Malee to get a Filipino twist
MALEE Sampran (Malee), the leading juice and canned fruit brand in Thailand, yesterday announced an aggressive move into the international beverage market by establishing a joint venture with Monde Nissin Corporation of the Philippines.
The new joint venture company, Monde Malee Beverage Corporation (MMBC), will have 100 million pesos (Bt77.61 million) in paid-up capital. Both Malee and Monde Nissin will hold 49 per cent in the joint venture and the remainder will be owned by individual investors.
In its first move into the Asean market, Malee believes the joint venture will allow it to expand its business and product line to target Filipino consumers.
Under the joint venture, Malee Sampran will be responsible for product development and manufacturing, which are its key strengths, while Monde Nissin will handle marketing, sales, distribution and logistics in the Philippines.
Panya Chutisiriwong, senior vice president of investor relations at Malee Sampran, said the joint venture with Monde Nissin is in line with the company’s expansion strategy to penetrate the international markets, especially those in Asean.
“We expect our export contribution to increase substantially from 25 per cent to about 50 per cent of our annual sales revenue in the next three to five years,” he said.
Panya said Malee Sampran posted Bt4.74 billion in total sales last year, and it expects to reach approximately Bt5 billion this year. Of that, about 25 per cent of sales will be from exports to about 30 different markets around the world, either through its Malee brand or OEM (original equipment manufacturing).
“We expect our annual sales to reach about Bt10 billion in the next three to five years, of which half will be from international markets,” said Panya.
The MMBC joint venture is Malee Sampran’s first in Asean and it is set to capture the growth of the beverage market in the Philippines. This joint venture will manage new product development and marketing of all beverage products for the Philippines market, with Malee as the exclusive manufacturer and Monde Nissin as the exclusive distributor.
Chatchai Boonyarat, CEO and chairman of Malee Sampran, said the Philippines has a population of 100 million people, the second largest population in Asean after Indonesia.
He said the beverage market in the Philippines shows strong growth for years to come. Both the economy and the GDP (gross domestic product) are improving continuously in accordance with the increased purchasing power of consumers as the number of middle income population rises steadily.
The Philippines beverage market, excluding alcoholic beverages, is worth around Bt200 billion, with average annual growth of 8 per cent and is likely to grow even higher. The beverage market in the Philippines is still in its infancy, with less variety of products and less product sophistication compared with the Thai market. But this new market is very attractive and has high growth potential.
“The Philippines consists of more than 7,000 islands. So, one of the key success factors in this market is a strong logistics network with comprehensive distribution around the country. These are the clear strengths of our joint venture partner Monde Nissin Corporation,” said Chatchai.
Henry Soesanto, executive vice president of Monde Nissin, said the joint venture will provide the two companies with additional strength. Malee has experience and expertise in the beverage business, with competitive advantages in new product development with its innovation centre, along with the capability of manufacturing high-quality products with advanced production equipment. Monde Nissin has a deep understanding of the needs of Filipino consumers, along with strengths in marketing, brand building and distribution across the channels throughout the Philippines.
Monde Nissin is recognised as having one of the widest distribution networks in the industry with the ability to reach and service the biggest modern trade account to the smallest traditional channel. The complementary expertise of the two companies will contribute to the smooth operation and success of the joint venture.
MMBC aims to launch its first new product in the Philippines in early 2016 with a strong product pipeline play to continuously stimulate the market. These new beverages will help Monde Nissin expand the company’s product portfolio, which is a category that has the highest potential.
Chatchai hope the establishment of this joint venture business will help drive Malee’s sales and allow its branded international business to grow by at least 50 per cent by next year. Malee wants overall sales in the Philippines market to be equivalent to the company’s sales in the domestic Thai market by 2020.