NC COCONUT, a producer of natural aromatic coconut water in Ratchaburi province, is moving into the beverage business and will operate as a supplier of processed-coconut products to the industrial sector, to add value to its products in international markets and drive future sales revenue.
The company is investing Bt100 million to expand its operations to coconut processing, for which two financial institutions are ready to approve the required lending, said Narongsak Chuensuchon, founder and managing director of NC Coconut.
Work on the factory expansion will commence early next year and exports of the processed output are expected to begin in the third quarter.
The export market contributes 70-80 per cent of the company’s sales revenue at present.
NC Coconut currently has four products: coconut jelly, coconut in a cup shape, coconut in a dewdrop shape, and coconut in a diamond shape.
Narongsak believes the processing will add value to the coconut, because the processed products will reduce concern over the taste being diminished during the transportation and storage process.
As coconut water can be processed to supply the beverage industry and coconut flesh is in high demand from food and beverage producers, it is a natural step for NC Coconut to transform itself from being solely a fresh-coconut producer into an industrial supplier, he explained.
He plans to supply coconut water in plastic bottles for the export market, he said, adding that the processing will also help maintain the price of coconut and enable any oversupply to be absorbed.
The new processing line will boost annual sales to Bt1 billion within three years, from Bt400 million at present, he added.
NC Coconut plans to increase its registered capital to Bt50 million in the near future, from Bt20 million currently.
The company, meanwhile, is also expanding its combined contract-farming area by 1,000-2,000 rai (160-320 hectares), from the roughly 5,000 rai now under cultivation.
Aromatic coconut water is in high demand overseas, with the company’s main markets being Australia, the United States, mainland China, Singapore and Hong Kong.
“Innovation is the key to doing business, and we are trying to add value to our aromatic coconut products. Apart from the processing plan, we have asked SCG to produce innovative packaging in order to maintain the quality of our products for exporting,” the company founder said.
Important in running the business is thinking how to reinforce the existing product to increase sales, he said, adding that NC Coconut is currently interested in increasing the use of e-commerce to expand its customer base.
The company has sold its aromatic coconut via Chinese websites for three years, which reduces the cost as it cuts out the commission normally paid to dealers.
It is now also interested in selling coconut water and the upcoming processed products on Alibaba.com, he said.
NC Coconut is one of 20 SMEs selected by the Small and Medium Enterprise Development Bank of Thailand and the Export-Import Bank of Thailand as having the potential to sell on the Alibaba website.
“If our products are on Alibaba.com, sales from e-commerce will grow significantly,” Narongsak said.
Despite its relatively small size, NC Coconut is seen as a role model for doing modern business, as it supplies coconut shell as a raw material for a 9.5-megawatt biomass power plant owned and operated by Mahachai Green Power, a VSPP (very small power producer) in Samut Sakhon province. NC Coconut holds a 3-per-cent stake in the power plant.