Ubon trucking company rose from ashes of 1997 crisis
FROM THREE TRUCKS in 1997, Ban Paew Group Limited Partnership now has 100 trucks to handle logistics in the Northeast and also plans to expand into neighbouring countries when the Asean Economic Community takes effect at the end of this year.
“We started our business when the country faced the financial crisis in 1997, when I had to resign from my job at CP Group,” the group’s managing director Sakarin Nutipun said in an interview with The Nation.
He said that after leaving Charoen Pokphand Group, he returned home to help his father in his business of distributing agricultural products from farms to retailers. At that time the business had three trucks.
“I saw a business opportunity at a time when most corporates were facing a hard period of restructuring their debts. I expanded my father’s business from distributing agricultural products to consumer products by negotiating with [goods manufacturers], and I also found retailers who needed the products to sell,” Sakarin said.
Initially, the company distributed consumer products to traditional retailers in Ubon Ratchathani province, then expanded to neighbouring provinces including Yasothon, Amnat Charoen and Si Sa Ket. Over time, Sakarin built up his three-truck fleet to 100 trucks, supplying 10,000 shops, up from 200 shops 10 years ago.
The business now also has a distribution centre and an agency for the distribution of several consumer products such as food and milk.
At present, the group has three limited partnerships – Ban Paew Group, Ban Paew Distribution and Thai Global Milk.
The group generates annual revenue of Bt500 million, 30 per cent from its logistics service, 40 per cent from its distribution agency, and 30 per cent from the distribution centre. This compares with revenue of Bt10.8 million 18 years ago.
“Our business has recorded average growth of 20 per cent a year since 1998,” he said.
The group plans to establish a fourth company this year as a warehouse business to support its expansion into Laos and Cambodia.
“The key to our success was doing business in a period when other firms were facing the [financial] crisis, while we also developed our service to meet our customers’ demand,” he said.
“Although now the logistics service and distribution centre face high competition from modern-trade businesses, we can offer better value to our traditional-shop customers than our competitors can. This has driven our business growth to an annual average of 20 per cent.”
