Source | Zhixiang Going Global Wang Wei

In September 2024, Want Want spent RMB 138 million to purchase a business jet. The official explanation for the jet's use was that, in addition to facilitating management's domestic travel, it was also needed for "more frequent trips to different overseas regions."

In FY2023, Want Want's overseas business grew by double digits. Benefiting from growth in overseas markets and emerging channels, its rice cracker category revenue increased by 2.3% year-on-year to RMB 5.977 billion, with overseas markets accounting for about 20%. Want Want stated, "We must treat overseas markets as the future Chinese market."

Facing an increasingly competitive domestic market, going global has become a common choice for Chinese snack brands like Want Want. Southeast Asia, with its geographical proximity, similar cultural customs, large population, and numerous overseas Chinese, has become the first stop for most snack brands going overseas.

According to incomplete statistics, multiple Chinese snack brands, including Qiaqia Food, Jinzai Food, Panpan Food, Bestore, Weilong, and Ganyuan Food, have already established a presence in Southeast Asia.

In 2023, Qiaqia's Thai subsidiary contributed RMB 400 million in revenue, with net profit of nearly RMB 90 million, making Thailand its largest overseas market. In 2023, Panpan Food's exports to Indonesia reached RMB 103 million. Ganyuan Food, which entered Vietnam as its first stop in 2024, is expected to contribute RMB 100-200 million in revenue from the Vietnamese market in the first half of 2024.

Relevant data shows that the Southeast Asian snack market is expected to reach $13.1 billion by 2029, with a compound annual growth rate of 10.60%.

Southeast Asia's appeal is tempting latecomers.

In January this year, Yanjinpuzi established a Vietnamese subsidiary with a registered capital of approximately RMB 882,300. In February, Yanjinpuzi announced plans to invest RMB 220 million to set up a wholly-owned subsidiary in Thailand and build a production base, while also investing approximately RMB 1.0638 million to establish a wholly-owned subsidiary, Yanjin Food (Thailand) Co., Ltd. In his Chinese New Year message, Yanjinpuzi Chairman Zhang Xuewu stated that in 2025, the company will focus on konjac and quail egg categories, and deeply cultivate the Southeast Asian market.

Southeast Asia has become a battleground for Chinese snack brands, and Chinese snacks are taking over Southeast Asian shelves.

"Taking an Unconventional Path" into Southeast Asia

If we talk about the earliest Chinese snack brands to go global, Qiaqia Food and Jinjiang-based products were the pioneers, starting their overseas journeys around 2000.

However, going global in that era was relatively passive. For example, Qiaqia's overseas story goes like this: a Hong Kong agent tasted Qiaqia sunflower seeds at a Chinese New Year gathering for overseas Chinese in Beijing, found them delicious, and was reminded of home, so he became Qiaqia's first overseas agent. Qiaqia's early agents in Malaysia followed a similar path, with overseas Chinese forming the initial agent network for Qiaqia's overseas expansion.

Jinjiang-based products also relied mainly on the power of overseas Chinese in their early overseas expansion. They entrusted relatives in Jinjiang to "source goods," and then used their own freight channels to ship products worldwide.

In the early days, Chinese snacks going overseas were mostly brought out spontaneously by distributors, entering Chinese supermarkets with low entry barriers, rarely penetrating local mainstream channels. Only a few leading companies achieved brand internationalization.

Chinese snack brands began more actively seeking overseas expansion around 2018. After the rapid rise of internet snack brands like Three Squirrels and Bestore, snack brands spilled overseas. Especially after the emergence of discount snack stores in 2024 pushed prices to extremely low levels, seeking new growth overseas became a common choice for both traditional and internet snack brands.

Depending on the market characteristics of different Southeast Asian countries, Chinese snack brands' "advance routes" differ.

In Indonesia, the penetration rate of international brands is still relatively low, and average product prices are low, with no significant consumption upgrade. The Vietnamese market is similar, characterized by "low average transaction value and high SKU density."

In 2023, the Thai snack market was valued at THB 105,200.7 million (approximately $3.04 billion), with an expected compound annual growth rate of 7.16% by 2028. The market is large and mature. The Thai snack market is concentrated at the top, with the Savory Snacks group accounting for THB 47,206.8 million (approximately $1.4 billion) in 2023, representing 44.9% of the market.

Unlike Indonesia, the Thai snack market has already upgraded. In 2023, the Thai healthy snack market was valued at THB 28,314.8 million (approximately $850 million), accounting for 26.9% of the Thai snack market, with a growth rate as high as 11.3%. Among these, the sugar-free snack market was valued at THB 4,378.1 million (approximately $130 million).

