Myanmar coffee scene fuelled by middle class caffeine high

YANGON – Behind a wooden counter in downtown Yangon’s Coffee Club, the unmistakable hiss of a barista steaming milk briefly drowns out a funky soundtrack piped through a store filled with students glued to their smartphones.

In any other Asian capital it would be a ubiquitous sight. But in Yangon, this is something new.

Long absent from the region’s booming cafe culture, Myanmar’s commercial capital is now witnessing a surge in swish coffee bars providing an alternative to the treacly instant coffee served by thousands of street carts.

It is a trend that points both to the changing tastes of Myanmar’s emerging middle-class but also the widening gap between them and the nation’s poor.

Nyi Nyi Tun, a doctor, is typical of the newly aspirant customers relishing consumer goods that were either far beyond their reach or simply unavailable under Myanmar’s brutal and economically incompetent military dictatorship.

“I came here to read,” he said, sipping an americano and perusing the web on a tablet. “With friends, a streetside tea shop is better. But if you want to be somewhere alone and quiet, then this kind of coffee shop is good.” To escape the noisy onslaught of Yangon’s increasingly vehicle-clogged streets, Nyi Nyi Tun is willing to fork out as much as US$2 (S$2.71) – ten times what a traditional Myanmar coffee made from pre-mixed sachets and condensed milk costs at roadside stalls.

‘Exponential growth’

In the last few years since the end of outright military rule in 2011, around two dozen speciality coffee shops have opened up in Yangon alone.

“You will witness exponential growth of the coffee industry in the next three years,” predicts Ye Naing Wynn, managing director of the Nervin Cafe chain – Myanmar’s oldest – which now boasts five outlets including in Mandalay and the capital Naypyidaw.

“A country like Myanmar has newly opened up. People have been closed up for so many years. The natural human reaction is they want to experience new things,” he adds.

Initially it was the large influx of expats and tourists that helped foster Yangon’s nascent coffee scene. But owners say locals now make up the majority of drinkers.

“That’s my target audience going forward to be honest… because any food and beverage business that relies 70 per cent on locals ought to do well in the long run,” says Thura Ko Ko, who returned to Myanmar from overseas four years ago and opened The Coffee Club above another of his businesses – a mobile phone shop.

It helps, he adds, that speciality coffee is seen as something aspirational and trendy.

“Sometimes I sit in and I overhear some new local customers try and they’re not quite sure what a cappuccino is – but they’ve seen it (on) the TV, they’ve seen it online and that’s been a big influence in lifestyle as well. Everything from Korean soaps to films,” he says.

Out of reach

The economic potential of Myanmar’s growing middle class is not lost on international companies who are scrambling to access one of Asia’s last untapped markets.

In 2013 Starbucks CEO Howard Schultz hinted during a trip to Thailand that he was eyeing Myanmar while Carlsberg is also hoping to break into the beer market – an area currently monopolised by the country’s military.

Management consulting giant McKinsey believes up to a quarter of Myanmar’s population could be living in large cities by 2030 – up from 13 per cent in 2010 – while the economy, if managed properly, could quadruple from US$45 billion in 2010 to US$200 billion by 2030.

Source: asiaone20news

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