Bonny changes focus ahead of AEC
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Bandhit Nilchiansakul, head of |the second generation of the |family that has run Bonny International for more than 40 years, |has revealed the company's strategy to promote itself as a distribution company re-exporting international brands of leather lug
However, Bandhit, who is marketing director of the company, said Thailand was lagging behind many neighbouring countries, particularly Malaysia and Singapore, which are more aware and are preparing for the Asean Economic Community (AEC), set to come into effect in 2015.
“Thailand still has a very high import duty of about 30 per cent for leather products such as luggage, as well as value-added tax at 7 per cent. This |barrier has limited local distributors |in terms of re-exporting products to neighbouring countries within Asean,” he said.
STARTING SMALL
Bandhit is the eldest son of Surachai, 62, who founded the company in 1969. Surachai is now managing director of Bonny International, which has grown from its early days as a small manufacturer of leather products – briefcases, wallets and accessories – under its Bonny brand.
Bandhit, 34, said the company had started importing branded leather products 30 years ago after being |asked by local department stores to expand its product line-up to attract more buyers.
The number of imported brands |distributed locally by the company |has increased from just six 10 years |ago to about 23 today, including |Eminent from Taiwan and Hideo Wakamatsu, a fashion brand from |Japan.
The company was the first player to have its own department for travel luggage at local department stores three decades ago, with operations at Thai Daimaru, Isetan, Central, The Mall and Robinson, he added.
“We [more recently] started looking for an opportunity to source products from abroad, such as from Italy, which has plenty of small and medium-sized manufacturers of fashion and leather goods that can make and supply products for our brand under subcontract-|ing agreements,” said the marketing director.
Bonny International has also built up goodwill and has a good relationship with distributors in markets such as Singapore, Malaysia and Vietnam, he said.
Singapore – a free-port country – is trying to promote itself as a distribution hub for international brands wishing to re-export their products to AEC countries.
Malaysia, meanwhile, has reduced the import duty on all categories of leather goods from 20-40 per cent to just 10 per cent, and has moreover done this outside of any free-trade agreements, Bandhit said.
Many local fashion brands in Malaysia have also started to upgrade by sourcing and importing products from Italy to promote a value-added “Made in Italy” image, he added.
“The prices of luxury goods in Malaysia and Singapore are about the same at this time. However, Malaysia, which is a Muslim country, can attract an increasing number of inbound tourists, especially from the Middle East,” he pointed out.
Bandhit graduated with a bachelor’s degree in business and administration |from Thammasat University’s Inter-national BBA (Bachelor of Business Administration) Pro-gramme, and has a science master’s degree in logistics and supply-chain management from Heriot-Watt University in Scotland.
“In my view, Indonesia is an interesting country for market expansion, because of its growing middle class and strong economic growth. The market is, however, quite complex in terms of state regulation and the retail system.
“Thai-branded products also have a good image in the minds of consumers in our neighbouring markets, such as Myanmar, Cambodia and Laos. There are fewer players in these markets and they have strong growth potential for the future,” he said.
Bandhit also said the company |would diversify its product portfolio |to cover lifestyle products beyond |luggage and small leather goods. |He cited lifestyle and technology |accessories, as well as sport and fashion shoes.
Bonny International will open its first lifestyle travel store – Flight 001– at Siam Discovery next month, offering luggage, innovative accessories and gadgets.
