The global climate, as in Thailand, has changed dramatically and become more volatile, resulting in an uncertain number of crops (that are used as raw materials) and risk of unexpected fluctuation of raw material rates for oncoming years. Having prepared ourselves, the Company pays attention to farmers and suppliers of necessary stock around the World, in order that the sufficient volume of raw materials are supplied at suitable prices. As a part of the preparation, the Company continues searching for sources of better quality raw materials and places orders in advance, among other methods.
The beverage industry has become fiercely competitive. Many large manufacturers are launching pricing strategies as their tools in the terms of competition. However, the Company’s market strategy involves focus on quality along with brand development through advertisement, public relations and other marketing activities, instead of reducing prices. In addition to domestic competition, the ASEAN Economic Community (AEC) has raised challenges and competitiveness among countries. In order to release quality products and services with fine reputation, the Company continues developing new manufacturing ideas to meet consumers’ demands for healthy lifestyle. The Company also organize various activities that will boost sales as well as distribute products extensively in order to support consumers’ needs thoroughly and continuously.
Despite high sales costs, supermarkets, discount stores and convenience stores in the modern trade category, are gaining more and more bargaining power. The Company has drawn plans to balance properly the sales proportion between that on the modern trade channel and the traditional one, as here is determination to maintain the bargaining power yet avoid too much reliance on the growth of modern trade. The Company also aims to control and manage costs on each channel for the best efficiencies.
The Company has run the original equipment manufacturing business for more than two decades. We make plans for operations and strategies to weaken risks by diversifying both clients and products. This will balance revenue and stability. The strategies are applied to a variety of products, such as tea, coffee, juice, several types of drinks and canned fruit. In accordance with customers’ demands, the Company offers a wide range of services, including the development of recipes, production and sales of products. It discusses all the time with partners about operation plans so that we share the same goals and benefits in a long term, and that they are confident and trust in the quality of products. We also maintain close coordination with partners in the regular development of new products. By doing so, the Company is lessening the possibility of contract termination or renewal rejection. We are also able to negotiate for suitable returns.
The global economic conditions are impacting currency exchange rates what fluctuate heavily. In order to manage and reduce risks of currency exchange rates, the Company controls the volume of advance product sales and secure some forward contracts. We plan for the natural hedge between exports and imports of raw materials and packages. Besides, a majority of the Company’s exports are bahtdenominated.
Abico Holdings Public Company Limited is a major shareholder in the Company with a stake of more than 25%. That means when the Company makes important decisions that require at least three quarters of votes from meeting participants, it needs votes from this shareholder. However, the shareholder assigns its directors to be representatives and executives in the Company. Our committee and executives are well aware of good corporate governance and take into consideration utmost benefits for the Company’s shareholders.