Thai Beverage set to invest Bt15 billion as it chases premier position in the region

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Thai Beverage set to invest Bt15 billion as it chases premier position in the region
KWANCHAI RUNGFAPAISARN
THE NATION


Thapana

BANGKOK: -- DRINKS CONGLOMERATE Thai Beverage's quest to become the market leader in Asean will see it invest up to Bt15 billion in a regional expansion over the next five years.

The Sirivadhanabhakdi family-owned group said Thailand's sluggish economy would not affect its long-term business plans and it was confident the economy would turn around soon.

As part of it expansion, ThaiBev plans to create new products and encourage its agents countrywide to work hard to increase sales.

Thapana Sirivadhanabhakdi, ThaiBev group president and chief executive, said the company was driving it business in line with its 2020 vision.

He said the company planned to cash in on the tremendous economic growth potential in Asean as a result of the trade liberalisation that followed the implementation of many free-trade agreements.

"We believe in the potential of Asia, particularly Asean," he said. "The combined GDP [gross domestic profit] of all member countries in Asia is as high as 80 per cent of the world's GDP but most well-known international brands in the region are from the east, particularly Japan and South Korea.

"There are no brands from Southeast Asia, which has great potential to be successful and be able to raise its reputation in the international arena."

ThaiBev posted 4.5 per cent growth in the first six months year on year, with revenue of Bt84.6 billion. Its net profit increased 8.2 per cent to Bt12.4 billion.

Its sales growth, however, was below the targeted 12-15 per cent for the whole of this year.

In tandem with its business expansion plans, the company will spend Bt5 billion annually over the next five years on the maintenance of its manufacturing facilities.

It has not set a budget for future mergers and acquisitions.

Thapana said the government's economic stimulus measures - especially soft loans to small and medium-sized enterprises, the injection of funds to lower-income earners and public expenditure - had resulted in public and investor confidence in the economy increasing.

He said these measures should result in people's spending power rebounding in the first quarter of next year.

ThaiBev has adopted five key pillars as part of its 2020 vision: growth, diversity, brand, reach and professionalism.

It will increase profits by increasing its income from non-alcohol beverages to 50 per cent of its total income by 2020 while also boasting overseas sales.

It will focus on diversifying its brands to meet consumer needs and keep expanding its logistic networks to reach targeted customers and cover domestic and foreign sales.

Another element of its 2020 vision is the cultivation of an atmosphere of professionalism within the company.

Ueychai Tantha-Obhas, CEO of ThaiBev's Spirits Product Group, said the company was the largest maker of spirits in the world. He said it planned to develop brands that met with the sustainable growth pillar of its 2020 vision.

Brand development and making adjustments to doing business when necessary were key, he said.

He said ThaiBev had set up three subsidiaries under its Spirits Product Group: Horeca Management Co; Cash Van Management Co; and Modern Trade Management Co.

Horeca Management Co focuses on hotel and restaurant channels. Cash Van Management Co handles the distribution of products to 270,000 traditional outlets throughout Thailand, while Modern Trade Management focuses on business synergies and improving the company's bargaining power with retailers.

Prapakon Thongtheppairot, CEO of ThaiBev's Beer Product Group, said the company's mission was to make Chang Beer the No. 1 beer in Thailand by 2020.

Prapakon said ThaiBev had created logistic networks in key Asean countries, such as Malaysia, Singapore, Cambodia and Myanmar.

He said Fraser & Neave, a subsidiary of ThaiBev, had sold its stake in Myanmar Brewery to Myanmar Economic Holdings but the deal had not significantly impacted ThaiBev's beer business.

Source: http://www.nationmultimedia.com/politics/Thai-Beverage-set-to-invest-Bt15-billion-as-it-cha-30270675.html


-- The Nation 2015-10-12

[anotheruser]

Bring back the old Chang first.

[starky]

"There are no brands from Southeast Asia, which (sic) has potential to be successful"

Ahhhh Beer Lao anyone?

