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Published on February 1, 2008

Taokaenoi Food and Marketing will emphasise exports of its Taokaenoi seaweed snack this year now that rising production costs are eating into its domestic gross margin.

CEO Itthipat Kulapong-vanich yesterday said costs for palm oil, raw seaweed from Japan and South Korea, transport and packaging soared 20-30 per cent last month.

The company cannot earn as much profit as before from selling seaweed snack products locally, but it enjoys a 10-per-cent profit margin on international sales.

"However, I don't want to solve the problem by hiking prices. That would hurt consumers," he said.

Taokaenoi is shipped to Australia and such Asian markets as Hong Kong, Taiwan, the Philippines and Indonesia, as well as Singapore, where it is the market leader.

"The company started penetrating the US market last year, and I'd like to enlarge this market as much as possible. However, production capacity is not enough to serve exports, so I must focus on our strong market in Asia, particularly Singapore and Hong Kong. But I still hope to tap the US market in the future," he said.

About 40 per cent of Taokaenoi seaweed snacks were exported last year, and the target for this year is 45-50 per cent.

Taokaenoi recently installed a Bt10-million machine that will increase production capacity this month to a million sheets of Japanese seaweed per day, from 700,000 before. If demand keeps growing this year, the company will expand its production line next year.

One-third of this year's Bt45-million marketing budget will be used to promote its products abroad.

"We spent Bt30 million to market locally by launching our first TV commercial, which airs from February 1 until April.

"I'd like to build brand awareness from this channel," he said.

Last year, Taokaenoi's sales increased 80 per cent to Bt400 million, accounting for 57.14 per cent of Thailand's Bt700-million seaweed snack market.

"The market for seaweed snacks grows 60-70 per cent each year, because new players step into this market. I estimate there will be two or three newcomers this year," he said.

Nalin Viboonchart

The Nation