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Malaysia - Selling and buying

Contents extracted from the comprehensive atlas of international trade by Export Entreprises

Reaching the consumers

Marketing opportunities

Consumer behavior: Consumers are more aware of the price than the prestige or quality of a brand.
Consumer profile: Although the GNP per capita is only 6 146 USD, the purchasing power of the Malays is one of the highest in Asia, and shopping is a favorite consumer pastime.
Main advertising agencies:

Distribution network

Evolution of the sector: The Chinese are commercially powerful and dominate the distribution network. Trade is the center of small family businesses and operates from a complicated structure of suppliers, entrepreneurs and sub-entrepreneurs.
The most influential persons in the economic activity are the public administrators, the Malaysian entrepreneurs (not many) and the Chinese entrepreneurs (who hold the most important private groups of the country).
To sell your products in the country you should call on importers/distributors (who may be a local company), foreign trading companies (which offer better specialization and more technical services than local companies) or medium sized local trading companies. Other alternatives are commission agents, setting up a representative office or making a local alliance with a Malaysian company; the last two are the most recommended options.
Types of outlet: Supply stores: 85.7%, Chinese medical shops: 6.4%, groceries: 3.8%, drugstores: 2.7%, supermarkets: 1.3%, hypermarkets: 0.08%, cash and carry: 0.02%. Although hypermarkets, supermarkets and department stores are dominant in urban areas, local retailers and small traders represent 57% of the local market in terms of sales income. Hypermarkets represent 10% of total retail sales. Groceries and service stations represent about 9% of total retail sales and are located in the main urban centers.
Organizations in the sectors:

Market access procedures

Economic Cooperation: APEC, ASEAN, AFTA and the ASEAN - China Free Trade Area.
The country have signed a trade agreement with 21 other countries in the São Paulo Round of the Global System of Trade Preferences among Developing Countries (GSTP).
Non tariff barriers: Import regulations in Malaysia are liberal compared to other ASEAN countries' regulations. Most goods can be freely imported under General Open License. Some specific sectors, considered as strategic, are protected by a system of restricted import licenses. Items covered under this category are the iron and steel industry, cement, the sector of the automobile and its components and also polyethylene and polypropylene.
The restrictions in import licensing also affect other sectors in terms of approval (electrical products) and sanitary items (foodstuffs or veterinary products), without being a protectionist measure.
Quotas are not frequently applied to imports and apply to certain products whose local production is favored (rice, meat, fruits and vegetables). In extreme cases (frozen chicken, eggs, liquid milk or sugar), if it is considered that the local production is self-sufficient, import is forbidden. There are other products that are forbidden or subject to special licenses for safety, religion or morality reasons.
Average Customs Duty (excluding agricultural products): 8.56%
Customs classification: The Customs classification of goods is based on the International Nomenclature of the Harmonized System. A majority of Customs duties are calculated ad valorem and are specific only in certain cases. Imported goods, except for machinery, its parts and components, are subject to a sales tax which varies between 5 and 10%. In recent years, duties have dropped and now fluctuate between 15 and 25%. However, certain sectors can be taxed up to 30%. The Customs tariff is high when the imported product is also locally produced (from 30 to 50 %).
In January 1996, Malaysia, within the ASEAN market, subscribed to the Common Effective Preferential Tariffs (CEPT) arrangements, which significantly increase the product list of the previous Preferential Trading Arrangements (PTA). The introduction of the CEPT is meant to accelerate the establishment of a free trade zone within ASEAN countries (AFTA - ASEAN Free Trade Area). Before 2003, all products integrated into the CEPT, will undergo a duty from 0 to 5%. Non-taxed farm products remain outside the agreement. There is currently a list of temporary exclusion for some products, in force until January 1, 2000.
Malaysia benefits from the Generalised System of Preferences, under which 14% of its exports are carried out.
Import procedures: The Customs classification of goods is based on the International Nomenclature of the Harmonized System. A majority of Customs duties are calculated ad valorem and are specific only in certain cases. Imported goods, except for machinery, its parts and components, are subject to a sales tax which varies between 5 and 10%. In recent years, duties have dropped and now fluctuate between 15 and 25%. However, certain sectors can be taxed up to 30%. The Customs tariff is high when the imported product is also locally produced (from 30 to 50 %).
In January 1996, Malaysia, within the ASEAN market, subscribed to the Common Effective Preferential Tariffs (CEPT) arrangements, which significantly increase the product list of the previous Preferential Trading Arrangements (PTA). The introduction of the CEPT is meant to accelerate the establishment of a free trade zone within ASEAN countries (AFTA - ASEAN Free Trade Area). Before 2003, all products integrated into the CEPT, will undergo a duty from 0 to 5%. Non-taxed farm products remain outside the agreement. There is currently a list of temporary exclusion for some products, in force until January 1, 2000.
Malaysia benefits from the Generalised System of Preferences, under which 14% of its exports are carried out.

Organizing goods transport

Domestic business directories

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