Sappe sets aside B1bn for new warehouse, production line
Sappe Plc, the manufacturer of drinks under the Sappe brand, is to build a new automated warehouse, establish a production line and implement a cost reduction scheme to cope with the new government’s pledge to raise the daily minimum wage.
According to Piyajit Ruckariyapong, the company’s chief executive, the plans are forecast to cost the company about 1 billion baht between 2023 and 2024.
Of the total spending, 300 million baht will be used to build a new automated warehouse in Pathum Thani province, with operations expected to start by the end of this year.
The remaining budget will be used to establish a new production line, support a cost reduction scheme and install new machines next year to support its future growth.
“We don’t have a policy to reduce our workforce because we keep on investing to drive our sales to reach 10 billion baht by 2026. We have already begun outsourcing certain products to original equipment manufacturers,” said Ms Piyajit.
“Fortunately our business has not been significantly affected by the delay in forming a government, as 85% of our revenue is derived from international markets. While we do have a cannabidiol [CBD] beverage in our portfolio, its sales contribution remains below 1%. We are closely monitoring the policies surrounding this product category before making further decisions.”
She said the company intends to continue collaborating with partners to develop innovative products and establish its new S-curve products.
Yesterday the company announced a partnership with Huachiew Chalermprakiet University to introduce two new Chinese herb-based dietary supplements under the brand “Sappe Inyang X Hua Chiew”. These products cater to individuals who experience late nights, work hard with little rest, and have trouble sleeping. Packaged in convenient sachets as ready-to-consume tablets, the supplements target the affluent senior demographic known as the “silver age” group.
Ms Piyajit said the dietary supplement products were initiated by increasing global demand for such products and vitamins because of the pandemic, which compelled people to prioritise their health. Furthermore, Thailand’s transition into an ageing society has prompted consumers to pay more attention to their immune systems. The rising global demand for natural ingredients and herbal-based products has fuelled the use of herbs in various forms, including food, beverages, medicines, and dietary supplements.
The Sappe Inyang X Hua Chiew products were initially introduced through online channels this month and will expand to offline channels next month. Considering the widespread acceptance of Chinese medicine in numerous countries, the company plans to export these new dietary supplements internationally.
According to Ms Piyajit, the Sappe Inyang X Hua Chiew brand will play a key role in driving sales of Sappe’s supplement product portfolio to reach 500 million baht in five years, or 5% of total revenue.
Weerachai Suthithanthawat, a lecturer at Huachiew Chalermprakiet University’s Faculty of Traditional Chinese Medicine, said the collaboration allows the university to hold a licence for the herbs used in the formulas, while Sappe owns the patent for the product formulations.