Lao barber wages marketing fight against foreign-owned shops

Saphavanh Chanthalack, who owns the Phontong barber shop in Chanthabouly district, displays a colourful banner at the front of her shop, giving an eye-catching message that her business is owned by a Lao national. She put up the sign at the start of the year.
“I want Lao people to know that my shop is Lao, not foreign-owned. I hope this message appeals to the hearts of Lao customers who want to support Lao business,” she told Vientiane Times last weekend.     
Ms Saphavanh has been operating the barber shop for more than 15 years. But she has never before faced such strong competition, as more and more foreigners have opened up similar businesses.
“Looking around this area, there are plenty of foreign-owned barber shops. If I don’t do anything new, I may not be able to survive because the foreign-owned shops offer cheaper services,” she said.
Based on her assessment of business in recent months, Saphavanh said more and more Lao people have been coming in for a haircut, adding that this is strong evidence that her marketing strategy is effective.
She said that although her business sees little negative impact from the growing number of a foreign-owned barber shops, she urged the authorities to investigate whether her foreign competitors have business licences and pay their taxes.
She wondered how foreign-owned businesses were able to operate given that their charges were lower while still having to pay high rental fees, adding that it was unfair to Lao businesses if foreign-owned shops did not pay the full amount of taxes. 
Under Lao law, all businesses must obtain a business licence and use this as ID to pay tax to Lao authorities. But these laws do not authorise foreigners to operate a barber shop as this line of work is reserved for Lao nationals. In theory, this means that foreign nationals cannot get a business licence and therefore cannot pay taxes.
Last month, the Ministry of Industry and Commerce issued an administrative order urging trade officials to impose fines on the owners of businesses that did not have a licence to operate.
After receiving two warnings, businesses that infringe this rule will be ordered to close under this ministerial decision.