Distribution arm of Thailand Post on rise

Distribution arm of Thailand Post on rise

Workers doing the rounds at a warehouse of Thailand Post Distribution Co.
Workers doing the rounds at a warehouse of Thailand Post Distribution Co.

Thailand Post is confident that its logistics business unit will turn its first profit in 2017 after three years of operations.

"We expect our logistics revenue to reach 480 million baht this year, an increase of 60% from 300 million in 2015," said Warakan Srinualnad, chief executive of Thailand Post Distribution, the logistics arm of Thailand Post.

"We also expect to break even this year, after facing a loss of 100 million baht last year, thanks to our cost-effectiveness strategy," he said.

Thailand's logistics market has experienced an average annual growth rate of 15% per year.

Established in 2014 with registered capital of 350 million baht, Thailand Post Distribution last year began its logistics operations, mainly serving the medical and pharmaceutical industries, e-commerce and warehouse management.

Its logistics activities in the medical and pharmaceutical industries generated 270 million baht last year, or 90% of its total logistics revenue. E-commerce generated 15 million baht, with warehouse management accounting for the rest.

Mr Warakan said Thailand Post Distribution expects revenue from its e-commerce service to surge to 58 million baht this year, as that market is booming.

The company projects revenue from its medical and pharmaceutical services to account for 80% (384 million baht) of the total this year. E-commerce is set to account for 12% and its warehouse management service is set to generate 8%.

Thailand's medical and pharmaceutical industries are estimated to have a combined annual value of 1.5 trillion baht. Logistics services for these industries, in turn, are expected to be worth 15 billion baht annually.

Mr Warakan said Thailand Post Distribution is one of the leading distributors of medical and pharmaceutical products in Thailand.

The company provided logistics outsourcing services to major state health and pharmaceutical agencies such as the Government Pharmaceutical Organisation and the National Health Security Office.

Thailand Post Distribution rents a warehouse facility on Bang Na Road, which is owned by WHA Corporation, a major built-to-suit warehouse and distribution developer.

Thailand Post Distribution has nine of its own storage and distribution facilities in major provinces.

Mr Warakan added that Thailand Post Distribution has received ISO 9001:2015 certification for its service quality standards, and also conforms with ISO 14001:2015, which sets out the requirements for achieving an environmental management standard.

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