Malaysia is also a huge snack market, with its market size expected to grow from $1.71 billion in 2023 to $2.28 billion by 2029, at a compound annual growth rate of 4.9%. Similar to Thailand, consumers in Singapore and Malaysia are also becoming health-conscious, with increased demand for low-sugar, natural-ingredient, and organic snacks.

This has given rise to two "advance routes": one is entering from mature markets like Thailand, Singapore, and Malaysia, such as Hsu Fu Chi, Three Squirrels, and Bestore, which helps build brand image; the other is entering from markets like Vietnam and Indonesia, such as Ganyuan Food, which makes it easier to capture blank and lower-tier markets.

From a category perspective, this wave of Chinese snack brands entering Southeast Asia has chosen categories that are somewhat "unconventional" compared to traditional categories like chocolate, candy, biscuits, and jelly, and are quite Chinese in character. For example, Weilong's categories are spicy strips and konjac snacks, while Yanjinpuzi's are konjac and quail eggs. These are relatively unfamiliar categories for Southeast Asian consumers, thus requiring more time for market education.

However, Qiaqia once displayed the method of eating sunflower seeds on its packaging in Thailand, and by popularizing the "sunflower seed eating culture," it entered the Southeast Asian market.

Before Chinese snack brands entered, Southeast Asian shelves were basically occupied by Japanese snack brands such as Calbee, Nissin, and Morinaga.

New categories carry high risks, but they also allow Chinese snack brands to leverage the uniqueness of these categories to bypass local and international brands and open up their own blue ocean. For example, for a while, spicy strips became a popular snack category in Thailand, Indonesia, and Vietnam. In a Vlog by a Thai local blogger on Xiaohongshu, it was introduced that spicy strips have become a "hard currency" for socializing among Thai elementary school students.

In Southeast Asia, Is Channel King?

In 2015, an ice cream brand called "Aice" emerged in Indonesia. It took only 3 years for its sales to exceed RMB 1 billion, becoming the second-largest ice cream brand in Indonesia after Walls.

But few people know that behind this ice cream brand is a Chinese team.

The author once had a conversation with a participant in Aice's early rise. He mentioned that one of the core competitive advantages of Aice's success in Indonesia was channel innovation.

At that stage in 2015, Indonesia was basically dominated by international food brands, especially European, American, and Japanese brands, and Chinese food brands had low trust in Indonesia. Walls had been in Indonesia for 20-30 years, with a full product line and pricing, extensive sales routes, and deep channel layout, especially occupying Indonesia's developed convenience store channels.

For a new brand, it was basically a difficult situation to break through. But Aice bypassed Walls' sphere of influence—convenience stores—and targeted large Indonesian communities, allowing Aice to go down to community mom-and-pop stores, even entering small shops near slums. Aice deployed about 50,000 small stores, penetrating the lower-tier market like capillaries. Thus, without any TV or internet advertising in the first three years, Aice opened up the situation.

For a retail brand entering a new market, channel selection and channel capability are crucial.

When Japanese snack brand Pocky entered Southeast Asia, it differentiated its key channels by country: in Thailand, it focused on large shopping malls; in Vietnam, where large malls are fewer, it focused on cinemas; and in Indonesia, it used schools as an important sales channel because private enterprises can conduct promotional activities in public schools in Indonesia. Pocky drove trucks into middle and high schools for large-scale sampling.

Hsu Fu Chi also has significant channel advantages in Southeast Asia. In Malaysia, Hsu Fu Chi covers local supermarket chains Lotus's and Aeon; in Singapore, it covers Singapore's largest supermarket chain specializing in Chinese goods, Think Super. In 2024, Hsu Fu Chi's revenue in Southeast Asia grew 50% year-on-year, with market share in mature markets like Malaysia and Singapore reaching 8%. Growth in emerging markets like Vietnam and Indonesia exceeded 80%.

Different countries require different channel strategies.

For example, in Thailand's modern retail channels, convenience stores have the highest market share at 48%, supermarkets at 26%, and hypermarkets at 18%. Additionally, Thailand is a country where 7-Eleven is strong.

Since CP Group obtained the franchise in 1988, 7-Eleven has flourished in Thailand, especially in the high-density Bangkok area, almost replacing the mom-and-pop store format. Statistics show that Thais enter 7-Eleven twice a day on average. Today, 7-Eleven has over 15,000 stores in Thailand, accounting for 70% of the convenience store market share.

