Workshop on Export Opportunities of

Mauritian Products in Madagascar (Antananarivo, Antsirabe, Mahajanga,

Toamasina)

11th December 2013

Agenda

1. Research Objective and Methodology

2. Overview of Madagascar

3. Doing Business in Madagascar

4. Logistics

5. Survey Findings & Market Strategies

1. Research Objective and

Methodology

Research Objective

• To conduct a focused market survey

• Four cities targeted: Antananarivo, Mahajanga, Antsirabe & Toamasina

• Aim: to strengthen our market share in Madagascar

• By assessing how to increase exports of existing and potential

Mauritian products to Madagascar

Research Methodology

Phase 1: Preliminary Desk Research Match supply capabilities with import behaviour of Madagascar

Short list potential products

Appoint Consultant for data collecting and processing

Phase 2: Fieldwork Collection of sample (23 products used)

Survey of 229 wholesalers and retailers (8 weeks)

Face to face interviews 15 – 27 April 2013 Importers (in Antananarivo, Antsirabe, Toamasina & Mahanjanga)

Chamber of Commerce and Industry (Antsirabe, Toamasina & Mahajanga)

Malagasy Customs

Mystery shopping

Phase 3: Reporting and Disseminating Main Findings Data analysis and report writing

Workshop

Report on Website, in EM’s Knowledge Centre

List of Samples Product Category Targeted Products

Textile & Apparel • Men’s shirts • Women blouses

• Denim Fabrics • Cotton Yarn

Agro & Agri • Sweet Biscuits • Rum & Wine • Tea • Spices • Banana Chips

• Fertilisers • Frozen Semen • Seeds • Animal Feed

Paper & Printing • Paper labels • Books, Brochures &

Leaflets

• Envelopes • Stationery • Sanitary Paper

Light Engineering • Tubes and pipes – PVC & Iron

• Aluminum structures

• PVC Openings • Plastic Products

Chemicals • Cosmetics • Soap/detergents

• Perfumes & Deodorants

Paints • Paints • Varnishes

Furniture • Home and Office Furniture

Fieldwork

2 missions in the 4 cities studied :

Surveys with distributors (wholesalers and retailers) for each product or product category

Meetings with importers with Enterprise Mauritius officers

Objectives : to know Malagasy market : actors, external environment and different marketing components

Antananarivo Toamasina Antsirabe Mahajanga Total

Surveys 100 49 34 46 229

Interviews 25 25

Appointments with EM 14 18 11 8 51

2. Overview of Madagascar

Update political agenda

2006 : re-election of President Marc Ravalomanana for a 5 year term

March 2009 : Pdt Ravalomanana was ousted to exile in RSA after a putsch that was led by M. Andry Rajoelina, Antananarivo mayor, with military support

Sept 2011 : signature of a political roadmap, under the supervision of the International Community, recognizing M. Rajoelina as Transition President and appointing M. Omer Beriziky as Prime Minister

Dec 2012 : M. Ravalomanana agrees to withdraw from presidential elections

Jan 2013 : M. Rajoelina agrees to withdraw from presidential elections

Presidential elections were scheduled to July 24 2013, but postponed to October 25 by the CENIT (election independant commission)

Oct 25th 2013, 1st round presidential election : Dr Robinson Jean Louis (21.12%), supported by M. Ravalomanana,and M. Rajaonarimampianina Hery (15.92%), former Finance Minister, supported by M. Rajoelina, for 2nd round

Dec 20th 2013, 2nd round presidential election, combined with MP elections. Result to be available by end January 2014, and MP results by mid February

Handover scheduled for end February 2014

Remaining issues for the future The new Prime Minister will be appointed according to the majority of elected MP

Only 5 political parties covers all MP circonsciptions for elections.

Elections will not solve governance issues and National reconciliation implies that M. Ravalomanana returns from exile

The 2010 referendum validating a new Constitution hasn’t been recognized by all political stakeholders and the International Community

International development aid agreements will have to be renegotiated when Madagascar is now the poorest country of the world (92% of the population living with less that USD 2 per day)

Public expenses : Treasure Dpt has declared that State is close from bankrupcy, some public companies have to be subsidized (JIRAMA - power and water supply, Air Madagascar) & tax resources are scarce, etc.

