U Soe Thane himself has said that Myanmar’s moment is now, and that this is the year of implementation of the reforms. From your point of view, is the implementation process going well?
We started to hear about the reforms about two years back. It was really more what you heard and not what you saw; we didn’t see many changes happening on the ground. However, starting this year we have started to see some policy changes. We can feel it and experience it now; it is beginning to impact the day-to-day lives of the people. This government has an enormous task, as you can imagine it’s been nearly fifty years of organized bureaucracy and the laws and regulations did not mirror reality. Things were very disorganized, so this government has done well with tackling this task. At the same time, however, you see a lot of people are frustrated with what’s really going on. They have faith in the government but are frustrated by the processes. Although the government shows its determination to change, the people believe they do not have clarity on their objectives and what is to happen for the future of this country. However, I think that this kind of controversy and doubt will always be there no matter the country. This reform process is not easy, especially because of the capacity issue the country is facing. After fifty years of isolation it has created a lack of human resources to fill positions in all levels. Therefore the reforms will take a long time and it will have its turbulent moments.
Do you think that Myanmar has the ability to catch up despite the challenges it faces in human resources not just through a skillset but also through mentality? How are you addressing the issue in your business?
On the positive side the Burmese tradition and culture we have good people with good behaviors and values. They are very willing to learn. The downside is the educational system did not benefit those who attended. Two thirds of those who went to university came out of a program called distant learning, where they are not required to attend classes but the last week prior to the exams. Because of the type of education given is really basic, we need to train everyone from the beginning. Therefore, the training process is long, but as I mentioned earlier they are very willing to learn, so we acquire good people out of this system.
Do you do your own training? Has there been discussion of setting up vocational training institutes, or alternative forms of training education?
Currently we have four thousand plus employees, so we have our in-house training division, where we train all levels of our staff. We also hire higher-level trainings from training schools in Myanmar. We work closely with some foreign consulates to come up with some training methods, especially in the areas where we do not have knowledge. We are also thinking about setting up a retail training school, however it is still in the beginning stages and we are still considering how this will be achieved.
Where do you see opportunities, what are the sectors that you would consider to be great potential for international companies looking to come into Myanmar?
I would say that this country has a lot of opportunities in every sector, because we have a big population size with low development in every sector. So generally speaking I think this country has opportunities in all kinds of sectors. For example, if we were to take advantage of the land size of this country, you could see that food manufacturing and food processing has a lot of potential. This is because when you look at our neighboring countries, like Thailand and Vietnam, this country has a larger land size and has the right environment to grow on all aspects. There are bigger opportunities in this country because of its lack of development across industries.
Where do you think the medium sized businesses come in?
Current FDI law still does not permit trading companies to operate in Myanmar, but apart from that all kinds of service sectors and manufacturing sectors are very open to foreign investors. Therefore, I would reinforce that since we have such a low base this country can take any kind of investment and have the opportunity to grow in whichever sector. You also have to remember though that it is not an easy country because of the bureaucracy and the lack of clarity with the rules and regulations. It’s not necessary to have a local partner, but it would be an advantage to have one because of their knowledge of the local climate.
Could you please give us a little bit of a background on how you got started and how you managed to keep continuing to grow?
This country first opened up in 1992. After the election we started seeing foreign investments coming into the country. Before that we experienced socialism and no private businesses. My family was operating a very traditional trading business during the socialism, and it remained modest because it was not permitted to own large businesses during that time. After 1992, the country opened up for investments and people could begin registering businesses. My family began looking around trying to determine what could be a new opportunity and was convinced to do a supermarket. I was still studying in Singapore at that time, however, there was a need for a manager, so once I completed my education I came back to take over the businesses. We had our first store where we were selling imported products and our customers were mainly expats. Except for foreigners and locals, who had lived abroad, we did not have that many customers. This is because people were consuming very basic food products, and the lifestyle was not necessary for them to go to a supermarket, not to mention that the local people believed we were very expensive. However, when we began looking at other countries and how their supermarkets developed, we realized that operating a supermarket is a volume game, so I knew that we needed to open more branches. After having opened our third branch we noticed more locals shopping at our supermarkets. After our fifth and sixth opening we could see that supermarket shopping had become a part of people’s lifestyles.
Tell us a little bit about how you got started with the “Love and Hope Foundation”.
We started to do some social contribution ten years back. We were also quite active during Nargis. It was probably from that experience where we started to see how the business could impact the lives of the people, because during Nargis supplies were very scarce. Again it’s all about timing and the moment, it was a once in a lifetime moment. When Nargis hit Yangon, the supply was cut off, because all the factories were down and the roads were closed, but we were the only ones to open the next day without a price increase. We just felt that we needed to do this because otherwise how would our customers survive. We didn’t think that the impact would be so great, but when we opened for business as usual we received a lot of recognition. This is how I began to think that we should start doing this all the time and include social responsibility within our way of doing business.
From what I understand the foundation is involved in all different programs. What are some of your priorities? Where are you hoping to take your company moving forward?
There are five areas that we want to contribute to: environment, education, rehabilitation, health, and livelihood. To this day we are concentrating on environment awareness and health. Our vision is that whatever we do we want to do our best. There is no point in doing business if you cannot do your best. Currently we are doing distribution so we will strive for excellence. We want to raise our standards everyday, so with the consumer involvement we are coming up with new standards for our customers. Currently we are market leaders in all the retail formats that we are engaging in and we wish to maintain our standing in coming years. We will continue to do what we are doing and eventually branch out into various areas in Myanmar.
What does the ASEAN economic community, what will that offer you in 2015? Is it a positive change on the horizon?
I think for Myanmar the ASEAN free trade economy is more of a challenge because this country has just opened up and we have a new environment that everybody has to adapt to. Now we’re going to have a new environment again in 2015 so it’s going to be a big challenge for the country to have to suddenly change. This country is not ready for the social and business side to it. We are preparing ourselves with supply chain infrastructure, technology and staff training, but we are not ready, we need more than that.
What has kept you going through all the difficult times? What would you tell the international investor looking at Myanmar? Is it time to start researching now?
I have also asked myself this question. I think overall it’s the satisfaction that you can deliver something and that is not for yourself but for the community. Retail is very broad based and you touch many lives. The satisfaction that many people feel the benefits of this business is what drives me. Right timing is very important. I have always believed in first mover advantage, so if you have an interest in Myanmar don’t hesitate to come in or wait for things to fall into place because then it may be too late.