Dao coffee brand brewing regional expansion
Dao coffee brand brewing regional expansion
Dao-Heuang Group, one of the largest coffee makers in Laos, has stepped up its efforts to expand business into neighbouring countries ahead of the establishment of the Asean Economic Community (AEC) in 2015.
The company is now expanding its business into Thailand and Vietnam, aiming to use these countries as both regional production bases and markets.
The group's vice president Ms Boonheuang Litdang disclosed recently the company had appointed a Thai manufacturer to produce cans of its ready-to-drink coffee, one of its new products, which it hopes to sell in the local and regional markets.
At present, the company produces mainly instant coffee for local and foreign markets. Dao coffee is also focusing on advertising on Thai TV, hoping the move will lift the Lao company's profile amongst both local and foreign consumers.
As part of efforts to establish Thailand as one of its production bases, Dao-Heuang Group is negotiating with farmers to grow coffee under contract on 1,000 rai (160 hectares) leased in the northern regions, probably Chiang Rai and Chiang Mai, according to a report from The Nation .
The Lao company is also negotiating with farmers in Ubon Ratchathani province to grow taro on 1,000 rai of leased land to supply its dried-fruits plant in Pakse, Laos.
The company also plans to invest US$613,000 in a coffee-roasting plant in Ubon Ratchathani's Warin Chamrap district this year.
Dao-Heuang Group recorded sales of coffee products worth 650 million Thai baht (US$20 million) in Thailand last year.
In Vietnam, the group plans to open its first duty-free shop outside Laos near Ho Chi Minh City next year, with an investment of US$306,000.
Meanwhile, the group plans to open two new duty-free shops in Laos, one this year and another in 2015. These new stores in Laos and Vietnam will increase the number of its duty free shops to 10 from seven currently, Ms Boonheuang said.
She added that when the AEC comes into full effect next year, it would open up business opportunities for the group in Asean countries, helping drive annual revenue growth to an average of 20-30 percent.
Last year, Dao-Heuang Group recorded revenue of US$160 million and expects to double that to US$320 million by 2018. Up to 80 percent of the group's revenue comes from its coffee business, and the rest from its other businesses such as duty-free, hotels, retail and property in Laos.
Of its coffee revenue, 80 percent comes from exports to Japan, the United States, Europe, China, Vietnam, Myanmar and Cambodia both under its own brand, Dao, and those of its customers.
vientiane times