Current exchange rate doesn’t represent the market situation (preferential rate for oil importers), and according to IMF, depreciation of the MGA (Ariary) will be between 15 and 25%.

2014 : probable increase of inflation rate and Consumer Price Index, decrease of rice production

LW-12/05 11

Economic Background

Key figures 2012 (2011) : Growth rate = 3,1% (1,9%), estimation for 2013 is 3.3%

Inflation rate = 6,4% (9,8%)

GDP per capita = USD 447 (427)

(source : World Bank)

Main economic drive: Mining: ilménite (QMM - Rio Tinto in Fort-Dauphin), nickel (Ambatovy in Moramanga - Toamasina). 80% of FDI from 2006 to 2009.

Industry: sugar, textile (EPZ)

Agriculture : rice, clove, shrimp farming, litchi, etc.

Services: tourism & transport

Very limited public investment since 2009

Index ranking in 2013 : IFC Doing Business : 144/183, - 7

WEF Economic Competitiveness : 132/148, - 3

UNDP Human Development Index : 151/187, no change

Population : 22.300.000 (Source : World Bank)

Urban population 33%, rural population 67%

Poverty rate (less than USD 2 a day): 92%

LW-12/05 12

Trade balance

Main exports in value : textile (44%), shrimps (7%), vanilla (4%), clove

Main imports : machinery and equipment (14,4%), steel and steel work (7,2%), textile (6%)

Main supplier countries : UAE (oil products), France (EPA), China (TDPS), South Africa (SADC), Mauritius (IOC, SADC, COMESA) and India (IOR)

2006 2007 2008 2009 2010 2011

Exports FOB (millions USD) 962,6 509,8 986,3 809,9 766,3 791,0

Imports CAF (millions USD) 1 761,4 2 564,8 3 997,4 3 197,5 2 525,2 2 827,2

Trade balance -798,8 -2 055 -3 011,1 -2 387,6 -1 758,9 -2 036,2

LW-12/05 13

Trade barriers (surveyed products)

Import tax : 0% : HS 9018 syringe, HS 3926.9020 waterer and feeder (livestock), HS 3923 cellulose bags, HS 5204.1110/1120/1140, HS 5204.20 : yarn, and HS 5204.1910/40 : yarn

5% : HS 3926.9010 plastics articles, HS 3923 baby’s bottle, HS 1101 flour, HS 5204.1130 yarn, HS 5204.1920/30 yarn, HS 4801.40 paper for newspaper, HS 3210.00 varnish

10% : HS 3923, box, bottle, HS 482110 labels, HS 4819 paper bag

20% for all other product

VAT: 20%, except for the following product (exempted) HS 4801.40 paper for newspaper

Excise duties, only for : HS 2203, 2208 : wine, rum, drink spirits pulling alcohol at 230%

HS 2208.3090 : whiskies at 250%

Total exemption (all 3 taxes) for the following products : HS 3926.9010 : loops for animal identification,

HS 3105.20 : mineral or chemical fertilizers containing nitrogen, phosphorus and potassium

HS 0909 : seeds and nuts

HS 2309.90 : other preparation for animal feed

LW-12/05 14

Non Tariff Barriers

(surveyed products)

• Required certificates and authorizations – « Certificat de consommabilité » by Trade Ministry : sweet

biscuits, banana chips, rum and wine,

– Custom clearance authorization delivered by Home Affairs Ministry : brochures and books,

– Import authorization : • Ministry of Livestock : animal feed,

• Ministry of Health : cosmetics and perfume,

• Ministry of Agriculture : fertilizers, frozen semen, seeds and soap products.

• National standards – Mandatory labeling for pre-packaged food products (cf.

