When talking about consumer products in South East Asia, the Philippines is often ignored. However it’s worth taking a look at the food and beverage industry in the Philippines to learn how you can leverage this fast growing market for your brand.

A couple of general points about the Philippines

The Philippines is a market of around 110 million people with an economy that generally is growing at around 7% p.a. – this is expected to continue.

In 2022, the food and beverage retailers in the Philippines had sales worth a whopping 33 billion U.S. dollars, and experts predict that this number will increase by around two billion U.S. dollars in 2023. The retail food industry in the country has witnessed remarkable growth in sales value annually.

When it comes to food retail goods, packaged foods reign supreme in the shopping carts of Filipino consumers. This is evident from the consistent growth in the retail sales value of packaged foods across the country. Among these, processed meats, seafood, dairy products, savoury snacks, edible oils, and staple foods like rice, pasta, and noodles top the list as the most popular types of packaged foods in terms of retail sales value.

The COVID-19 pandemic has brought about a surge in online food delivery services in the Philippines. This adaptation was driven by the need for safe and convenient food options, leading to a significant increase in the industry’s revenue from 2019 to 2020. The online food delivery segment is divided into grocery delivery and meal delivery. According to a recent survey, Food Panda and GrabFood emerged as the leading food delivery apps in the Philippines, catering to the growing demand for online food services.

At the same time, after one of the world’s longest lockdowns, the Philippines have been experiencing a boom in the hospitality industry with consumers eager to go out to eat.

Traditional Filipino Food

Now don’t all hate on me, but whilst there are many reasons that I’d recommend you visit the Philippines, the food isn’t one of them for me at least. That probably has a lot to do with not eating seafood or pork, and the fact that lots of restaurants don’t even really serve vegetables. It’s always flummoxed me a bit, when you look at the fabulous food you can get elsewhere in the region, but it is what it is.

There are Malay, Chinese, Spanish, Mexican and American influences in Pinoy cuisine which should make it a flavour bomb, but it often isn’t. The main food groups are meat (most often fried), fish, rice and sweets…

Having said that there are many individual dishes that I enjoy (chicken inasol from Bacolod, chicken adobo, as well as many desserts) but I find the lack of veg hard to cope with for more than a couple of days. (My solution: the cheap canteens at open markets where there are often a range of veggie dishes on offer).

Chicken inasol in Bacolod
Chicken inasol in Bacolod

However dishes such as roast suckling pig, halo halo or spring rolls can be found on most local menus. You can find a list of the 50 most popular ones here on Taste Atlas.

Local food production is dominated by preserves, packaged foods, baked goods, snacks, sweets and drinks (both with and without alcohol).

Requirements for Importing Food and Beverages to the Philippines

To import food products into the Philippines you basically have to get approval from two regulatory agencies:

  1. Food and Drug Administration (FDA). FDA is responsible for ensuring the safety and quality of food, drugs, and cosmetic products sold or imported into the country. 
  2. Bureau of Agriculture and Fisheries Standard (BAFPS) in the Philippines if you import agricultural or fisheries products.

The FDA is responsible for issuing the documents required for import, including the Licence to Operate (LTO) and the Certificate of Product Registration (CPR).

Pharmaceuticals, food and cosmetics can only be imported by approved companies and the products must be registered in advance.

Import licences must be applied for in advance, which can take some time. I’d therefore recommend working with local import companies that already have the necessary general permits (LTO) so that you just need to apply for the product registration.

Import Licences

In order to import goods into the Philippines, the importing company must be accredited with the Bureau of Customs. This accreditation requires approval from the Bureau of Internal Revenue. An import licence can only be applied for with this Importer Clearance Certificate or Customs Broker Clearance Certificate.

Ideally the importer should have this certificate or Licence to Operate (LTO) before the goods arrive in the port. Otherwise you have just 30 days to obtain the missing certificate before the government seizes the goods.

Import Restrictions for the Food and Beverage Industry in the Philippines

Pharmaceuticals, food and cosmetics can only be imported by approved companies and the products must be registered in advance. The approval is granted by the Bureau of Food and Drugs (FDA).

The import of fresh or frozen meat is subject to a permit from the Bureau of Animal Industry (BAI). Fish are subject to Bureau of Fishery and Aquatic Resources (BFAR) approval, whilst plants are subject to Bureau of Plant Industry (BPI) approval.

Obtaining a Certificate of Product Registration is essential when exporting food and beverages to the Philippines

If you’re looking to import food into the Philippines, one of the crucial requirements is obtaining a CPR (Certificate of Product Registration) for each item. Here’s a breakdown of the steps involved:

  1. Determine the Regulatory Authority: First, identify the specific regulatory authority responsible for handling food product registrations in the Philippines. This authority varies depending on the type of food product you wish to import – see my point above regarding extra requirements for meat or aquatic products.
  2. Prepare Required Documents: Gather the necessary documents for your CPR application. This typically includes product details, such as the product name, ingredients, formulation, packaging details, and labeling information. You may also need to provide a certificate of analysis, manufacturing process details, and proof of compliance with relevant food safety standards.
  3. Engage a Local Representative: It’s advisable to engage a local representative to act as your authorised agent, who is familiar with the local regulations and can assist you throughout the registration process. This can be your importer.
  4. Submit Application: Submit the completed application, along with the required documents, to the regulatory authority. Ensure that your application is accurate, complete, and adheres to the specific requirements outlined by the authority.
  5. Review and Evaluation: The regulatory authority will review your application, inspect the product’s compliance with local regulations, and assess its safety and quality. This evaluation process may involve laboratory testing (which you have to pay for) or a review of relevant documentation.
  6. Compliance Assessment: If any issues or discrepancies are identified during the evaluation, you may be required to address them accordingly. This could involve providing additional information, making necessary adjustments to the product formulation or labeling, or conducting further tests.
  7. Issuance of CPR: Once your product is deemed compliant, the regulatory authority will issue the Certificate of Product Registration (CPR). This certificate confirms that your food product meets the necessary standards and is approved for importation and sale in the Philippines.