Indonesia's mainstream retailers are the largest convenience store chain Indomaret, with 21,801 stores, accounting for nearly 40% of Indonesia's modern channel share, and the local convenience store chain Alfamart, with over 19,000 stores. Other retail channels include FamilyMart, mid-to-high-end supermarket brand Ranch 99 Market, local retail supermarket chain Super Indo, and hypermarket and shopping center chain Transmart.

In addition to convenience stores and supermarkets, traditional community mom-and-pop stores are a major lower-tier channel in Indonesia that cannot be ignored.

"Indonesian snacks are a big track, but 80% of consumption is still in traditional channels, such as mom-and-pop stores and roadside stalls, not chains or supermarkets. Any place with glass and air conditioning is the world of only 20% of people. Over 80% of people consume in traditional retail, on the roadside, which is the real 'mainstream' of the local market. This is also a characteristic of Indonesia's consumer retail," Ryan, former Group Director and Chief Commercial Officer of Indonesia's leading food and beverage group BOGA Group, told the author.

From Ryan's observation, most Chinese snack brands in Indonesia have only landed in modern supermarkets, entering the "world of 20%."

Ryan also mentioned that Genki Forest in Indonesia takes a relatively high-end route, with pricing twice that of ordinary bottled drinks, almost equivalent to a meal for local commoners. Therefore, in Indonesia, Genki Forest only entered modern retail, and the "world of 20%" is its main channel.

Powerful Friends

The choice of distributors is also important.

The aforementioned early Aice participant told the author that initially in Indonesia, some of Aice's distributors were brought directly from China. Local distributors respond more slowly, but once domestic distributors discover profitability, they follow up faster than imagined. When OPPO was conquering the market in its early days, it also brought its domestic distributor team to Southeast Asia.

For lower-tier markets, China's "ground forces" have advantages. But for countries with relatively well-developed modern channel networks, leveraging the capabilities of large local distributors can help expand the market more quickly.

For example, Genki Forest's distributor in Malaysia, Berjaya Group, has a retail network covering all of Malaysia, owning and operating over 2,400 7-Eleven stores, as well as channels like MyNews, CU Mart, and Emart. Genki Forest began laying out the Southeast Asian market in 2020, officially entered the Malaysian market in August 2022, and by the end of 2022 had basically completed coverage of mainstream channels nationwide in Malaysia.

In Thailand, entering 7-Eleven is very difficult.

On top of national standards, Thailand's 7-Eleven has another set of more detailed standards for products entering, even stipulating shelf positions.

Before Qiaqia entered Thailand's 7-Eleven, the sunflower seed category already had two local brands, almost saturated. As a foreign brand, Qiaqia competing to replace a local brand to enter 7-Eleven was even more difficult.

Qiaqia later, through local distributors, spent half a year, even inviting Thailand's 7-Eleven purchasing supervisor to Hefei to visit Qiaqia's factory, before Thailand's 7-Eleven agreed to list one SKU.

Currently, Qiaqia's distributor in Thailand is the same as Weilong's distributor—Wellspire.

Wellspire is a Malaysian company listed on the ACE Market of Bursa Malaysia in 2023, with its main business focused on the Thai market. Wellspire has over 15 years of experience in the snack food distribution industry, having cooperated with CP All and Ek-Chai for 8-9 years, and with Siam Makro for 6 years.

CP All is the core retail enterprise under Thailand's CP Group, responsible for operating Thailand's 7-Eleven; Ek-Chai, also under CP Group, is responsible for the retail business of Tesco Lotus, one of Thailand's largest supermarket chains; Siam Makro owns Makro, the "Thai Costco," a membership-based wholesale supermarket also under CP Group, with over 140 stores and 3 million members in Thailand.

Additionally, Wellspire covers Big C, Family Mart, and Central Food Retail, basically covering most chain store brands in Thailand.

According to Wellspire's official website, it has a distribution center in Pathum Thani Province, Thailand, with a total building area of over 4,000 square meters, and a logistics team covering central, northeastern, northern, and southern Thailand.

With the maturity of e-commerce channels, many brands are also using Shopee, Lazada, and TikTok to overtake on the curve, such as Ganyuan Food and Jinzai Food. Expanding brand influence through e-commerce and social media, and then entering mainstream channels, is also a viable path.

However, Ryan mentioned that this also depends on the country. In Indonesia, e-commerce is the world of the urban middle class, that 20% of the population. Indonesia's county towns and rural areas don't even have paved roads, and logistics are inefficient and expensive. So if a new brand only uses e-commerce channels, it's hard to connect with the 80% mass consumer population.