Bureau des Normes Malgaches, cf. decree n°1076/2012 of Trade Ministry)

– Other international standards are optional

LW-12/05 15

Preferential Trade

Agreements (PTA)

• IOC (1984) : custom duties exemption for all products, but certificate of origin required

• SADC (2005) : customs duties exemption if : – Wholly produced in a member State

– Products that was produced or processed in a member State

• COMESA (1994) : customs duties exempted for all products, but required certificate of origin

• IOR-ARC (1997) : decrease of some tariff barriers

• Tarif Douanier Préférentiel Spécial (TDPS) with China, for any wholly manufactured product in the country, or has undergone a significant transformation

• AGOA (2001 - 2010) : quota free exemption for VAT, custom duties and all import taxes, simplified export procedure

LW-12/05 16

Madagascar imports 21% of products from the European Union.

Tariff cut from 2014 to 2022.

Category 2014-2016 2017 2018-2019 2020-2021 2022

Primary goods 0%

Semi finished products See below 5% 5% 3% 0%

Finished products 20% 15% 10% 5% 0%

Category National rate Import from

UE

EPA tariff

2014 2015 2016

Semi finished goods

(Cat 2)

10% = 0 € 8% 8% 8%

10% > 0 € 10% 10% 8%

20% = 0 € 8% 8% 8%

20% > 0 € 20% 8% 8%

Intermediate Economic Partnership

Agreement (EU)

3. Doing Business in Madagascar

Doing Business in Madagascar

Business culture

Placement of initial orders may take some time as this requires some

investment in terms of building relationship

Mauritian companies therefore advised to be patient

Methods of payment

Businesses used to pay for goods after delivery and being granted 30 to 60

days of credit

Importers prefer to work on L/C basis with credit terms of 30 to 60 days

Recommended to conduct a KYC before trading with importer

Doing Business in Madagascar

(Contd)

Language

French commonly used in meetings as well in business communication

though English is also widely understood

3 mobile operators: Airtel, Orange, Telma

Roaming connections are available with both Orange and Emtel

Local Prepaid sim cards cost 1,500 AR (MUR 23) while scratch cards are

available in denominations of 4000 AR, 5000 AR and 10,000 AR

A local SMS is around AR 72 (MUR 1.09) and a three-minute local call is

around 1980 AR (MUR 30)

4 Internet Service Providers : Telma (Moov), Blueline, Orange, Airtel

4. Logistics

Logistics (1/2)

Sea Freight

Frequency of shipments: twice weekly

Transit Time: 2 days

Port Carrier Container Freight BAF/CSF/

Seal

Local Charges Total Costs

Tamatave PIL 20 ft 400 USD 13 USD Rs 10,563.51 Rs 24,345.86

40 ft 725 USD 13 USD Rs 17,537.01 Rs 39,975.76

Majunga MSC 20 ft 800 USD 95 USD Rs 11,424.24 Rs 39,124.49

40 ft 1525 USD 175 USD Rs 17,258.46 Rs 69,873.46

Logistics(2/2)

Air Freight

Cargo service from Mauritius to Antananarivo assured by Air Mauritius

Surcharge Applicable:

- Fuel Surcharge: MUR 23.00/K

- Security Surcharge: MUR 1.50/K

100 k = (33.40*100)+(23*100)+(1.50*100) = Rs 5,790

Flight Schedule

Airlines Itinerary Frequency No. of

flights

Air Mauritius Mauritius -

Antananarivo

Tuesday, Wednesday, Thursday

and Sunday

1

Surveyed cities

Antananarivo (2,2 million inhabitants) :

10% of population,

Concentration of firms and activities

Main activities: rice, poultry and fish farming, beekeeping, tourism, handicraft & industry (EPZ, food, chemical, etc.)

Toamasina (480.000 inhabitants) :

First harbour in terms of activity,

Main activities : mining (Ambatovy), cash crops (sugar cane, coffee, clove, pepper), fruit production and trade (litchi, pineapple, banana)

Mahajanga (283.000 inhabitants) :

3rd port,

Main activities : tourism, agriculture (rice, cassava, maize), fishing (Somapêche, Réfrigépêche Ouest) & shrimp farming

Antsirabe (611.000 inhabitants) :

2nd industrial city (Cotona, Fifamanor, Holcim, Brasseries STAR, Socolait, Tiko until 2009)

Main activities : agriculture (potatoes, rice, maize, soybeans and peanuts, fruits and vegetables), tourism

Malagasy Market Facts

Household expenses : 35% for food, 17% for house rent in urban areas

Major buying offices : Sogerep, Soredim, Ucodis, Comadis, Netter, NRJ Group, Sanifer, Smtp Group, Batpro

Main super and hypermarkets: Leader Price, Shoprite, Jumbo Score, Horizon (Chinese products), Point Pacom, Mr Bricolage, Courts, Batimax.

