Patum Rice Mill and Granary Plc, a leading rice exporter and packed rice distributor, is looking at becoming a full-scale distribution business in an effort to reduce the risk of relying mainly on rice.
Tsurumaru udon restaurant at MBK Center has enjoyed brisk business since opening.
After distributing only its Mahboonkrong packed rice for decades, the company made a trial run of distributing Ichitan ready-to-drink green tea as the first outside product in recent years.
''The expansion to distribute more outside products will utilise our distribution capability, increase cost efficiency and, more importantly, balance the risk of relying mainly on rice products,'' said managing director Somkiat Makcayathorn.
The new distribution business will boost sales amid the uncertainty of selling packed rice, which is facing a hard time caused by the government's ailing rice-pledging scheme.
The company plans to import innovative Japanese products because Thai consumers hold Japanese products in high regard in terms of innovation and quality.
It will find more local products from outsiders to sell within its own distribution channels.
Apart from importing products to sell here, it plans to extend its own product lines to other categories by forming ventures with strategic partners.
"We aim to see the distribution business contribute 10-20% of total sales over the next three years," said Mr Somkiat.
During the current political situation, the company has suspended its plan to develop its own rice snack line because of fierce competition in the snacks market.
For its core rice business, Mr Somkiat said the company will explore the potential for its Mahboonkrong packed rice in Asean countries ahead of the formation of the Asean Economic Community late next year.
"We'll look at the tariffs for packed rice in Asean to see whether they will benefit us, as rice remains a sensitive item for each country in this region. But there are opportunities for Thai Hom Mali packed rice," Mr Somkiat said.
Laos, Singapore and Malaysia are in its business pipeline. The company plans to appoint local distribution firms in these countries to market Mahboonkrong-brand Hom Mali packed rice.
Currently, the company exports its packed rice to Dubai and Australia. Rice exports account for 5% of total sales so far. With aggressive marketing, it expects the export sales of its packed rice to rise to 15-20%.
Mr Somkiat said the competition in the Thai white rice market will be more intense, push prices even lower.
Excluding rice snacks, the company will continue expanding into other rice-related businesses. It recently opened its first Tsurumaru udon restaurant and Fujio, a self-service restaurant at MBK Center.
The response to Tsurumaru udon has been quite good with 2 million baht in sales only 20 days after opening. The company plans to open a second branch next month at Seacon Square on Srinakarin Road. It intends to have 10 udon restaurants within the next three years.
Mr Somkiat expects sales this year to grow by 15-20% from 2.5 billion baht last year.