Banned Spicy Strips and Coconut-Flavored Sunflower Seeds

In July 2024, the spicy strips popular in Thailand were put on pause. Thailand's Food and Drug Administration (FDA) and the Bangkok Anti-Corruption Commission launched a market rectification operation targeting snacks imported from China. At the same time, Indonesia's Food and Drug Supervisory Agency (BPOM) also announced a suspension of the circulation of all spicy strips in the market, and temporarily suspended the registration and import of spicy strip products.

Spicy strips were suspected of being linked to local food poisoning, causing this "spicy strip ban incident."

"Spicy strips have been banned in Indonesia. This category at least cannot appear in formal channels, and formal distributors generally won't stock them," Ryan told the author.

For snacks going overseas to Southeast Asia, compliance is the first threshold for entering the market.

In Thailand, you need to obtain Thai FDA certification for food products. The required documents include product formulas, production processes, and raw material supply certificates. From submission to issuance takes 6-9 weeks. Thailand requires product labels to be filed before complete information can be printed on packaging and enter market circulation.

Indonesia requires that preservative content in snacks be less than 0.1%, and mandates that food importers obtain BPOM certification (Indonesian Food and Drug Supervisory Agency certification). Since October 18, 2024, Government Regulation No. 39 of 2021 (GR 39/2021) on mandatory halal certification has been officially implemented, with violators facing a series of mandatory sanctions, including administrative penalties, customs bans, product withdrawal or seizure.

Singapore requires beverages to have nutritional grade labels. Pre-packaged drinks with higher sugar and trans fat content sold in Singapore must have Nutri-Grade labels, and advertising related to "D" grade Nutri-Grade drinks is prohibited.

Beyond compliance, localization is also inevitable.

Hsu Fu Chi has launched durian-flavored soft candies in the Southeast Asian market. Panpan has introduced specialty foods like "Indonesian Shrimp Meat Chips" in Indonesia. Jinzai has improved its spicy flavors, launching soy sauce, braised, and sweet and sour flavors. Some Southeast Asian countries reject sweeteners, so Qiaqia has tried using monk fruit as a substitute, and has also developed coconut-flavored sunflower seeds for the Thai market.

A more important aspect of localization is supply chain localization.

In fact, before the wave of Chinese snack brands going overseas, Southeast Asia's fruit resources had already attracted some Chinese brands to build factories there. For example, Yanjinpuzi, which made big moves this year, actually invested in its first dried mango processing plant in Cambodia as early as 2018. Now it has built 7 overseas fresh fruit processing plants in Cambodia, Thailand, and Vietnam for mangoes, durians, and other fruits.

In addition to Yanjinpuzi, traditional snack brands like Want Want and Qiaqia have also built factories in Southeast Asia. Ganyuan Food has set up overseas warehouses in Ho Chi Minh City and Hanoi, Vietnam.

In the long run, supply chain localization is very necessary, helping to reduce production and transportation costs, improve timeliness, and seize market share in "hard battles."

The aforementioned early Aice member told the author: "In dimensions such as channel, product, promotion methods, and supply chain, as long as you find your core advantage in one dimension and don't lose to others in other dimensions, the combination will give you a chance of winning."

For Chinese snack brands going overseas, to fully occupy Southeast Asian shelves and become influential international brands locally, they need to continue to deepen their efforts in these dimensions.

Ryan divides Southeast Asian countries into three tiers.

The first tier is Singapore, Malaysia, and Thailand. Singapore should be treated separately, as it should be approached like the European or American market. Malaysia and Thailand, whether in terms of per capita GDP or culture, have similarities with China, and the retail channel formats are also highly similar. Chinese snack brands can thrive in these two countries without making too many modifications.

The second tier is Indonesia, Vietnam, and the Philippines. These three countries have weaker per capita consumption than China, with differences far outweighing similarities, and overall lower recognition of Chinese goods. To succeed here, brands need sufficient determination and actions to reinvent themselves.

The third tier includes countries like Laos, which have poor consumption capacity and can be ignored from a brand internationalization perspective for now.

"Snack brands going overseas to Southeast Asia depend on how much importance the brand places on the local market—whether it's the logic of exporting goods, or whether it's willing to personally build local influence from 0 to 1. Different cognitions determine different behaviors, leading to different strategies and development paths.

For example, in Indonesia's fragmented consumer market, whether to air-drop products to the 20% middle class in first-tier cities, or to reinvent yourself to enter the local mainstream and sell to the 80% of Indonesia's 200 million people, all depends on the brand's localization determination and actions," Ryan told the author.