TMB to manage supply of Boon Rawd dealers

Piti Tantakasem, chief wholesale banking officer at TMB, said the bank has been providing Boon Rawd with supply chain management for the past eight years because of the company’s comprehensive upstream and downstream cash flow.
Piti said the bank started managing the financial supply chains of Boon Rawd’s 200 exclusive dealers nationwide after seeing the high cost of them transferring money to Boon Rawd.
After helping them save on this cost, he said the next step was to offer a credit line with a special interest rate to dealers who required working capital for ordering inventory products off Boon Rawd.
He said that around 70 per cent of the dealers used the credit line, which helped them have sufficient cash flow, while they did not become non-performing loans because they had been screened by Boon Rawd.
Supply chain management was a win-win situation, with the service being expanded to the brewery’s 12,000 sub-dealers, he said, adding that unlike the dealers, the sub-dealers could distribute several brands.
“We are developing a synergy fleet credit card for dealers and sub-dealers for filling up with fuel due to fuel being a cost for those businesses,” he added.
“The synergy card will increase the purchasing power of dealers and sub-dealers because the volume of fuel required by dealers and sub-dealers is big enough for fuel stations.”
Chutinant Bhirombhakdi, executive vice president of Boon Rawd, said that the company had placed importance on supply chain management for many years because it supported the stable growth of the company and its stakeholders.
Thailand is not a large economy so an organisation grows when its stakeholders grow, he said.
If Boon Rawd’s suppliers, dealers and sub-dealers are unable to grow, the brewery will have limited growth as well, he said.
The dealers and sub-dealers contribute 60-70 per cent to Boon Rawd’s total sales revenue, and have a cash conversion cycle of around 30 per cent of Boon Rawd’s Bt160 billion to 180 billion in sales revenue.
“Operational cost reduction is a key factor for doing business at present,” Chutinant said. “Business operators finally will witness competition challenges from the increase of raw material prices, while the producers cannot push their sales in line with the cost of raw material.
“As a result, margins have steadily narrowed. Therefore, supply chain management is the proper solution.”