Jariya Chirathivat, president for marketing and communications, said yesterday that of the Bt4.5 billion earmarked for expansion, about Bt3 billion would be spent on four new stores.

The company will open Big C stores in Lamphun, Hang Dong in Chiang Mai, Koh Samui and Chon Buri.

The expansion will increase Big C's retail network to 53 stores by the end of the year.

In 2006, Big C reported sales of Bt58.03 billion, up 9.1 per cent from Bt53.19 billion in 2005. Net earnings grew to Bt2.12 billion, up 12.8 per cent from Bt1.88 billion in 2005.

Jariya said the company would focus on expanding its store network upcountry because of high density in Bangkok, where 24 Big C stores are trading. There is still room for store openings upcountry, he added.

"We will open a Big C store in Lamphun, to be developed in a compact size of 6,000 square metres to serve such a small community, in the second quarter of the year," said Jariya.

"Our stores in Samui, Hang Dong and Chon Buri will be built in our standard format, with total space of 30,000 square metres, 35,000 square metres and 40,000 square metres, respectively. They will open in the second half of the year."

She said another Bt1.5 billion would be allocated to the renovation of six existing stores, including Big C Supercentres and Big C Town Centres, as part of its ongoing effort to improve customer satisfaction.

In 2006, Big C opened four major stores in Phrae, Ratchaburi, Prachin Buri and Lam Luk Ka in Pathum Thani. It also renovated 11 stores, including those at Wongsawang, Phuket, Nakhon Pathom and Chang Wattana.

Chief financial officer Rumpa Kumhomreun said the company achieved its 2006 performance target in spite of unfavourable circumstances, including declining consumer confidence and reduced spending.

She added that despite last year's economic slowdown and more intense competition, Big C was able to meet its profit targets for the year. This was attributable to the implementation of marketing strategies that successfully met customers' demands.

"Our value-oriented pricing strategy was in line with the current economic situation, where consumers want more value for money," said Rumpa.

"In addition to growing sales, we also improved our operating efficiency and cost reductions through significant enhancements to our nationwide transportation logistics network. Our logistics improvement programme, by changing the way of dispatching from pallet to carton, has reduced operating costs by 5 per cent.

"To further increase efficiency and reduce costs associated with inventory management, we have upgraded our database and IT facilities.

"We also gained the benefit of energy saving by reducing electricity expenses by Bt35 million a year."

Regarding the soon-to-be-announced retail business law, Jariya said that Big C was a member of the Thai Retailers' Association and no details of the new act had been disclosed by the association.

"However, we would like the new act to be clear and transparent and fair to all stakeholders involved in the retail trade," said Jariya.

"Retail is a service set to convey products from manufacturers to individual consumers and to reflect the needs of consumers back to those producers. If any mechanism in this supply-chain system has been abused, then consumers will be those who get the most impact."

Kwanchai Rungfapaisarn

The Nation