PlanetRetail.net 17 October 2006

In Thailand, Carrefour has urged rivals to shelve plans to enter more isolated neighbourhoods and regions by opening so called "express markets". The retailer has said that hypermarket chains should agree to stop opening stores smaller than 300 square metres. The retailer has also proposed limiting the number of discount stores that are smaller than 2,000 square metres to minimize the competition with traditional 'mom-and-pop' shops. "Small outlets directly compete against local retailers, which have forced them out of business. That is a cause of the problem we are facing in Thailand," Carrefour said a statement. Tesco, which has plans to double the number of its small outlets to 200 by the end of this year, said it abides by government regulations. "In every community where Tesco Lotus operates, we consult with local officials and businesses about the impact," said Darmp Sukontasap, head of legal affairs for Tesco's Thai unit. Meanwhile, small shop owners announced that they will ignore a ban on protests imposed after last month's military coup and have staged a protest in Bangkok to demand that Tesco halts its expansion plans. "Our single request is to stop Tesco Lotus from opening its outlets in outlying areas where local shops have been hurt," according to Niroot Vatcharapichart, head of the Federation of Thais Opposing Foreign Retailers. "We hope the government will understand that we are not challenging martial law. We just need help from the government."

Authors: Moustier, P. (et al.)
Produced by: International Finance Corporation (IFC) (2005)
 
The study assesses conditions for an increased involvement of the poor in the food value chains driven by supermarkets and other value-adding outlets. The trends of the different distribution chains were analysed through the gathering of secondary data. Surveys on poor consumers' access to different retailing points were made in Hanoi, Ho Chi Minh City and Moc Chau, as well as comparison of prices between the different points of sale in these cities. Four case studies investigated poor farmers' and traders' participation in distribution value chains.

PlanetRetail.net

In a dramatic turn of events in Thailand, the military backed government has threatened larger retailers, mostly foreign owned groups, with prison terms of up to three years or fines up to THB6 million (USD156,193) in a bid to slow down expansion plans and protect smaller stores. Karun Kittisataporn, the ministry's secretary general, said it had drawn up guidelines banning big supermarkets from selling goods at 'unfairly low prices' and giving too large discounts to shoppers. If giant retailers fail to comply with the guidelines, they could face either jail terms for company representatives or fines or both, Karun said. While the guidelines are set to take effect next week, they lacked numerical details. The commerce ministry and major retailers were scheduled to hold talks today

Planet Retail   14 September 2006

The Thai government yesterday failed to convince large store chains to curb their store expansion plans. The signature of a pact presented by the Commerce Ministry to 15 retailers, including Tesco Lotus, Carrefour and Casino owned Big C, has had to be postponed to next Wednesday. "We summoned store operators to sign a memorandum of understanding (MoU) today, but they have not responded to our request because several companies, especially Tesco, said they did not know what was in the MoU," Deputy Commerce Minister Preecha Laohapongchana told reporters. "We'll give them a week to study it and if they still decline to sign, we will issue a ministerial regulation to make them comply in two weeks."

In Thailand, the Commerce Ministry has established a special committee, which met yesterday for the first time, to establish new rules, principles and guidelines for the expansion of retailers. The ministry plans to announce its results in 30 days. Karun Kittisataporn, permanent secretary for the commerce ministry, has also threatened hefty fines or even prison sentences for big retailers who mistreat their suppliers. According to ministry guidelines unveiled earlier in the week, retailers are prohibited from "unfair practices" such as selling products below cost, asking suppliers for deep discounts, demanding higher "introduction fees" for new products, and returning products without valid reason. Violators may be fined up to THB6 million (USD160,000), or jailed for up to three years.

As the small South Asian country prepares to enter the World Trade Organization, economists predict a drastic change of pace in the locally-driven economy as corporate retail is bound to take over.