Distribution network:

Importer or buying offices or local producers National wholesaler Local wholesaler Retailer : supermarkets & grocery stores

Main importers

(Surveyed Products)

NRJ GROUP : stationery, office furniture, cosmetics (Sodim),

Taloumis Group :

Soredim : representation and distribution of food brands, rum and wine

TAF Fihavanana : food, agrobusiness, Import-export

Sofitrans duty free shops: rum & wine, cosmetics

UCODIS : import & export

Batpro : import and sale of construction equipment, civil engineering

SMTP Group: building public works, import and sale

Comadis, Royal Spirits: rum & wine

SMOI : construction material, equipment, tools, retailing

Main conclusions Slow down of economic growth since 2009

Poverty rate has increased: + 10 % since the crisis

Economy based on mining, trade & services (tertiary sector) and agriculture

Slowdown in trade in 2011 (-30% compared to 2008)

Some big companies / organizations are direct importers : Aqualma (shrump farm), Ambatovy, QMM, Toamasina Port, FNUAP, textile EPZ

Limited number of big importers

Main importers are located in Antananarivo, even if they have branches in other cities

The distribution network is long and complicated (confirmed by the survey).

High Potential Products (6)

Banana chips : fairly new product

Animal feed,

Seeds,

Fertilisers

Perfume and deodorants

Paints and varnished lacquers

Product A2: Banana chips

HS Code 2008

Market presentation • Mauritian product : high price for local market, different packaging

• Very few local producers (focused on peanuts, potato chips & « croquettes » – « caca pigeons »)

• Occasional demand

Market analysis • Market is still open

• No reference brand on the market

• However there is a potential niche market

Market approach • Highlight a range of good quality products for high income households

(see Mauritian product sample in a nice packaging)

• Product launch through an important advertising (tasting in trendy bars and restaurants ...) to stimulate the word to mouth effect.

Product B6: Animal feed

HS Code 2309

Market presentation • Mauritian product : slightly higher price • Many little breeding farmers who produce their own animal

feed • Existence of few local producers of animal feed (LFL

Madagascar, Agrivet)

Market analysis • Agrivet is one of the two main producers, with a good national

distribution network • Very strong market share of LFL • Increasing demand due to the expansion of existing producers

Market approach • Improve maurician product competitiveness • Target the market for dietary supplements or raw material, as

maize, wheat, soya. • Find a partnership with the parent company or Agrivet (SMTP

Group, Danil Ismail in terms of distribution)

Product B7: Seeds

HS Code 1209.91

Market presentation • Good price of Mauritian product

• B2B : especially in Antananarivo and Antsirabe, 2 agricultural regions

• Supply : important local production (SFL, Seeds Producers Association)

• Strong presence of South African seeds (imported by Agrivet)

Market analysis • Vegetable seed market stagnating

• Increasing demand and innovative supply for different varieties (vegetables)

Market approach • Offer a more competitive price / quality ratio

• B2C market : farmers to be prospected

• Partnership with farmer associations (UPFL – Union des Producteurs des Fruits et Légumes, FIFATA, CTHT)

Product B8: Fertilizers

HS Code 3105.20

Market presentation • Mauritian product : no information about packaging and pricing

• Main market in rural areas

• Important use of natural fertilizer (manure)

• Local producers, Guanomad (organic product), Agrivet, and SEPCM control the distribution chain locking the wholesalers through an exclusive partnership

Market analysis • Strong growth of the fertilizer market

• Limited financial means of local farmers

• Strong awareness campain for the use of fertilizers conducted by suppliers in partnership with retailers.

Market approach • Consider partnering with local distributors, guaranteeing a competitive price /

performance ratio and distribution network

• Use existing network of grocery store in rural areas to reach the farmers.

