Thailand CP Freshmart expands
Source：Bangkok Post Newspaper
From：Taiwan Trade Center, Bangkok
Update Time：2019/05/03
Charoen Pokphand Foods Plc (CPF), the agro-industrial conglomerate, plans to expand the CP Freshmart network to drive business towards the food segment and digital transformation.
As part of its commitment to the "Kitchen of the World" strategy, the company will use CP Freshmart, a retail chain with over 400 stores nationwide, to distribute fresh food and raw materials to the HoReCa (hotel, restaurant and catering) segment and retail customers, said Sooksunt Jiumjaiswanglerg, chief executive for agro-industrial business and co-president.
Under the new structure, CP Freshmart will operate as a customer-centric store and hub for logistics, distributing and delivering fresh food to retail customers without shop fronts, Mr Sooksunt said.
The company is also studying the possibility of building a food showroom consisting of restaurants and a food shopping area inside a space of 300-400 square metres, up from the existing 80-100 sq m of the CP Freshmart format, he said.
"In the future, Freshmart will have appliances and kitchen equipment to serve customers," Mr Sooksunt said. "The future could be entirely in the online sphere. Fresh foods, goods and services could be delivered to customers at home without the need to walk to shops."
To prepare for tech disruption, CP Freshmart will be connected to an online payment system furnished by True Corporation. Customers can use QR codes to make payments, among other methods.
CPF's business has grown from animal feed production and expanded into animal breeding and farming, which include swine production and integrated shrimp supply, together with production of processed and ready-to-eat food.
Feed production accounts for 42% of total revenue, while farming and food production make up 41% and 17%, respectively.
"We plan to migrate from farm business to food, such as processed or frozen foods, as much as possible for price stability, which could have an impact on profitability," Mr Sooksunt said.
The farm business is involved with commodities, while feed and food production are branding businesses where the company has a price-setting power and can guarantee customer satisfaction, he said.
CPF has diversified its business portfolio with operations and investment in 17 countries, catering to over 4 billion people and exporting to more than 30 countries.
Revenue from domestic business accounts for 33% of the total, comprising domestic sales (28%) and export sales (5%), while overseas revenue makes up 67%.
Total revenue is targeted at 600 billion baht by 2022, with the portion of overseas business revenue projected to rise to 75% over the next five years.
Sales revenue expanded by 8% year-on-year to 542 billion baht in 2018 from 502 billion in 2017, with a net profit of 15.5 billion.
CPF shares closed on Thursday on the Stock Exchange of Thailand at 25.75 baht, up 0.98 satang, in trade worth 560 million baht.
Source：https://www.bangkokpost.com