Berli Jucker introduces direct sales, e-commerce
Berli Jucker Plc (BJC), the SET-listed trading and retail company owned by billionaire Charoen Sirivadhanabhakdi, is expanding its product sales and distribution to include direct sales and e-commerce channels after facing tough modern trade competition.
The move is part of Mr Charoen's vision to grow the business from having its own factory, products, brand, distribution network and retail outlets.
Sanchai Thiewprasertkul, senior vice-president for consumer products, said e-commerce had a lot of potential and grew at a double-digit rate annually, while modern trade is highly competitive with sales rising 6% per year.
BJC plans to start selling products via direct sales after hiring My Biz International Co to distribute Premedica Plus skincare products.
Products to be distributed will be different from those available in modern trade and traditional retail outlets. It will distribute food supplements via direct sales next year.
"Direct sales are considered a suitable way to promote skincare products, as sales representatives have time to explain product details to customers," Mr Sanchai said.
BJC expects to generate 200-300 million baht in sales from Premedica Plus products to be sold via My Biz International in the next 12 months.
Mr Sanchai said BJC planned to distribute Premedica Plus products via direct sales in other Asean members to respond to growing demand expected when the Asean Economic Community kicked off late next year.
At the same time, the company plans to explore new market opportunities from e-commerce in the first half of next year.
"We want to adjust our distribution strategy because the trading business has been facing tough competition. Net profit for the trading business has declined to only 10%, as our costs of selling products via the modern trade channel are getting high," Mr Sanchai said.
BJC plans to spend 50-100 million baht to develop its e-commerce business, which is due to start this year. Books from Asia Books stores and consumer products under the BJC group will be available via e-commerce in the future.
Mr Sanchai said domestic consumption remained weak even though farmers had received money from the rice-pledging scheme.
The interim government has no plans to implement populist policies to boost the economy, he said.
However, BJC expects people's purchasing power will bounce back in the second half of next year.
It also expects this year's sales will be on a par with last year's 6 billion baht.
BJC shares closed yesterday on the Stock Exchange of Thailand at 46 baht, down 25 satang, in trade worth 54.4 million baht.