Note: The animal and vegetable fertilizers (HS 3101), the mineral and chemical fertilizers (HS 3102-05) are exempted from customs duties and VAT under certain conditions.

Product C10: Perfumes & deodorants

HS Code 3303

Market presentation • Imported products from Europe (Fa, Nivea, Ushuaïa, Rexona,

O.E etc.), South Africa (Blue Ice) and India (Dove).

• Mauritian products already present on the market with very competitive prices (Déo)

Market analysis • Important competition despite a limited number of importers

(Sodim, Netter Madagascar, Goldenrama)

• Potential market in province cities: Tamatave, Majunga

• Consumer behaviour : brand knowledge, price, packaging

• Target market: middle incom household and up

Market approach • Partner with a local distributor for further development in

provinces (out of Antananarivo)

• Shayna Cosmetics interested in importing Mauritian product

• Aggressive and well targeted advertising campaign

Product H29: Based paints varnish

(HS Code 3210) &

others paints, lacquers (HS Code 3209)

Market presentation • Various brands from Madagascar (Somalaval, Aurlac), India,

Egypt (Kapsi) and Europe (Zolpan, PPG), Mauritius

• Competitive price of Mauritian products but new to the market

Market analysis • High competition with strong and well-established players in the

local commercial network as Zolpal, Somalaval, Aurlac

• Focus on B2B (construction companies and business association), and high-income households

Market approach • Find a leading importer in the market, with a strong reputation

and a distribution network (Sanifer, Point Pacom)

• Position on the high end market and communicate on products

Products with possible

potential market (11)

Spices (typical Mauritian product only)

Cosmetics

Soap and detergents

Paper labels

Envelopes

Men’s shirt

Women’s underwear

Various plastic articles

Hollow tubes of cast iron, iron or steel

Tubes and pipes

Home and office furniture

Product A3: Spices HS Code 0910

Market presentation • Mauritian product : high price for pepper and curry powder • High tariff barriers: both IT & VAT at 20% • Important local production and export of high quality spices • Common Malagasy people don’t eat spices (only chili)

Market analysis • Well established players (TAF, Salone) with solid and powerful

distribution network of local retailers • Traditional retailers are not interested in referencing new spice

product

Market approach • Target high income household and expatriate niche market with

typical Mauritian products : masala, cardamon, biryani, vindaye, ...) • B2B approach with specialized grocery stores (Aliment Import for

Asian food) and restaurants

Product C9: Cosmetics

HS Code 3304.99 (body lotion, massage oil, essential oil, hair care)

Market presentation • Mauritian product in middle range

• Supply: both local (Homéopharma, Bio Aroma, and specific hotel brands) and imported from France (L’Oréal group), South Africa (Vaseline) and India (Dove)

Market analysis • Highly competing and diversified market

• Each range of products has its own market

• Growing demand for middle income customers (hair and body care)

• Market in stagnation for essential oil (middle income and up, and hotels)

Market approach • Provide a competitive quality / price ratio

• Have a well targeted promotion campaign (notoriety & free samples)

Product D11: Soap & detergents

HS Code 3401 (liquid & powder washing soap, laundry soap)

Market presentation • Mauritian product : competitive and well known on the market • Main product are from Europe (Palmolive, Dove, Leader Price,

Casino etc.), Turkey (Citron), Africa (Zakuro) and Australia (Dalan)

Market analysis • High notoriety of local products (Savonnerie Tropicale) for the mass

market (Nosy soap) • Limited market for toilet soap (middle and high income households) • Growing market for bar soaps (Citron Plus) and small packaged

detergents and powder soap

Market approach • B2B approach with industrial cleaning companies and hotels &

restaurants. • Consider small pieces packaging for mass market and through

traditional distribution channel

Product E13: Paper labels

HS Code 4821.10

Market presentation •Mauritian products: very large range of product •Local leaders on the market (Madprint, Graphoprint, MYE) have powerfull equipment to meet market requirements •Existing Mauritian player (Mauriflex) in Madagascar

Market analysis •Growing market despite the crisis •Dominated by 2 leaders: Graphoprint and Madprint, which comply with quality standards

Market approach •Favor a B2B approach (manufacturing firms)

Product E14: Envelopes

HS Code 4817

Market presentation • Mauritian product is competitive (price and quality)

• Supply is limited to white plane envelop that can be personalized by printing companies

• Traditionnal use of envelops : funerals, weddings, birth, ceremonies etc.

