Health snack maker banking on modern trade outlets

General manager Setthakarl Settaphakorn told The Nation in an interview this week that the distribution-channel expansion would largely be in the modern-trade segment of the market, especially via sales at 7-11 convenience stores.
Mayanakarn currently distributes its snack foods to Tops supermarkets, The Mall stores, UFM and 100 traditional trade outlets nationwide.
“If our distribution via 7-11 is successful, we target overall sales of Bt100 million in 2016,” he said.
Setthakarl, 40, decided to resign from his position as head of marketing at Swarovski (Thailand) last year in order to run his own business.
He initially planned to import products from China for distribution in Thailand, but had to change tack after the Chinese supplier altered its business policy, suspending the deal.
“After failing to secure products from the Chinese firm, we [Setthakarl and his wife] decided to do business by ourselves by researching and developing what we could produce and sell to match customer demand. This approach was based on the experience gained from working in marketing at Swarovski (Thailand),” he said.
Pananya Thitibordin, managing director of Mayanakarn, said that through her family’s ownership of the Homemade by Tamu restaurant, she could see there was rising demand for health food in Thailand, so she advised her husband to go into the business of producing health food for general consumption.
They then spent 18 months, through to June this year, researching and developing which food to produce, deciding during this process to focus on dried mushroom, because the company has the local resources to grow the vegetable, as well as the technology to produce quality dried mushroom.
Setthakarl and Pananya spent their savings and some money from their family on building a Bt10- plant for the production of dried mushroom snacks under the HuaHed brand, which was launched in August.
In the very first month, the company recorded sales of about Bt500,000, and then double that amount the following month.
“When our sales doubled immediately, we were confident that our products matched what consumers were demanding, and so we expanded our distribution channels from traditional trade to modern trade the following month,” Setthakarl explained.
Sales now average Bt1 million a month, but will grow as the number of distribution outlets has been doubled to 200 this month.
The company plans to increase its distribution outlets to around 1,000 next year, which should enable it to achieve annual sales of Bt100 million, he said.
“We target showing a net profit within two-and-a-half years,” he added.
The key to our success is making food products that meet demand amid the rising trend of health consciousness, and this presents a business opportunity for the long term, said the general manager.