PepsiCo sees further growth in Lay's snacks
text size

PepsiCo sees further growth in Lay's snacks

PepsiCo Food, a division of Pepsi-Cola Thai Trading Co and the maker of Lay's potato chips, is set to expand its snack business in line with industry growth in 2019.

Kurt Preshaw, general manager for food at Pepsi-Cola Thai Trading, said the company expects Lay's growth to outstrip the overall industry rate in the year ahead, boosted by the country's economy.

Continued investment in infrastructure projects and the upcoming general election will have a positive impact on consumer sentiment and spending power, he said.

Preshaw: Potatoes help farmers prosper

"We were satisfied with Lay's performance in 2018," Mr Preshaw said. "Sales of potato chips grew more than two times the rate of the industry [total salty snacks], and we expect 2019 to be another good growth year for Lay's snacks."

Thailand's overall snack business was worth 35.18 billion baht in 2017. The market grew by 6% in the first 10 months of 2018, outpacing many business categories.

Of the total value, the potato chips category represented about 11 billion baht. Potato chips were the highest-growing snack segment in the first 10 months of 2018, up 14.3% from the same period a year earlier, followed by fish snacks and rice cracker snacks, which posted growth of 13.1% and 5.8%.

"We expect the salty snack category to keep growing at the same rate in 2019," Mr Preshaw said. "We want to grow faster than the category to maintain our market leadership position."

He said Lay's controls 75% of the potato chip market.

In a bid to preserve growth in 2019, the company plans to continue launching new products and innovative packaging throughout the year. Brand building will proceed under the new global slogan, "Lay's: Life Needs Flavor".

According to Mr Preshaw, Lay's in the final quarter of 2018 launched five new flavours with eye-catching packaging.

In addition, the company will continue to support local farmers. The company prioritises locally grown potatoes from 3,500 farmers spanning 22,000 rai of farmland in six northern provinces and two northeastern provinces.

Each year, PepsiCo buys roughly 70,000 tonnes of potatoes from Thai farmers.

Mr Preshaw said the potato is one of the most important and high-potential food crops in the global economy apart from rice, wheat, corn and sugar cane.

"In Thailand, the potato may not be the main food among Thais, but it has been considered one of the main cash crops with a significant contribution to the billion-dollar snack food industry," he said. "It also plays a key role in the agricultural sector, as it generates stable income to more than 10,000 households of Thai farmers, with more than 1.27 billion baht worth of money circulated a year."

Boosted by the rising trend of potato chip consumption, potato growing areas have expanded in recent years.

In 2017, Thailand's potato planting area totalled 37,858 rai, of which 35,482 rai was for processed potatoes and 2,376 rai was for table potatoes.

Total production of potatoes in 2017 reached 107,103 tonnes, comprising 101,080 tonnes for processed potatoes and 6,023 tonnes for table potatoes.

"Thailand is one of the most significant markets for PepsiCo in Asia-Pacific, especially for the snack business, and we played a vital role in driving potato chip segment growth of 8.9% in 2017," Mr Preshaw said.

Do you like the content of this article?