Market analysis • Priority target: stationnery retail • Local production: cheap and low quality (Imprimerie de Madagascar) • Local Producer: Main importer : NRJ GROUP

Market approach • Working with NRJ GROUP and Karim Ji for tailor made envelopes

• Innovate with specifics envelops for ceremonies

Product G20: Men’s shirt

HS Code 6205

Market presentation • Various brands from China, Thailand, Mauritius, directly imported

by retailers

• Importance of counterfeiting products

• Limited clothing budget of consumers.

Market analysis • Domination of Chinese products, mainly on the low and middle-

range (average unit price USD 6.86)

• Target market: middle and high income individuals

Market approach • For mass market, competitive prices compared to Chinese

products

• Develop a strong brand identity

• Target the high-end market if the quality is good enough

Product G22: Women’s underwear

HS Code 6108

Market presentation • Mauritian product : higher price than existing supply

• Various brands imported from France (Diego Reiga, Sinequanone, City etc.) and China (Huan Fo, D&G, Gucci etc.)

• Preference for Chinese brands that offer different and affordable quality for each category of consumer

Market analysis • Existing market is limited to high-end customers but growing

demand for middle range income

Market approach • Propose a partnership with a distributor (supermarkets, ready-to-

wear shop) • Promotion campaign for the new brand • Approach target market through private sales

Product F17: Various plastic articles

(glass and plastic box)

HS Code 3926.90

Market presentation • Existing supply : mix of well known brand, and brandless

products

• Imports from France (Top budget, Casino, Leader Price), South Africa (Nu-Wave), and China (brandless) by buying offices (Taloumis group)

• Importers are difficult to identify (informal channel)

• More and more Malagasy eat outside home (lunch)

Market analysis • Growing demand on middle income household market

• Increasing demand is concerning Chinese product, cheaper than French or South African models.

Market approach • Work with formal buying offices

• Focus on B2B market : restaurants, take away, and catering services

Product H26: Hollow tubes

of cast iron (HS Code 7303)

or iron and steel (HS Code 7306)

Market presentation • Generic products, without brand identification • Importers and wholesalers are mainly building material

specialists as Sanifer, ABC Construction or Edelec Group • Import from Turkey

Market analysis • Market is open • Increasing demand • Price is the main business criteria

Market approach • Highlight a B2B campaign targeting construction companies

Product H25: Tubes and pipes

HS Code 3917

Market presentation • Maurician product : wide range of product

• Generic products, without identification.

• Major local producers : SMTP, Comeplast, Plascom

• Major importers : Sanifer, Métaplasco

• Large informal market: recycling and second hand market

Market analysis • Increasing market due to growth of construction industry

Market approach • Propose partnerships with major importers with a significant

distribution network throughout the island (Sanifer or Point Pacom)

• Invest in B2B communication campain

Product H28: Home and office

furniture

HS Code 9403 Market presentation • Products from China, Malaisia, France, Dubaï, Turquie • Products for big companies, organization and SME • Mauritian products : better quality than chinese products • Trend for recycling and local manufacturing

Market analysis • Growing market • High tariff barrier: 20% IT & 20% VAT • Big markets are through procurement tenders • Domination of big importing firms: Sodim, Hazovato, Courts,

Luxor • Stiff competition from Asian products (Indonesia) especially for

hotels

Market approach • Work on being on the reference tender list of supply companies • Ensure a quality standard higher than Chinese products and

equivalent to Malaysian

Mauritian products with

limited potential market in

Madagascar (13)

Tea

Sweet biscuits : dominant local products (wide range and varied packaging)

Rum (important local production) and wine (high tariff barriers)

Sanitary paper (market in stagnation)

Stationery (important competition)

Books and magazine (luxury goods)

