CRG earmarks Bt10 billion for expansion

Nath Vongpanich, president of CRG, said the group will allocate approximately Bt2 billion a year over the next five years, of which Bt500 million each will be spent on new stores and marketing campaigns, with the remaining Bt1 billion earmarked for technologies as well as mergers and acquisitions.
The company yesterday also announced the roll out of its ‘Change for Growth’ strategy, intended to increase the number of brands in its portfolio and co-investments with small operators under its ‘Let’s Succeed Together’ scheme. To maintain the leading position in the chain restaurant segment through cashing in on macro-economic advancement, CRG has recently reached a deal with a major delivery service operator in Thailand while penetration into Vietnam is imminent as part of the group’s Asean expansion. 
 Nath said the company currently operates about 900 restaurant outlets under 11 brands, comprising Mister Donut (338), KFC (243), Auntie Anne’s (151), Pepper Lunch (32), Chabuton Ramen (18), Cold Stone Creamery (20), The Terrace (15), Yoshinoya (15), Ootoya (43), Tenya (7), and Katsuya (20).
“With the latest budget, we will increase the number of new restaurants in our existing brands by no less than 60-70 outlets a year,” he said.
CRG posted Bt10.98 billion in total revenue last year while the combined net profit of all brands increased by over 15 per cent. The company expects its revenue to increase by 11 per cent to about Bt12 billion this year. 
“Our plan in 2018 is to further cement the company’s leading position in the food chain industry, supported by 11 fast food brands in the portfolio built up over the past 40 years. The goal is to raise our share in the Bt140-billion food chain segment, part of the Bt400-billion vibrant food industry, from the current 8 per cent,” said Nath.
“The biggest challenges foreseen in the next five years are the arrival of new rivals in this competitive market as well as behavioural adjustment among the new generation of consumers,” he said.
“We will overcome these by developing new brands in key restaurant segments in order to diversify risks and create new opportunities for growth. We will also develop new partnerships with individual entrepreneurs. 
We will also adjust swiftly to our new DNA by focusing on innovations amid the new consumer lifestyle, together with the development of new technologies,” said Nath.
Nath said the group’s “Change for Growth” strategy comes with three main aspects. First, new restaurant brands will be introduced through the acquisitions of new brands and franchises as well as co-investment on top of new business concepts and platforms to reach out to consumers and expand customer base in Thai and overseas markets. CRG’s investment activities will be revved up in 2018 under the “Let’s Succeed Together” scheme, whereby small and medium-sized restaurant operators or SMEs are invited for co-investments. While SMEs are vital to the economy, CRG boasts strengths and experience in raw material sourcing, marketing, personnel and know-how accumulated for over 40 years. 
Second, CRG will proceed with its overseas expansion plan, taking advantage of Central Group’s business bases in Southest Asia, Asia and Europe. Asean will be the focal point of CRG’s overseas expansion p this year, starting with Vietnam where Central Group owns retail businesses, Big C and Robins, that stand ready to support CRG’s expansion. 
Vietnam shows great potential with a population of about 90-100 million with high purchasing power. The modern trade and food industry in Vietnam remains smaller than Thailand’s but showing huge growth potential, marking an opportune time for business expansion in the country. 
Third, CRG will develop a management system and staff with new DNA to support the expansion plan. In this regard, Central Kitchen will be developed for food cost and quality control. POS System will be improved for better service quality. Business Intelligence (BI) will be deployed to categorise and analyse CRG’s data, to serve its business at all levels. Staff will be groomed to share a new DNA, encouraging employees in the Thailand 4.0 era to be daring, decisive and ready to take risks as well as warmly embrace mistakes.
Piyapong Chitchumnong, CRG senior vice president for marketing, said CRG will adjust the food concepts of all 11 restaurant brands while maintaining the strengths including food quality, tastes, variety and excellent service, to faciliate growth in the food industry that sees more and more new players. 
He added that CRG will also focus more on the food delivery service which shows a 12 to 15 per cent growth rate annually and being a trendy choice for the new generation.