Eye on the ball

Eye on the ball

Heir to the FBT business sees a sporting chance to build the company's brand and expand beyond Asean.

Monchai Chokephaibulkit's office is filled with balls --footballs, basketballs, rugby balls, volleyballs and more. And when he looks out of his big window, he can see Hua Mark National Stadium opposite the headquarters of the 63-year-old company that supplies sporting equipment and apparel to customers all across Southeast Asia and beyond.

"That's why I don't spend my spare time watching football anymore," says the 44-year-old heir to the family business, laughing. "Maybe it's the same thing if you sell chicken rice -- chicken is not something you really want when you have spare time."

Although he's the deputy managing director of Football Thai Factory Sporting Goods Co Ltd (FBT), Mr Monchai admits that he's not a big sports enthusiast or fan of any team in particular. "But I follow the news and I know what's going on," he says. "I used to play badminton and squash but I've backed down as I got older. For team sports, such as football and basketball. I don't have much time to gather a team."

Growing up in a Chinese-Thai family, Mr Monchai has been involved in the business in one way or another since he was 10 years old. He started working part-time at the company when he studied at Assumption University (Abac) at the age of 16. The fifth of six children, he was sent to the UK for school at age 8 and came back every summer.

"We learned English ever since we were young. Whenever my father travelled to Taiwan or other countries, he took me on the trip with him and I acted like a translator. Having migrated from China directly, education was not something he had the privilege of getting," he recalled.

While his sisters worked in the back office in accounting, finance and administration, Mr Monchai's first role at the company was as general manager in charge of production. He oversaw the building of the FBT Sport Complex on Ramkhamhaeng Road, which is its current headquarters. Later he took over marketing and sales for both domestic and overseas markets.

Today, the company employs 2,800 people including those at the manufacturing plant in Nong Chok and its sporting goods store at the Hua Mark headquarters. Located on 72 rai, the factory produces and markets all kinds of equipment and sportswear, some of which is sourced from China or Europe.

It could be argued that FBT products are seen by more people worldwide than anything else made in Thailand, since its balls are widely used in international competitions and certified by global sports bodies including Fifa for football and the FIVB for volleyball.

"We have to study various aspects of sport in order to know how to produce and sell sports equipment," said Mr Monchai. "People always ask why we don't set up a football team but I think that what we do is different area of sport. Management of a team requires a different set of skills," he told Asia Focus.

His father, Kamol Chokephaibulkit, started the business in 1950 by sewing footballs in a temple, learning the craft by repairing footballs that European expats brought him. Two years later he formally established Football Thai. Now 84, Mr Kamol is still the president and sole owner of FBT.

"We gave Thai people the chance to play with leather balls instead of coconut ones," Mr Kamol once told an interviewer.

"He's still very active," Mr Monchai said. "We have learned many things from the previous generation. The most important things are to never compromise on quality, our word is our bond, and to always keeps our brand and products at the highest standard."

Apart from its own line of balls, racquets, apparel and boxing gear, the company also produces sporting goods for other brands under original equipment manufacturing (OEM) contracts. Its biggest customer at the moment is the Japanese brand Mikasa, and it also produces a lot for Mizuno.

REGIONAL PRESENCE

FBT began to expand to other markets in Asean 32 years ago, starting with Singapore. It now has a presence in nine out of 10 Asean countries with Indonesia being the exception.

"Singapore was the first country, followed by Malaysia. In the Philippines, we have been doling business for just over 10 years," said Mr Monchai. "We entered Brunei in 2001 when the country hosted the SEA Games for the first time. We went there and sold the products ourselves. For Laos, Cambodia, Myanmar and Vietnam, we've been there for seven years.

"Normally, we use the SEA Games as a vehicle to get into each Asean market in an impactful way. Prior to that, we appointed agents to represent our products in the market.

"Through the SEA Games, we have gained exposure in 10 Asean nations, and in the past we had enough contacts with agents and were able to sell our products without much effort. Now it's become much more difficult to expand the business with more competitors entering the market, and because we are not there all the time, the agents' support is not as good as it should be."