Plastics for the conveyance and packing of goods

Cotton yarn

Denim fabric

Women blouses

PVC Opening (local taylor made)

Aluminium structure (local taylor made)

Catheters

Product A4: Tea HS Code 0902

Market presentation • Mauritian product : same price than other imported products

(Casino, Leader Price, Lipton, Twinings), with better packaging • Main player is local (TAF) and supply most of the market with a

good range of product (black tea, green tea, vanilla tea etc.) • High tariff barriers: both IT & VAT at 20% • Substitute products: infusion & herbal tea, traditional plants

• Presence of high end imported teas: Hediard, Mariage Frères, etc.

Market analysis • Well established local products with a large distribution

network (TAF) to both B2B (hotels and Restaurant) and B2C

• No wholesaler for local products: direct sales to retailer

Market approach • Target expatriate niche market in the supermarkets and

restaurants (Café-Hotel-Restaurant)

Product A1: Sweet biscuits

HS Code 1905.30

Market presentation • High consumption of local and imported products for all categories of

households • Wide range of products and well established local brands (JB,

Socobis, Bisc’Or) competing with imported products from Europe (LU, Leader Price …)

• Mauritian products : different packaging, but competitive average price Market situation • Strong demand (average unit price for packet of 6 biscuits USD 0.018)

especially for kids • Strong competition between products & brands (important

advertisement campaign) • Possible interest for new products Market approach • Promotion campaign : packaging for 6 biscuits and focus on possible

comparative advantage of Mauritian products • Approach an existing food importer to benefit from distribution synergy • Marketing mix: focus on communication & price

Product A5: Wine (HS Code 2208)

& Rum (HS Code 2203)

Market presentation • Wine : average price of Mauritian product, product mainly for high

income households, preference for imported wine • Rum : smaller packaging (50cl), Mauritian rum slightly lower price,

product widely consumed by Malagasy people • Dynamic local producers with competitive prices (wine & rum): Clos

Malaza, Lazan’i Betsileo, Dzama

Market analysis • Strong competition for a target market of connoisseurs

• Good quality / price ratio for imported wines (France, South Africa, Chile) with no reference brand (red wine average price USD 12, white rum average price USD 7.30)

• Tariff barriers implies a high-end positioning (excise duties 230%, both IT and VAT 20%)

Market approach • Wine : rely on existing importers (Soredim, Royal Spirits, Comadis) • Rum : tasting in supermarkets and restaurants

Note: advertising of alcoholic beverages is prohibited in Madagascar

Product D12: sanitary paper

HS Code 4818.40

(kitchen paper, tissue paper, toilet paper)

Market presentation • Occasional use or existing substitute product for the majority of

Malagasy

• Wide range of both local (Softy, Pastel, Dio) and imported products from France (Lotus), South Africa (Ritebrand), Egypt (Fine), etc.

• Well known and competitive Mauritian products (Nin’s)

Market analysis • Imports decreasing (-71% between 2008 and 2012)

• Market with high competition: very diverse supply (towel paper unit price USD 0.8 to 2.93, toilet paper unit price USD 0.13 to 1.31)

• Limited market to middle and high income households

Market approach • Focus on buyers (Netter, Sipromad, Leader Price, Soredim) supplying

supermarkets with competitive prices

• Partner with local distributors to access the traditional retail network (grocery stores)

Product E15: Stationery

HS Code 4820 (notebook: no precision about size, A4 80 g paper)

Market presentation A4 paper: import from France, China (ACE), Indonesia (Paper Line), South Africa (Rotatrim).

Notebooks (cahiers) mainly from France: Lauréat, Calligraphie, etc.

Mauritian product A4 paper is quite competitive

Widespread use of paper for office use

Market analysis Seasonal and limited demand for notebooks: schools and students

Strong competition between the buyers and their related distribution network: NRJ Group, Karimjee, Ucodis, Chandarana, Promodim

Market approach Adapt the notebook format to the needs of Malagasy market

Have partnerships with the main importers and benefit from their distribution networks

Product E16: books and

magazines HS Code 4901.99

Market presentation • Books and magazines are mostly imported

• Limited local publishing: Watsa, Infotourisme, Revue de l’Océan Indien, Essentielle, etc.

