Tuesday, August 04, 2020

Cost cutting, new markets key strategies for food and marketing company hit hard by Covid-19 crisis

Mar 04. 2020
Itthipat Peeradechapan
Itthipat Peeradechapan
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By THE NATION

Taokaenoi Food & Marketing, a company that relies heavily on China’s huge market, revealed that it has adapted itself in several ways to cope with the Covid-19 crisis so as to shore up its revenue.

The company said 40 per cent of its market is in mainland China and the virus situation had severely impacted its sales.

Chief executive officer Itthipat Peeradechapan said that the Covid-19 was no the first crisis Taokaenoi had faced.

He said the outbreak in China had affected the purchasing and export of products. “The situation has started to improve since the past two weeks. However, the products sent to China this time were just essentials for people’s lives,” he added.

Taokaenoi’s sales in Thailand also have dropped sharply as its products mainly targeted Chinese tourists, and others from Japan or South Korea.

The decrease in the number of tourists this time has led to the company closing more than 10 branches of Tao Kae Noi Land shop.

The CEO said the company’s two factories will be merged in the first half of 2020. “Total productivity this year would be 67 per cent, while the cost would be reduced by around 10 to 15 per cent,” he added.

In addition, Taokaenoi will focus on marketing to domestic customers through new product development, especially those in healthy trends and premium ones.

The CEO said the company has cut Bt100 million of marketing cost of sponsoring and event organising to salvage the company’s profit.

Taokaenoi is also making crispy seaweed products targeting the US market as Original Equipment Manufacturing.

Itthipat expected the company’s sales to be stable at Bt5.3 billion. In 2019, its sales were Bt5.267 billion, down 3 per cent over 2018.

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