Saha, Lazada unite for e-commerce expansion
Asean, China tipped as choice growth markets
Saha Pattana Inter-Holding Co, an investment company of Saha Group, has entered into a partnership with Lazada Thailand Co, aiming to use the e-commerce channel to explore its business at home and abroad.
Saha Group chairman Boonsithi Chokwatana said the cooperation will fully take place this year after both parties started working together in 2014 to improve their selling platforms, warehouse systems, logistics management, payment methods and customer service centres.
The companies have since signed a memorandum of understanding (MoU) enabling the Thai group to explore markets abroad, with Asean countries and China being targeted in particular.
brands from Saha Group are now available via Lazada in various categories, including health and beauty products, lingerie and sport wears. More product categories will be added, including home and living products and groceries.
Mr Boonsithi said Lazada is the leader in the Southeast Asian e-commerce market and seventh in terms of overall website popularity. It has a strong business base in Indonesia, Malaysia and other Asean market as well as China, the hometown of Alibaba, which is the parent company of Lazada.
"This will help increase opportunities for our products to expand into the Asian market, particularly China, where customers are familiar with online shopping," he said.
Lazada expanded its online business into Asean five years ago in the Philippines, Malaysia, Indonesia, Vietnam, Singapore and Thailand.
"One strong trend being seen among Thai consumers that is very positive for e-commerce is the higher penetration of mobiles," said Alessandro Piscini, chief executive of Lazada Thailand.
A lot of people access the internet for the first time through a mobile device and they are spending more time online for entertainment and various other content, he said.
"E-commerce is not just about a website, but also the sub-businesses that complete the user experience i.e. payments or logistics," said Mr Piscini, adding that Lazada will continue to invest in strengthening this ecosystem through its facilities to be put in the Eastern Economic Corridor.
Lazada offers more than 10 million items in Thailand and 100 million items across Southeast Asia. The company plans to add two to three product categories including groceries.
Saha Group has engaged in online business for a decade but sales remain sluggish, accounting for only 1% of Saha Group's total.
After partnering with Lazada, the group forecasts the sales contribution from online channels will rise to 10% in the next three years.
The 75-year old group, which is Thailand's leading consumer product conglomerate, has annual sales revenue of more than 200 billion baht from a variety of products, including food and drinks, household goods, clothes, leather goods, shoes, cosmetics and sports gear.
"The cooperation with Lazada opens a new business chapter for our group," said Mr Boonsithi.
To support the online channel, Saha Group's subsidiaries Tiger Distribution and Logistic Co yesterday signed a MoU with Paltac Corporation of Japan to strengthen its logistics businesses.
Tiger Distribution is spending 1.8 billion baht to develop Tiger Suvarnnabhumi DC Project, a large scale warehouse building in Lat Krabang, Bangkok. It is expected to open this distribution centre in June next year.