How a shift in focus turned the Covid-19 crisis into a big opportunity for Asian Group
The company has recently announced that it will list its pet food and tuna products manufacturing subsidiary Asian Alliance International in the stock exchange by the end of next year.
Though economies across the world have been hit adversely by the Covid-19 pandemic, Asian Group has been one of the few companies to report outstanding operating results.
The Asian Group, which started as a family business more than 40 years ago, is now a major manufacturer and distributor of food products ranging from frozen food and tuna products to pet food and aquatic feed. Its newest pet food, sold under the brand “Monchou” has received good feedback from pet owners.
The main reason that the company has done well during the pandemic is because of the huge changes it made to its commodity business, which was volatile and made low profits.
The company decided to close down one small factory and had its two other frozen food factories working in full capacity. It also stopped producing commodity goods, especially shrimp products for the US market.
Instead, the company shifted its focus to frozen ready-to-cook meals. The Asian Group has held on to the belief that pet food and ready-to-cook meals can compete sustainably in the market of value-added products.
This shift pulled down sales and profits in 2019 due to the cost of reorganising factories and laying off employees, as well as the gradual shift to new products. However, it paid off during the Covid-19 lockdowns when the demand for pet food and ready-to-cook meals surged as people were forced to work from home and maintain social distancing.
From 2018 to 2020, Asian Group’s yearly income stood at 9.8 billion baht, 8.3 billion baht and 8.8 billion baht, respectively with net profits of 362 million baht, 133 million baht and 818 million baht.
In the first nine months of this year, the company’s total sales revenue came in at 7.11 billion baht with a net profit of 779 million baht.
The company has recently announced that it will list its pet food and tuna products manufacturing subsidiary Asian Alliance International in the stock exchange by the end of next year.
The application will be submitted to Thailand’s Security and Exchange Commission in April.
Apart from its pet food products doing exceptionally well, Asian Group is confident that its frozen food and ready-to-cook meals will continue bringing in big profits.
