Sales of fashion goods distributed by ICC International fell 20 per cent in the first two months of the year, when the anti-government protests in Bangkok were at their peak, president and executive chairman Boonkiet Chokwatana said recently.
As to the bottom line, the company made almost no profit during the period, with earnings being around break-even point last month.
ICC, a flagship company of Saha Group, is a leading distributor and manufacturer of more than 80 fashion brands such as Absorba, Arrow, BSC, DAKS, Elle, Enfant, Essence, Guy Laroche, Lacoste, Mizuno, Sheene, Speedo and Wacoal.
However, after the consolidation of protest zones to exclude important shopping areas in Bangkok such as Pathum Wan and Ratchaprasong by anti-government protesters led by Suthep Thaugsuban, ICC’s sales have begun to recover this month, growing 15 per cent over the February level, the listed company’s chief told The Nation in an exclusive interview.
Boonkiet said ICC was currently conducting a business restructuring that would see some small brands being discontinued. Nevertheless, unlike last year’s restructuring of Pan Asia Footwear – during which more than 2,000 workers were laid off – ICC would keep on all its workers, he insisted.
ICC reported a 35-per-cent decline in net profit to Bt684.5 million last year, compared with Bt1.05 billion in 2012. Sales revenue dipped 2.55 per cent to total Bt13.33 billion, while gross sales margin decreased 1.84 per cent when compared with a year earlier.
Filing to SET
In its filing to the Stock Exchange of Thailand, ICC pointed to a number of factors that had lowered its results from the previous year: the economic slowdown and political uncertainty that caused consumers to be cautious in their spending; a decline in purchasing power; fiercer competition, especially from a growing pool of foreign brands; the rapid pace of changing customer and consumer preferences, especially in terms of price and sales channels that respond to life-style needs for greater convenience; the 40-per-cent rise in the minimum wage; and a lower extraordinary gain from asset sales.
Major international fast-fashion retailers such as Uniqlo and H&M have during the past few years been expanding rapidly in the Thai market, which was until recently championed by local players like ICC, he added.
Boonkiet said ICC had been trying to develop its own retail sales channel for some time – such as establishing His & Her as standalone outlets in shopping malls – but it had not yet been successful in this regard.
The group will attach more focus to improving its information-technology system and online business channel, as well as to speeding up its business decisions and processes in a bid to stay ahead of the rapidly changing market conditions, he said.
"We were too slow to adjust in some cases. We haven’t been putting in enough marketing effort or been caring enough for our customers," he added.
Meanwhile, ICC has set what the company president called a "super-conservative" target to grow by 5 per cent this year.
New product offerings will not play much of a role in the group’s business-improvement plan, as the emphasis will instead be to focus on making the old products right, he said.