Indonesia has been a headache for FBT because a local company there registered FBT as its own brand before the Thai company considered entering the market. It's not the first time a foreign brand has been poached in this way.

"In Indonesia, the law is like Islamic law, in that if an Islamic company has registered your brand it doesn't matter whether they've copied your brand," he said, adding that Nike and Mikasa had to buy back their brands which were registered by local firms and it cost the latter US$3 million

"Such a policy is not friendly to foreign companies. Thai law, on the other hand, is very good in this regard. If anyone, intentionally or not, registers your brand, they have to give it up," Mr Monchai said, citing a case in which US-based Coffee Bean & Tea Leaf filed a lawsuit against the Thai company, prompting the latter to change its name to Coffee Bean by Dao.

"That is not the case in Indonesia where as long as you are a local company and you registered the brand, they will make sure that the government protects it. They don't care what international law says."

FBT sought help in this case from the Thai embassy in Jakarta 25 years ago but found out that it couldn't do anything.

"Our hope is that with the arrival of the AEC (Asean Economic Community) at end of this year, pressure will be applied on Indonesia by the international community, through lawyers and foreign chambers, for this law and others that are being applied in Indonesia to be changed. To be honest, if we have to spend $4-5 million to buy back the brand, it's not worth it. We don't have enough to just buy back and then restart the brand in Indonesia again."

Despite the setback in Indonesia, FBT is one of the leading brands of its kind in Asean with little competition.

"Wherever we go, we get positive feedback," said Mr Monchai. "People in Asean embrace our brand as their own. Not counting those from Japan, we are one of the most well-accepted brands. Even in Singapore and Malaysia, which are countries in an advanced stage of branding together with Thailand, they don't have a brand that has reached out to other countries the way ours has."

While FBT is putting more effort into expanding sales in Southeast Asia, this doesn't mean the Thai market isn't growing anymore. "For sports, the Thai market is still growing a lot and Thailand is still our priority. We must think ahead and be proactive," he said.

"Sport is like a semi-luxury product because it's not a necessity and not exactly a luxury, but somewhere in between. For people whose quality of life is more middle class, they look at sport as a way to improve their way of living, and that's the market that we're in."

BEYOND ASEAN

FBT recently signed a sponsorship agreement with the Football League Trust, the CSR (corporate social responsibility) arm of the Football League in Britain. The league controls the 72 teams below the Premier League, in the Championship, League 1 and League 2. Each team has a fund that is used for youth programmes and teaching the game.

"The Football League Trust manages these funds donated from various teams. Although it's not a big amount of money, the sponsorship is a way for us to enter the football market in the UK and have a connection with those 72 league teams," said Mr Monchai. "The Football League Trust also sponsors kids to go to the camps and become players in the lower leagues. So it's a good starting point for kids to know about our brand and get acquainted with the quality."

Football in the UK is a huge business but the Premier League is too big for FBT to get into; only huge international sporting-goods players such as Nike and Adidas have the resources to get into sponsorship at the highest level. Given FBT's more limited resources, Mr Monchai said the company needed to find its niche.

The company has set up UK-based FBT Europe, a 50:50 joint venture with a local partner, to build the business in Europe. It also aims to expand to Australia where football, cricket and Australian Rules Football are the most popular sports.

"We are looking at various teams (in Australia) to sponsor. It has been going at a slower rate but if we find the people who are interested in working with us, why not? Soccer is not big there but Australia as a nation is very passionate about sport," noted Mr Monchai.

"And if we have Australia, we can expand to New Zealand easily with the same approach as in the UK but slower. We don't need to spend too much in this market but we try to have people in place there to look for teams we can approach.

"Now we have a local basketball team in Australia that buys and wears our products, so we can give them a better price. They're happy with the product. We have the advantage of low cost because we manufacture the products ourselves with our own production facility, and we offer flexibility and customisation, so we can design specifically for their team.

"Our aim is to make our brand more international. Instead of doing nothing, we put a bit here and there and see how it grows," he said. "Of course, Thailand is our focus and Southeast Asia is the next move. We want to be a regional brand but at the same time, if we have a presence in markets like the UK and Australia, it would help us when we want to try going into markets like Japan, Korea or even China in the future."

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