Saha Pathanapibul looks to AEC, sets up distribution units in three countries

Saha Pathanapibul looks to AEC, sets up distribution units in three countries

Saha Pathanapibul on October 8 revealed its Asean expansion strategy, with the setting up of distribution companies in Vietnam, Cambodia and Myanmar. The move is aimed at cashing in on the ASEAN Economic Community (AEC), which comes into effect next year.

The company also expects to double its sales contribution from ASEAN markets from the Bt500 million targeted for this year to about Bt1 billion next year, excluding border trade.

The company in January set up an International Business Division, with its key primary strategy being to expand its distribution network in ASEAN markets offering good potential.

Udomsak Soponkij, executive director and head of the new division, on October 8 said Saha Pathanapibul had established wholly owned distribution subsidiaries in Vietnam and Cambodia, while in Myanmar the company had formed a 50/50 joint venture in partnership with a local firm.

In Vietnam, the government last year introduced a new regulation allowing foreign investors within ASEAN to own a 100-per-cent stake in their local business operations in the country, he added.

"For Saha Pathanapibul, we were approved by the local authority in Vietnam in February this year to set up a wholly owned distribution subsidiary in the country - Saha Vietnam. The firm will be in charge of distributing Saha Group's products within the market, and will supply products to Thai retailers that have expanded their retail networks into Vietnam, as well," said Udomsak.

The ambition of the International Business Division is to help Thai small and medium-d vendors to distribute their products within neighbouring markets in ASEAN, said the executive director.

In Cambodia, Saha Group has set up a distribution company named Kanjana, which is a joint venture between the group's three major subsidiaries: Saha Pathana Inter-Holding, International Cosmetics and Saha Pathanapibul.

Boonchai Chokwattana, chairman of Saha Pathanapibul, said the company had posted flat growth in year-on-year sales for the first two quarters. However, growth of between 1 per cent and 3 per cent was achieved in the third quarter.

"We expect to achieve 3-per-cent growth to about Bt30 billion in sales for the full year," he said.

"We have also revised our strategy for next year to be more conscious and selective in launching any product into the market," he said, with just one to three items being launched a year in future.

"Any launch will be based on an insight study of consumer behaviour and demand ... Such products need to have strong potential to be successful in the market place," he added.

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