Exporters of fast moving consumer goods (FMCG) are being strongly encouraged to take advantage of the opportunities in the US market, given the country’s beneficiary status under the US Generalized System of Preferences (GSP) program that will cut tariffs on thousands of export products to the US.
The Department of Trade and Industry (DTI) through its Export Marketing Bureau (EMB) recently held a series of seminars on Doing Business with the United States for FMCG in Manila, Cebu, and Davao as part of its Doing Business in Free Trade Areas (DBFTA) program.
Participants including existing and aspiring exporters, other businessmen, government agencies, and local government units discussed the US market, the benefits of the US-GSP program, and the trends in mainstream US markets.
The Philippines is among the 122 beneficiary countries and territories of the US-GSP program. The program will allow beneficiary countries to export more than 5,000 products duty-free to the US, and is seen to mostly benefit local micro, small and medium enterprises (MSMEs).
Rose Marie Castillo, Division Chief of EMB-Food and Agri-Marine Division (FAMD), said the most competitive local FMCGs that can be given priority in trade with the US are electronics, fresh and processed food, design-driven products, garments, personal care products, and information technology (IT)-enabled services.
“To keep up with the demands of the US market, one must know the trends that affect consumer choices. At present, Americans are very cautious of their health. They tend to opt for healthier and organic snacks which are convenient and readily available,” Castillo said.
Nicholas Johnson, President and Chief Executive Officer (CEO) of marketing company Asia Etc., said that there are a lot of market opportunities in the US for FMCGs.
Asia Etc. is a marketing firm engaged in sourcing Asian food producers and manufacturers and then introducing them to the US market.
Johnson said FMCG exporters should be knowledgeable about US market trends and demands, suggesting that there should be investments in improving product packaging, consideration of online retailing like Amazon or Kroger, and ensuring product standards and safety.
“Nobody starts out big. You just have to work hard and concentrate on it and perhaps spend some amount of money and it will all be worth it,” Johnson said.
Johnson also conducted one-on-one consultations with existing and prospective participants right after the Doing Business with US info session where they were given specific pieces of advice on exporting to the US.
DBFTA is EMB’s initiative to increase the awareness of Filipinos regarding the benefits of free trade agreements (FTAs) and generalized schemes of preferences (GSPs).