Thailand: Boonrawd Brewery aims for the number one position in 2006

After losing the Thailand beer market leadership eight years ago, Boonrawd Brewery Co Ltd, maker of Singha and Leo beer, has declared its ambition of reclaiming the number one position in the Bt82-billion beer market this year from its major rival, Chang beer, The Nation of Bangkok, Thailand, published on January 31, 2006 .

The proclamation was announced on January 31 by Boonrawd chief executive Santi Bhirom Bhakdi to a gathering of the company’s staff and more than 1,000 dealers from throughout the country.

The company’s executive vice president and director, Chutinant Bhirom Bhakdi, said the combined market share of Singha and Leo beer products was 44 per cent as of December last year. “We have to increase our total share of the market to at least 48 per cent this year to become the market leader,” he said.

Before Chang beer, made by Thai Beverage Plc, was introduced to the market in about 1998, Boonrawd Brewery dominated the local beer market with a 98 per cent share. The company’s share tumbled to only 30 per cent in 2000 when more than 60 per cent of the market was taken by Chang beer.

“There is no magic bullet for recovering our market position,” Chutinant said. The crisis has forced the company, which has been in the local beer industry for more than 70 years, to undertake a major reshuffle of both its organisation and its way of thinking.

“We were sleeping for decades, because no challenger existed in the market,” Chutinant said. “Now, we have woken up. In the last month of 2005, Singha and Chang were less than one percentage point apart in domestic market share. We are quite satisfied with our domestic performance.”

Chutinant said the company would gradually invest in its brewery facilities and expand its production capacity to serve both domestic and export markets. The company’s two major brewing facilities at Pathum Thani and Khon Kaen pump out a combined 850 million litres per year. “We should give all credit to Khun Santi, who has successfully turned the company around. He is a very good leader,” Chutinant said.

The company has devoted all of its resources to the domestic market over the past eight years to reclaim its number one position. Even now, Santi meets all middle and senior staff every month to exchange ideas and create the business plans.

More than 100 projects, including marketing campaigns, sponsorship activities, sports marketing and other entertainment activities will be launched throughout the year to support the company’s business plans, he said.

Boonrawd currently sponsors more than 10 local sporting clubs and associations as the company wants to build and support Thai talent in both traditional and modern sports, from the grassroots up. The company spends between Bt300 million and Bt400 million annually in sports sponsorships and other support activities.

Chutinant, who also oversees the company’s export business, said this year’s plan was to increase sales in 40 existing export markets, particularly in the US and Europe.

“We will focus more on cooperating with agents to push sales in all our markets. We will also allocate bigger budgets for marketing as well as placing more significance on our export performance in those markets,” said Chutinant.

Boonrawd is also interested in potential export markets including Russia, China and South America. “I have seen Russia as an emerging potential market, as consumers have high purchasing power and the country is just opening for them to spend money. China has good potential, but with very tough competition focusing on cheap prices,” Chutinant said, adding that the company will focus on niche distribution, such as Thai restaurants, in exporting Singha Beer to China.

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