SET-listed Oishi Group, a food and drink company owned by billionaire Charoen Sirivadhanabhakdi, plans to increase investment by 25% to 1 billion baht next year to retain market leadership.
Nongnuch Buranasetkul, the group's president and chief executive, said that about 50% of the investment will go towards expanding restaurants, with the balance to be used for the drinks unit, mainly to overhaul the ready-to-drink green tea factory at Navanakorn Industrial Estate in Pathum Thani. The factory caught fire late last year.
"We are set to aggressively expand our food and beverage businesses in Asean markets, including Thailand, with a significant number of new product innovations being introduced to accommodate the demands of consumers across unique lifestyles and five megatrends," Mrs Nongnuch said.
The five megatrends are rapid urbanisation, a growing middle class, tech-dependent lifestyles, healthy eating and the ageing society.
Mrs Nongnuch said that with cities becoming increasingly urbanised, consumers are veering towards lifestyles that prioritise speed and convenience.
"Asean is a large market comprising a population of well over 600 million," Mrs Nongnuch said. "We must capitalise on the Asean potential to the fullest extent possible.
"Our goal is to drive the Oishi Group aggressively for the realisation of Vision 2020. As such, our strategy is to focus on innovation, extend our reach into Asean and develop our human resources and capitalise on their potential, based on continuous workflow improvement."
Oishi reported that revenue from sales and services for fiscal 2018, which ended Sept 30, totalled 12.59 billion, down 7% from 13.55 billion in fiscal 2017.
The drop was largely due to a decrease in drinks revenue, which fell by 15.1%. Food revenue increased by 1.7%.
Net profit fell 30.1% to 1.01 billion baht in fiscal 2018 from 1.44 billion baht in the previous year.
Jesdakorn Ghosh, the company's executive vice-president for the beverage business group, said the company is determined to maintain market leadership in the green tea drinks business in 2019.
To achieve this goal, the company will continue to roll out new product innovations that correspond to the changing lifestyles of consumers and initiate campaigns that accommodate their needs.
"The healthy premium products group has become our focus, mainly due to rising demand for health-conscious products," Mrs Ghosh said.
The company aims to roll out customised products that correspond to local market preferences to make the Oishi brand the No.1 selection choice in each overseas market and to take the brand to the regional level.
"This year was extremely challenging for the green tea business, primarily due to an increase in excise tax, the weak purchasing power of customers and the tepid ready-to-drink green tea sector," Mrs Ghosh said. "We expect the green tea market to be reshaped next year by the general election, which is expected to boost consumer confidence."
Thailand's ready-to-drink green tea market was valued at 15 billion baht in 2017, with the figures forecast to drop to 13 billion baht this year.
Oishi controls 45.4% of Thailand's ready-to-drink green tea market.
Paisarn Aowsathaporn, the company's executive vice-president for the food business group, said the business strategy of Oishi restaurants in 2019 remains unchanged.
"We will maintain our 'King of Japanese Food' leadership position in this market continuously and sustainably, with three fundamental plans," Mr Paisarn said.
The plans include driving organic growth, focusing on the creation of value-added products and services to achieve sustainable growth. Oishi plans to drive operational excellence by focusing on work process improvement to achieve increased efficiency and customer satisfaction.
The company plans to open 19 new restaurants nationwide next year to reach a new customer base.
"We will grow our business through a smaller-sized restaurant model that allows us to open more outlets in peripheral provinces," Mr Paisarn said.
He said the Oishi food business group in 2018 is expected to achieve all projected objectives under its strategic plan.
"We've rebranded the look of our restaurants to become more youth-centric, rolled out new products driven by innovation, and strengthened our product delivery and service quality," Mr Paisarn said.
The company opened 15 new restaurants in 2018. Of the total, 11 restaurants are Shabushi shabu and four are under the Eaterium brand.
Mekhala Nethipo, the company's executive vice-president for packaged food business, said a major restructuring and rebranding of the packaged food business is ahead in 2019.
"Over the past couple of years, the packaged food market segment has become increasingly an integral part of people's lives in urban areas," she said. "This development presents opportunities and challenges for both the ready-to-eat and ready-to-cook businesses. We will rebrand the Oishi packaged food image this year to increase public brand awareness."
The company will change the packaging of Oishi packaged foods, consolidating all group brands into one single brand.
"Brand uniformity will make sales and distribution of products more flexible through synergy with the whole group," Ms Mekhala said.