Tanachira Retail Corporation Co, the distributor of Pandora jewellery in Thailand, is spending 1 billion baht to acquire a popular Thai health and beauty brand as part of a strategy to form its own brand.
Tanapong Chirapanidchakul, the company's chief executive, said it completed the acquisition yesterday, with further details to be unveiled later this month.
The unnamed health and beauty brand is Tanachira Retail's second brand acquisition, following the Cath Kidston fashion brand in Thailand last year.
The new health and beauty brand has sales of 350 million baht a year and exports to 16 countries, mainly in Asia, he said.
"It is necessary for us to have our own brands to enable us to expand our business without any conditions, and this will empower us to expand our business regionally," Mr Tanapong said.
With the new health and beauty brand under its umbrella, Tanachira Retail plans to increase retail stores by almost 50% to 110 stores across the country.
"We aim to gain 50% of income from our new own brand. Over 90% of income stems from international brands that were awarded the right to market in the country," Mr Tanapong said.
Tanachira started distributing lifestyle and fashion products in 2010. There are three brands under its portfolio -- Pandora, a jewellery brand from Denmark, Finnish home furnishings, textiles, and fashion brand Marimekko, and British fashion accessories brand Cath Kidston. The company also owns and operates its own diamond jewellery brand called Tilda.
Pandora is its flagship product, contributing 65% of the company's total sales estimated at 1.2 billion baht this year. The remaining 25% of sales is from Cath Kidston and 10% is generated by Marimekko and Tilda.
Mr Tanapong said Pandora's early years in Thailand were focused primarily on building brand awareness among Thai women.
Over the past eight years, the brand has witnessed increasingly favourable market response he said.
"Thailand is one of Pandora's top sales markets in Asia-Pacific. The brand has consistently enjoyed double-digit sales growth on a yearly basis since its first year in Thailand," he said.
Growing Pandora's sales will help drive the overall sales of Tanachira Retail to increase 27% to 1.2 billion baht by the end of this year, said Mr Tanapong.
With the latest acquisition, the company estimates sales will reach 1.85 billion baht next year.
Apart from the new acquisition, the company has spent about 110 million baht to expand business this year, he said.
Of the total, about 50 million baht was allocated to marketing, while the remaining 60 million baht was spent to open 8-9 new retail stores and renovate existing stores.