March 22, 2014 00:00 By Lamolpet Abhisitniran The Nat
SB Furniture Group, maker and retailer of the Koncept and SB brands of furniture, has revised its mid-term business plan for 2014-2016.
The goal is to focus more on expanding the group’s sales channels, covering a broader range of provinces by increasing the number of branch stores and showrooms.
Looking to the longer term – from 2017 to 2022 – the company plans to develop its logistics with the addition of a distribution centre in preparation for the Asean Economic Community’s implementation next year.
The centre will supplement the current factory in Bang Bua Thong, in Pak Kret district, and its distribution centre in Sai Noi – both in Nonthaburi province.
SB Furniture Group will locate its business close to construction-material distributors to support projected rapid property-development growth in the provinces, said executive Tanyarat Chawaldis, from the company’s Marketing Division.
Domestic sales currently account for 90 per cent of sales, with exports destined largely for the Philippines, Indonesia and Japan.
SB Furniture Group’s mid-term three-year plan will involve new branch stores/showrooms situated close to construction-material dealers such as Mega Home in the major provinces of each region, as well as the appointment of an additional 14 dealers in places such as Chumphon, Si Sa Ket, Mae Sot in Tak province, and Phatthalung, Tanyarat said.
As for the long-term plan, the company will strengthen its logistics system, with the planned second distribution centre being about the same size – 140 rai, or 24.2 hectares – as the facility in Bang Bua Thong.
SB Furniture Group is currently in discussions over a possible link-up with Mega Home, which is affiliated with HomePro, as the building-material distributor plans to have 20 branch stores over the next five years.
Meanwhile, HomePro plans to increase its network of 64 branch stores to 80 within two years. If these plans go ahead, SB Furniture Group’s revenue should double in the same period, Tanyarat added.
Currently, SB-brand products account for 60 per cent of sales, with the Koncept brand taking up the remaining 40 per cent. Dealers make up 40 per cent of sales, with the remaining 60 per cent from SB Furniture’s showrooms and modern trade stores, said the executive.
SB Furniture Group targets 10-per-cent overall sales growth over last year’s Bt6.5 billion, with Koncept furniture expected to see 20-per-cent growth from the Bt2.4 billion generated in 2013.
However, sales growth will depend on the domestic political, economic and business environment, Tanyarat said, adding that in any case, the group’s largest client base – medium-to-high-income customers – should continue to account for strong sales growth.
This is because people in the segment tend to buy homes in the Bt1 million-Bt3 million price range, which is what Koncept furniture is designed for SB-brand furniture, meanwhile, is targeted at the higher-income (B+/A+) client group.
SB Furniture Group has set aside Bt200 million for sales promotion campaigns this year, plus Bt800 million for its new branch store on Rajpruek Road. Bt80 million-Bt90 million is being invested in Koncept-brand sales campaigns over the course of the year.
The overall value of the Thai furniture market is about Bt80 billion-Bt90 billion, the executive added.