Doi Chaang Coffee Original Co looks set to beef up its business through modern retail channels this year as part of its efforts to thrive during the prolonged pandemic.
Phitsanuchai Kaewphichai, the co-founder and advisory chairman, said the company is in talks with modern retail operators to sell its premium coffee products via their retail chains this year.
At the same time, the company will resume its plan to launch new premium ready-to-drink canned coffee to the market next year after postponing the launch in 2020.
"Consumers have completely changed their coffee drinking habits due to the pandemic. Due to social distancing lifestyle, customers have shifted to drinking coffee at home more than outside," he said.
"Consuming coffee at home has become more familiar and the continued work-from-home policy by many organisations is likely to help sustain coffee consumption at home although the Covid-19 situation is more relaxed," Mr Phitsanuchai said.
He said competition in the premium ready-to-drink canned coffee market is still relatively low compared with the mass market.
"Our premium brand recognition among customers makes us confident more opportunities are available," Mr Phitsanuchai said.
The company predicts continued sales growth via all modern trade chains from Makro, MaxValu, Villa, Tops and Foodland supermarket. It will start selling coffee at the CJ chain this month.
Prior to the Covid-19 crisis, around 80% of Doi Chaang's sales came from green bean supplies to export markets and roasted coffee for HoReCa (hotel, restaurant and catering) and coffee shops, and the remaining 20% was from the retail channel.
"Our 80% sales all went because of the pandemic. We've gradually adjusted operations to sell more products via retail channels during 2020-21. This year, we are ready to become more aggressive to expand our business via retail channels both online and offline, expecting sales via the retail channel to contribute 80% of total sales this year while the remaining 20% is from the cafe business," Mr Phitsanuchai said.
He said the opportunity to expand the HoReCa channel remains tough at present as the tourism business is yet to turn around.
Nonetheless, he said the company has seen better signs of sales for its cafe via a franchise system. Almost 100% of Doi Chaang cafes have resumed operations.
"Although consumer purchasing power remains fragile, we believe there is still demand for coffee in Thailand," he said. To lure more investors for Doi Chaang franchises, it will continue to waive its monthly royalty fee for every six months and reduce the entrance fee by 50% to 150,000 baht until the Covid-19 situation improves.
The firm expects to open 10 new Doi Chaang outlets via franchise this year. It expects sales of Doi Chaang will be back to the pre-crisis level next year.