[starky]

Bintang? San Miguel? Tiger? Angkor? Oh silly me not Thai they can't be any good and certainly not successful

[ChrisY1]

Wonder if they'll use super stars for the advertising methods in other Asean countries?

[Laughing Gravy]

They will first have to make a beer that is drinkable to by the market leader. So with the current brew they dish out. they have no chance unless they are going to get Beer Lao. Heineken and tiger all tastes good until made here. They then taste like pish.

[jaltsc]

"There are no brands from Southeast Asia, which has great potential to be successful and be able to raise its reputation in the international arena."

However he needs to come up with a better product than the one which resulted in a laboratory analysis of: "Your horse has diabetes"

Edited October 12, 2015 by jaltsc

[JoePai]

said the company was the largest maker of spirits in the world

Maybe the CEO has not heard of Diageo

[user82374298374]

Interesting timing for this PR release dressed up as 'news' - methinks it's intended to try and diffuse the celebrity/social media brouhaha.

[FloridaExport]

Interesting timing for this PR release dressed up as 'news' - methinks it's intended to try and diffuse the celebrity/social media brouhaha.

This "news" and the other "news" about their new Chang "classic" both looked suspiciously like advertising to me.

[stephenterry]

Better spend their money on brewing a tastier beer without the chemicals.

[elgordo38]

said the company was the largest maker of spirits in the world

Maybe the CEO has not heard of Diageo

You could be wrong the word " spirits" means many things here in the LOS. Do I need to conjure up something? The business world is full of "everything is OK in the world" full speed ahead. Their engine is running on greed perhaps and not common sense. If the world does indeed go flat line some of these companies could end up with egg on their face. I read so many similar comments in the business section of the BP and its all positive. "Expected" earnings to increase well by "the sky is the limit" Even to my limited education it makes no sense. Everybody wants a seat at the business Casino craps game.

[northernphil]

said the company was the largest maker of spirits in the world

Maybe the CEO has not heard of Diageo

Isn't Diageo a footballer in the Barclay's Premier League , Manu. possibly ?

[chilli42]

Better to use the money to grill satay. What a joke. Anyway, simply a play to encourage investors. They have no intention to actually spend this money on a plan like this unless they are naive or delusional

[Katipo]

IMHO Thailand makes the worst beers in the region (excluding the Muslim countries for obvious reasons).

[JaseTheBass]

IMHO Thailand makes the worst beers in the region (excluding the Muslim countries for obvious reasons).

I suppose Australia is just outside the region, so fair enough.

[Sam Jones]

Not even beer can they make ... Hub of incompetence

[bangrak]

As far as beer is still their core business, Khun Thanapa should urgently travel the world to taste lagers locally and get some palate education, his(?) original Chang, though irregular (a crime for a lager brewer) in taste, appearance, foam, and alcohol level (guess they never really mastered the techniques after Carlsberg was kicked out...), but it had 'character', as one would say about some small local operation's product. The more recent creations were plain horrific though, worst of all the 'classic' ThaiBev has decided to make its only lager... The only 'original' element for me being, not the odd new bottle (the same shape as a Carlsberg bottle but in spotted Sprite glass...), but its content of 32cl., instead of the of 33cl., while the price remained the same, and, together with the lower excise, because the alcohol content is lower, which together could generate a few billions of extra profit, providing the consumers will go on drinking that awfull brew, what I doubt and certainly hope not...

(P.S.: I have been working inside a mega group of breweries, and appointed a member of the beer tasters' committee, so I could know, a bit, about beers)

[wolfmanjack]

IMHO Thailand makes the worst beers in the region (excluding the Muslim countries for obvious reasons).

malaysia has a lot better beers than thailand.

[JaseTheBass]

(P.S.: I have been working inside a mega group of breweries, and appointed a member of the beer tasters' committee, so I could know, a bit, about beers)

I doubt it, seeing the awful p*ss the large conglomerates try to pass off as fine beer.

If we're comparing 'sizes' I'm contracted by 2 of the big 4 (world, not Thailand) and I'd still rate Beer Laos above anything they make.