Heady brew of profits follows business recovery

Sixteen years later, with the debt long paid back, the business is generating sales of more than Bt60 million a year and its success is benefiting farmers in the Chiang Mai area.
“My father, Teera Taksaudom, established the more than 50 years ago to support farmers in Chiang Mai moving to grow coffee beans under an opium-substitution programme,” Naruemon, who is managing director of Hill Koff Co Ltd, said in an interview with The Nation recently. 
“But in 2001, the coffee price dropped to only Bt20 per kilogram and all the coffee production plants stopped buying coffee from my father’s company, leaving it to shoulder debts of up to Bt20 million.”
Naruemon said that, with her father facing a financial crisis, she decided to resign from her job as a lecturer in the business faculty at Payap University and attempt a recovery in the business.
Naruemon said she went to Bangkok seeking out coffee shops that might be interested in buying the company’s coffee. She also learnt that coffee prices at the retail level were more than double those in the wholesale market.
“I started to package our coffee, with up to 100 tonnes for sale, and also started to use a brand name, Hill Koff, for my products. This was part of efforts to transform the business with the benefit of what I learnt from my studies for a master’s degree in business,” Naruemon said.
She achieved success in selling up all the stock of coffee that her father had been unable to sell, and went to clear the debts within five years.
She also expanded her father’s business by increasing the number of buyers for the coffee grown in Chiang Mai to also include Arabica coffee beans grown in the neighbouring provinces of Chiang Rai, Phare and Nan. The business also takes in Arabica coffee grown in Northeastern provinces such as Loei. These stocks are packaged under the Hill Koff brand.
In the 17 years to last year, the company bought an average of 100 tonnes a year. But now the company is buying at the rate of an average of 600 tonnes a year from farmers, translating into the Bt60 million in sales last year. The company expects sale growth to average 20 per cent a year. 
Naruemon has carried out research and development aimed at producing coffee by-products under the concept of a zero-waste plant, such as tea from coffee leaf, among other products. 
The company has three shops to present its products under the Hill Koff brand, including a factory outlet that also showcases its coffee tea product. The factory outlet also gives visitors an insight into the research and development that leads to the new products in addition to a learning space for coffee lovers and for those who want to learn how to get into business. 
This year the firm will open an outlet for consumers under the concept of a coffee restaurant. The outlet, called Hom Glai, will offer coffee as beverages and in food items. The first Hom Glai branch will open in Chiang Mai, with scores more planned nationwide within five years.
To back the business expansion, the company has invested Bt30 million to expand its production capacity from 600 tonnes to 1, 000 tonnes. The upgrade begins this year and is due to be completed in 2019.
“We decided to expand our production capacity to cater to the strong demand in the market,” Naruemon said. “This not only for the Thai market, but will also cover overseas sales with exports to Malaysia, the US, France, Taiwan, and South Korea.”
She said the key to the company’s success is its research and development that has led to products to match the demands of customers.
 The company has learned how to develop its products and also how to benefit the farmers that supply it, involving more than 60 communities in Chiang Mai. With the success achieved so far, Naruemon expects the business to maintain growth at an average of 20 per cent a year. Such a pace will push sales to Bt100 million within five years, she said.