the real value of private final consumption in Myanmar rose by 4.8 per cent in 2016 and growth of 3.9 per cent is expected in 2017. This trend is set to continue as Myanmar’s gross domestic product (GDP) growth is forecast to be over seven per cent in 2017 which is expected to be maintained for a number of years thereafter (Source: Euromonitor International, Myanmar: Country Profile, May 2017).

People are becoming more conscious of both protecting their skin and highlighting their features and there is a high degree of trust for most international brands due to the influence of exposure to Western lifestyles and Korea dramas in the media. Some customers buy products from authorised distributors, some buy from a reputable cosmetics counter or store and some buy from online cosmetic sales which are believed to be safe compared to three or four years ago. Buying decisions are made by consumers according to their trusted network. Most consumers are not loyal to one product, they want to try out new products depending on trends (Source: Beauty Connect Asia, Southeast Asia remains a market of contrasts, 13 January 2017).

Opportunities

  • Leverage the increasing numbers of beauty bloggers promoting and educating younger generation about the importance of skincare routines, sunscreen and make up trends by sharing product reviews and make up tutorials on their blogs and social media.
  • Join the increasing number of Western cosmetic brands entering the market who are introducing a range of new marketing methods to promote brand awareness and loyalty.
  • Capture a share of the youth/young adult market who are using cosmetic and skincare products on their face rather than using traditional Thanaka.
  • Consider setting up manufacturing as local distributors, cosmetic associations and the Myanmar Government are welcoming increased foreign investment.

Competitive environment

  • Local OEM cosmetic manufactures have a good market share with brands such as SAI and Bella which are sold in major department and smaller individual stores spread throughout Yangon and smaller cities.
  • The lower end of the market is dominated by very affordable brands from the region.
  • Grey channel imports are still widely available in the market in particular at the low end and sold through markets and small shops.
  • There are a small number of international brands operating stores in malls as well as areas within duty free stores and premium supermarkets.
  • The online consumer market is still new as most people want to visit a shopfront before making a purchase decision and electronic payment processes are not well developed.
  • European and United States (US) brands are highly regarded and trusted.
  • Korean products are number one in the market due to TV shows.

Tariffs, regulations and customs

Myanmar is a member of the ASEAN Australia New Zealand Free Trade Area (AANZFTA). Reflecting its lower level of economic development, Myanmar’s commitments to reduce tariffs under AANZFTA are being phased in at a slower rate than other parties to the agreement. Tariffs will start to fall on most items either in 2015 or 2020. Visit the DFAT Free Trade Agreement Portal for tariffs on specific products.Marketing your products and services

Import procedures

A local company requires export import license and company registration to import/export products in and out of country. The company or person responsible for placing the cosmetic products in the market, shall notify the Department of Health, FDA. An application with completed documentation must be submitted in person by an authorised representative or owner of cosmetic products. Updating changes to notified cosmetic products shall be made only with the approval of Food and Drug Administration (FDA).

Type of documents required for notification of cosmetic products include:

For importer/distributor

  • a copy of authorisation letter from manufacturer
  • a copy of business license of the local company or certificate of incorporation
  • acknowledgement of cosmetic notification from the country of origin
  • full ingredient listing and the percentage of restricted ingredients
  • complete original label one set.

For manufacturers

  • a copy of business license of the manufacturer
  • a copy of private industrial registration certificate
  • a photocopy of cosmetic manufacturing license
  • full ingredient listing and the percentage of restricted ingredients
  • complete original label one set.

Imports into Myanmar are controlled by the Customs Department of the Ministry of Finance. Customs is responsible for assessing and collecting applicable customs duties and taxes on imports and carrying out other regulatory and law enforcement responsibilities relating to imports.

The importers need customs declaration and required accompanying documents for custom clearance:

  1. import license
  2. invoice
  3. bill of landing, air consignment note or truck note
  4. packing list
  5. other certificates, permits or import recommendation as required (e.g. country of origin or SPS or FDA certificate).

Labelling requirements of cosmetic products

The following information should appear on the outer packaging of cosmetic products or where there is no outer packaging, on the immediate packaging of cosmetic products.

  1. the name of the cosmetics products and its function
  2. instructions on the use of the cosmetic products
  3. full ingredient listing with percentages of restricted ingredients
  4. country of manufacture
  5. the name and address of the company
  6. contents given by weight or volume, in either metric or both in metric and imperial system
  7. manufacturer’s batch number
  8. manufacturing date or expiry date of the product
  9. special precautions to be observed in use.

All information listed above should be written in English and/or local language so it’s understood by the consumer where the product is marketed.

Marketing your products and services

Market entry

Local authorised distributors with specialist industry knowledge and established networks are generally the best way for Australian exporters as they are well acquainted with import procedures and documentation. They help to build market contacts, navigate regulatory and procurement processes and identify emerging opportunities.

Australian exporters wishing to enter the Myanmar market should plan a preliminary visit to meet potential agents, distributors, customers and relevant government agencies. Once a relationship with an agent or importer is established, regular visits should be made two to three times a year to maintain relationships and develop new leads.

Australian exporters can also participate in the increasingly popular cosmetic, beauty trade shows which provide effective exposure for your company and products to importers and their customers.

Marketing

Distributors are using specific ways to advertise and promote branding in Myanmar, sponsoring products for bloggers to use in their reviews, using local celebrities and artists to advertise, providing cosmetic educating sessions to local makeup artists and bloggers, offering sales and promotions.

Distribution channels

Distribution networks in Myanmar are fragmented and unreliable. This is changing with the entry of international general and specialised logistics services. Yangon is the major distribution centre for goods imported by sea and air. Mandalay is the distribution hub for upper Myanmar, especially for goods imported by land from China and Thailand.

Austrade Yangon is able to help identify potential local partners for interested Australian companies.

Transport

Most imported products arrive by sea through Yangon port, Myanmar’s busiest port. Road transport overland from neighboring countries, particularly China and Thailand, is possible but the road systems are generally poor and road freight rates can be very high.

There are a growing number of direct air links with key Asian cities, and these provide a channel for air freight for perishable items. Air freight routes from Australia are typically through Singapore, Kuala Lumpur or Bangkok airports.

Links and industry contacts

Customs Department
DFAT Free Trade Agreement Portal
Food and Drug Administration (Myanmar)
Ministry of Commerce
Myanmar Cosmetic Association
Myanmar National Trade Portal
Union of Myanmar Federation of Chambers of Commerce and Industry

Please note: This list of websites and resources is not definitive. Inclusion in this list does not imply endorsement by Austrade. The information provided is a guide only. The content is for information and carries no warranty; as such, the addressee must exercise their own discretion in its use. Australia’s anti-bribery laws apply overseas and Austrade will not provide business related services to any party who breaches the law and will report credible evidence of any breach. For further information, please see foreign bribery information and awareness pack.

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