Ratch Osathanugrah, left, executive chairman of Osotspa Group of Companies, together with Soonthorn Kengvibul, president of Osotspa International Co Ltd, at yesterday’s launch of ‘Osotspa Goes Global’ campaign.

"We will be more focused on international business. And all working functions will work together to focus more and support our international business rather than domestic. It will be a new chapter for Osotspa to become a real global company," executive chairman Ratch Osathanugrah said yesterday.

The manufacturing and trading conglomerate, which has 65 per cent of the energy-drink market here, set up Osotspa International Co Ltd (OSI) last month to spearhead its international activities.

Under its new corporate vision of "Osotspa Goes Global", Shark will be promoted as a global brand for both carbonated and non-carbonated energy drinks, while M-150 will become a brand for Southeast Asia.

Soonthorn Kengvibul, president of OSI, said worldwide demand for energy drinks, including in Thailand, would surge from Bt320 billion last year to Bt550 billion in five years. Osotspa aims to boost its share of that market from 9 per cent now to 12-15 per cent by 2010.

Osotspa can only envy the head start that Red Bull has. As the first energy-drink brand established worldwide, particularly in Europe, Red Bull sells more than four billion units a year, good for about 55 per cent of the global market.

Red Bull is run by an Austrian firm, with ties to the original Thai producer.

Osotspa's five-year strategy focuses on overseas plants, marketing offices and distribution. It plans to open factories for energy drinkss in densely populated markets including Bangladesh, India and China to tap into their huge demand as well as to overcome high import duties. The plants in Hua Mark of Bangkok and in Ayutthaya are also due for upgrading and expansion to cope with rising exports. The plants have a combined capacity of more than 1.8 billion units a year.

"We plan to export our energy-drink products to Bangladesh within three months and to set up our factory there by next year," Soonthorn said.

Marketing offices have been set up in major markets - Austria, the UK, the US, Burma, Indonesia and Vietnam - to promote awareness of its energy drinks. Its representative office in China is conducting a market study to lay the groundwork for rolling out its energy-drink business in the near future.

More than Bt1.5 billion will be spent this year to promote the company's energy drinks in major markets globally.

"We have set a target to enter all potential markets around the world. They are the US, South America and the Middle East, including Iran, Yemen and Saudi Arabia. We will actively expand our energy-drink products in major markets in Asia such as China, India, Bangladesh, Pakistan and Indonesia," Soonthorn said.

Ratch said group sales increased 8 per cent to Bt16 billion last year, of which 60 per cent came from energy drinks, 30 per cent from consumer goods, and 10 per cent from pharmaceuticals. Group sales are expected to reach Bt20 billion by 2010, he said.

"We would like to double the proportion of our international business from 10 per cent last year to 20 per cent in three years," he said.

Soonthorn said the firm's five-year plan emphasised huge brand investments in high-growth and high-demand markets.

It will be flexible in expanding its energy-drink business country by country.

It will start by appointing local distributors in a country. They will be responsible for only physical distribution, while OSI will handle all marketing activities.

The next step will be to recruit a qualified and experienced distributor to take care of both distribution and marketing. OSI will subsidise all brand-building expenses. As the market matures, OSI will enter into joint ventures with local distributors or manufacturers for local production of its energy drinks based on a profit-sharing formula.

The last scenario is for it to implement integrated operations for manufacturing, marketing and brand-building, in select countries with high potential.

Kwanchai Rungfapaisarn

The Nation