• Middle and high income customers

• Important second hand market

Market analysis • Limited demand and household budget

• Domination of French books and magazines (leisure & health)

• Strong interest in religious books (subsidized by Churches)

• IT and VAT exemption for educational books

Market approach • Propose innovative monthly magazine for less than USD 2 for people

between 30-50 years old.

• Target on educational (school) and training books

Product 18: Plastics for the

conveyance and packing of goods

HS Code 3923.90

• Direct import by big companies for their own

consumption (SMOI, PFOI, International Distribution,

Nouvelles Brasseries de Madagascar).

• Toamasina Port represents 95% of total imports of that product.

• Main recommandation would be to get in touch with the importers and present the product specifications and price.

Product G19: Cotton Yarn

HS Code 5204

Market presentation • Existing supply of local (Anchor, Somacou, Cotona) and imported

(Singer, DMC, etc.) products

• B2B demand: textile EPZ, embroiderers, dressmarkers, bedcloth producers, etc.

Market analysis • Market in stagnation

• Very few importers: Coats Madagascar, Shoptex, Fazal, etc.

• Retailer network of specialized shops and open markets (pavillon in Analakely)

Market approach • Contact the existing importers for a possible diversification of product

range

• Identify partnership opportunities with EPZs

Product G21: Women blouses

HS Code 6206

Market presentation • Competitive Mauritian product

• Various brands, locally EPZ produced (Cacharel) and imported from China, Thailand or Europe (Prada, Sinéquanone)

• Good quality Mauritian products but still new to customers

Market analysis • Limited demand: strong competition of tailor made clothes, of the second-

hand market and EPZ by-products (specialized shops like Océane or CMH)

• Target market: middle and top management women. But they have opportunities to buy their clothes abroad

• Competition of knitted products: Tshirt, tops

Market approach • Create products with a strong brand identity and different design

• Work with a network of independent and influential distributors (Shamrock, Clementy, etc.)

Product G23: Denim fabrics

HS Code 5209

Market presentation • Existing supply imported from China by few buyers (Somacou,

Euréka, Sodam, Eden Textile) • Limited demand as consumers prefer ready to wear denim clothes,

except for designers, dressmakers, etc.

Market analysis • Competition of Malagasy manufacturing units that produce “drill”

fabric, similar to denim • Distribution: network of fabric retailers and open markets

Market approach • Work with the existing fabric importers

Product H27: PVC opening

HS Code 3917

Market presentation • Average price for Mauritian products

• Well established local producer (MIM), and importer (ABC-Construction – made in china)

Market analysis

• Wooden, steel and aluminium products are prefered (safer and stronger)

• Strong competition, based on price and quality

Market approach • Target retailers that supply aluminum products and wish to expand

their range to PVC

• Offer standardized and limited models of opening structures

Product H24: Aluminium structure

HS Code 7610

Market presentation • Maurician products : European standard products

• Important local producers (Europ’alu, Zital, France Alu, Alutech, Alutrade, FDC) are specialized in aluminium stucture

• Competitive, taylor made and technically assisted local production

Market analysis • High demand due to the increase of new constructions

• Influencers (architects and engineers) are important: clients are reluctant for fear of counterfeit and poor quality

• Iron or steel often prefered to cheaper structure in wood, (iron is still prefered on mass market because its manufacture is cheaper)

Market approach • Offer standardized and limited models of opening structures

Product I30: Catheters

HS Code 9018.39

Market presentation Imported products from France, Réunion and Mauritius by few importers (Drogemad, Opham, Salama, Medical International, etc.)

Medical International, subsidiary of a Mauritian group, is an important player

No market for coronary catheter: only and occasional buyer is the “Polyclinique d’Ilafy »

Market analysis Main players: Medical International and Chem Tech

Fluctuating market and restricted stock (and budget) for public hospitals

Other buyers: pharmacists (retail sale for individuals, most hospitals require that patients provide their own material and medicines) and private clinics

Market approach Partnership with one of the two major players

Contact smaller companies to complete their product range