Remember, the process may vary depending on the specific food product and its classification. It’s essential to stay updated with the latest regulations and requirements set by the Philippine authorities to ensure a smooth importation process for your food products.

food and beverage industry in the Philippines - obtaining a certificate of product registration

The CPR is then valid for 5 years before it needs to be renewed.

The time scale that I’ve mentioned in the diagramme above is the official one – it can take significantly longer if additional documentation, product changes or simply bureaucratic delays are involved.

The Food and Beverage Industry in the Philippines in Retail Numbers

Supermarkets in the food and beverage market in the philippines
Hypermarkets in the food and beverage sector in the Philippines
Warehouse Clubs are important when exporting food and beverages to the Philippines
Don't forget about Convenience stores when importing food and beverages to the Philippines

In terms of volume, gastronomy is dominated by chains such as McDonalds, Starbucks, Jolibee, KFC, Dunkin’ Donuts, Pizza Hut…However there are huge numbers of individual restaurants, street stall kiosks, cafes etc.

Importing Meat

If you are looking to bring fresh or frozen meat into the country then bear in mind that there are additional hoops to jump through (as is the case in the whole of Asia) and that the length of time required to get permission to import is considerably longer.

The type of meat allowed to be imported from your country depends on any diseases which are present. eg if there are cases of African Swine Fever then probably pork will not be allowed.

For some countries there is a general agreement that all producers can export types of meat, but for most it is company specific. Processed meat is handled by the FDA though, rather than the BAI.

Importing Food and Beverages to the Philippines

Make sure that your documents are 100% correct and complete before submitting to the customs authorities of the Philippines. This will avoid unnecessary delays and additional costs. Basically, documents have to confirm the contents, value and origin of the shipment in order to determine the duties which are due.

Documents should include:

  • Packing list: A list of the contents of each package or container of the imported goods.
  • Invoice: Must contain the details of the sale, including the description of the goods, the quantity, the price, and the terms of payment. It’s a good idea to include the HS code here too.
  • Bill of lading: A document that serves as a receipt for the goods shipped and provides information about the transportation of the goods. This will be prepared by your freight partner.
  • Certificate of product registration CPR: As detailed above, you need to show that the FDA has authorised the importation of the specific items included in the shipment.
  • Certificate of origin: A document that provides information about the country of origin of the goods to determine the applicable tariff rate. This can be a complicated topic if you have imported raw materials before production.

You should note that the tariffs for the Philippines are relatively complex (& in the case of alcohol, high). There may be free trade agreements in place which affect your products, or you may be affected by quota tariffs that can make it difficult to plan.

Import duty is determined on the basis of the so-called “customs value” of your products: these are all the costs incurred up until that point in the supply chain generally. So, product costs, all freight costs, insurance etc.

On top of that comes 12% VAT and then any applicable excise (this can be up to 50% – this is why I suggest doing your due diligence up front to establish whether your product will be financially viable in any specific market).

These fees have to be paid before your importer can take control of the goods, deliver them to his warehouse and begin to sell.

The Food and Beverage Industry in the Philippines is Challenging

The market itself is huge, however it’s not a walk in the park. As you can see, I’ve given an overview of the product registration and import process here, but dealing with the authorities of any developing nation will challenge your patience. However, unlike for Malaysia or Indonesia, there’s at least not such huge pressure to have halal certification, which is an obstacle for many brands.

The timings I’ve given are approximate and can also be significantly longer. Having an importer with the right connections can help to speed up the process.

You also need to remember that as with Indonesia, last mile logistics can be challenging, due to the distances involved and the many islands. That makes deliveries even more expensive than elsewhere.

It’s not all bad news though as the Philippine consumers are keen on imported products, and are turning ever more to innovative ingredients and healthy living. The market IS rather price sensitive, but that certainly doesn’t mean there isn’t a middle and upper class who are also looking for premium products.

One huge factor in favour of working with the Philippines is the general good level of education of the Filipinos including a decent level of English (even though it’s not an English speaking market per se). This makes it easier to do business and also means that you can explain product USPs more easily to consumers when you’re looking to enter the food and beverage market in the Philippines.

Filipinos are totally addicted to social media, such as Facebook and Instagram and whilst of course you need to tailor campaigns to fit the market, you can also benefit from your footprint in other English speaking markets. Yes, you need to work closely with your importer/ distributor to make sure the activities match your brand, but that is the case in every market.

What I’d mention finally is a reminder that the market is huge, the population is young and open to spending money on imported products. The market is a little under the radar, meaning marginally less competition so with the right import partner and strategy you could be set for long term growth here.

I’ll do a 2nd post some time soon to cover trends in the food and beverage sector in the Philippines.

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Kathryn

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