Saha to set up two major operations in Myanmar

“We have had our sole agents in both Myanmar and Vietnam for more than 10 years and they are in charge of distributing the group’s products in their own markets,” Boonchai Chokwatana, president of Sahapathanapibul, the manufacturing and trading arm of Saha Group, said yesterday.
“Myanmar is an emerging market with strong potential, thanks to its 61 million population, which is quite similar to Thailand’s. The country is just opening up with cheap labour costs,” he said.
One distribution centre in Myanmar would be for Sahapathanapibul’s consumer goods and the other for ICC International’s fashion and cosmetics products.
Saha Group has said it would develop an industrial park as well as expand its energy business in Myanmar. The aim is to cash in on the opening of Myanmar and the government’s deregulation policy, which welcomes businesses from around the world to invest in the country.
Sahapathanapibul expects its sales in Thailand to grow by 15 per cent this year to about Bt30 billion.
The set-up of Sahapathanapibul’s logistics and distribution operations in Myanmar would be through a joint venture with a local investor in the country.
Besides its own products, the company will also provide logistics and distribution services for products belonging to outside vendors.
The Asean Economic Community, which will be fully effective in 2015, would have a significant impact on local trading companies, which will face more intense competition, especially from newcomers, which will penetrate the market and take advantage of the open market environment.
“As an existing player, we need to adjust to become more competitive and able to take on international rivals,” Boonchai said.
Trade liberalisation in the wake of the AEC’s development however would benefit Sahapathanapibul and other local trading companies as they would see more international clients seeking local companies to handle their products.
“At Sahapathanapibul, we have a strong distribution network, which covers both the traditional and modern trades. We have the most ready distribution structure in the country.
“What we have to do from now is to bring new advanced technologies to make our logistics management more efficient, such as sales data and its analysis,” he said.

400 TRUCKS
 The company has more than 400 trucks in its fleet.
“We expect to increase the ratio of products owned by outside vendors in our trading revenues from currently 10 per cent up to 20 per cent when the AEC is fully effective. Most of our business however is still from distributing Saha Group’s own products,” he said.
Sahapathanapibul would open another distribution centre on Romklao Road in Bangkok at a cost of Bt200 million. Its main distribution centre is presently in Chon Buri’s Sri Racha district.
“What we are highly concerned about is the labour problem. The government’s minimum wage scheme laid a higher cost burden on the local industry, which will make Thailand lose its competitiveness in the long term.
“Saha Group alone has to carry Bt1.5 billion in higher labour expenses every year as a result of the new Bt300 minimum wage,” he added.