Food & Drink Opportunities

An Expert's View about Food , Beverages and Tobacco in the Dominican Republic

Posted on: 19 Jun 2012

Changes to eating habits in a country of over 10 million, rising living standards and the spread of large US style supermarkets have led to an increase in the import of foreign foods.

Sector briefing Food & Drink Opportunities in the Dominican Republic Why the Dominican Republic? The Dominican Republic has the second largest economy in the Caribbean and Central American region. It is an upper middle-income developing country primarily dependent on agriculture, trade, and services, especially tourism. Although the service sector has recently overtaken agriculture as the leading employer of Dominicans (due principally to growth in tourism and Free Trade Zones). Tourism accounts for more than $1 billion in annual earnings.  The Dominican Republic still remains among the most popular investment and second home destinations for United States, Canada, and European Citizens. The country has successfully branded it itself as premier destination that is expected to continue “According to the Dominican growing. Creating a segment of new customers requesting foreign products. National Statistics Office (ONE) in 2007 Dominicans Find general information on the Dominican spent US$3.8 million in food market conditions on UKTI’s website. The Doing Business Guide for the Dominican and non- alcoholic drinks and Republic gives an overview of Dominican US$451 million in Alcoholic Republic’s economy, business culture, potential drinks and tobacco.” opportunities and an introduction to other relevant issue. UK Trade & Investment Sector briefing: Food & Drink opportunities in the Dominican Republic wholesalers. However, this is the market Opportunities segment through which imported products reach the middle and upper classes, the target Changes to eating habits in a country of over market of most exporters. 10 million, rising living standards and the spread of large US style supermarkets have led It is estimated that about 45 percent of the to an increase in the import of foreign foods. total food and drink consumed in the country is The US, France, Spain are doing well in this imported. About 35 percent of the imported sector as are some British companies. consumer-ready products are from the United States. Opportunities are there for more British companies to enter an increasingly profitable In the Dominican Republic, the general trend in market. This is particularly true now that UK distribution channels has been to reduce the producers stand to benefit from the Economic role of intermediaries. Many importers and Partnership Agreement which means reduction local producers are distributing their products in tariffs on industrial goods, which include a directly to retailers. The importation and number of processed foods, have been distribution of processed food and beverage eliminated since the beginning of 2008. products is carried out by both independent Opportunities exist both for investing in the importers/distributors, who are the main retail sector and for selling directly to the players for this sector, and through direct market. importation by supermarkets. The large supermarket chains are importing directly a Regarding the food industry, the ingredients basic line of food products, which they handle segment is one of the most promising for exclusively. For example, Grupo CCN exporters. The niche areas for imported food & (Supermercados Nacional y la Despensa) drink items are premium international branded carries the private label brands from products as well as speciality food and drink Supervalu, such as Flovorite, Nutri Plan, Home products. The key areas of opportunity for UK Best, and Shoppers Value. Supermercados companies are the following: Bravo imports a basic line of products from IGA. Grupo Ramos (Supermercados Pola y • Ingredients La Sirena) has the exclusive representation • Organic products for Shurefine and Valuetime. In addition, Grupo • Nutritional and vitamins enriched Ramos has First Class, which is its own private processed products (functional food) label brand. These product lines are used in • Diet & light range of products much the same way as store brands to provide • Ready-to-drink fruit juices a price competitive line of basic products to • Dairy product (cheese, yogurts, etc) customers. • Preserves • Gourmet products If you have any questions on the opportunities • Frozen Food above, contact the UKTI contacts named in this • Sweets report. Business opportunities aimed • Meat and Deli products specifically at UK companies are added daily to UKTI’s website. These leads are sourced by our The Dominican Republic is becoming staff overseas in British Embassies, High increasingly dependent on imports of Commissions and Consulates, across all sectors some products. and in over 100 markets. Characteristics of the Market Advantages and Challenges in the Dominican Market The food and grocery sector represents the most significant potential in the Dominican Some of the advantages and challenges facing market, as consumer spending is highest on British exporters in the Dominican market are food. the following: According to the Dominican National Statistics Advantages Office (ONE), over 70 percent of retail food products in the Dominican Republic are sold 1) The supermarket sector is well through the traditional system of minimarkets developed and the number of called “Colmados”, 25 percent through modern supermarkets has grown nationwide, supermarkets, and about five percent by UK Trade & Investment Sector briefing: Food & Drink opportunities in the Dominican Republic providing greater market penetration Major events and activities for most imported food products. 2) Dominicans are greatly influenced by Find full details of all events in this foreign cultures and have a positive country and sector on the UKTI website. perception of their products. New export events are added daily to the site 3) The Economic Partnership Agreement, and you can register to be alerted to them on a increases the competitiveness of British daily, weekly or monthly basis. products 4) The Dominican Custom Service uses the UKTI’s Tradeshow Access Programme (TAP) WTO-approved method of customs provides grant support for eligible Small & valuation, which requires that duties be Medium Sized Enterprises (SME's) to attend applied to actual invoice prices of trade shows overseas. Find out more about imported goods, rather than average or UKTI support for attendance at overseas calculated price for imported goods. events. 5) The economy is stable and with a promising outlook. Challenges UKTI contacts 1) The local Dominican food industry is Leonora Dipp becoming more efficient and more Trade & Investment Officer competitive, as it integrates new British Embassy Santo Domingo technology and machinery into its Tel: (809) 472 7054 production processes. Email: 2) Globalization and the influence of the mass media have given Dominicans access to other cultures, e.g., USA, Claudia Fulgencio Asia, and South America. These Trade & Investment Assistant different cultures influence consumption British Embassy Santo Domingo habits here and the demand for foods Tel: (809) 472 7111 ext.2032 from those countries. Email: 3) The Dominican Republic has a free trade agreement (DR-CAFT) with the U.S. benefiting their export. 4) In the Dominican Republic, there are significant tariff and non-tariff barriers for food imports. You can be alerted to business opportunities on a regular basis by registering on the UKTI website. Find out more on UKTI’s business opportunities service on the UKTI website UK Trade & Investment Sector briefing: Food & Drink opportunities in the Dominican Republic Next steps - How UKTI can help • Arranging appointments • Organise seminars or other events for British companies wishing to develop their you to meet contacts and promote your business in the Dominican market are advised company in the Dominican market to undertake as much market research and planning as possible in the UK. This work is available via our Overseas Market Introduction Service (OMIS) a chargeable UKTI’s team in Santo Domingo, with its wide service which assists British-based companies local knowledge and experience, can provide a wishing to enter or expand their business in range of services to British-based companies overseas markets. wishing to grow their business in global markets. This can include: To find out more about commissioning this work, or accessing other UKTI services and This can include: specialist advice, please visit the UKTI website • Provision of market information to find contact details for your local UKTI • Validated lists of agents/distributors office. • Key market players or potential customers in the Dominican market • Establishment of interest of such contacts in working with you Whereas every effort has been made to ensure that the information given in this document is accurate, neither UK Trade & Investment nor its parent Departments (the Department for Business, Innovation & Skills, and the Foreign & Commonwealth Office), accept liability for any errors, omissions or misleading statements, and no warranty is given or responsibility accepted as to the standing of any individual, firm, company or other organisation mentioned. Published 2011 by UK Trade & Investment. Crown Copyright © UK Trade & Investment Sector briefing: Food & Drink opportunities in the Dominican Republic
Posted: 19 June 2012

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