Krating Daeng keeps its focus on a long-term strategy

“My father said what you don’t feed your children, you should not put on the market,” Sarawut Yoovidhya, chief executive officer, said yesterday, referring to the teaching of Chaleo, who founded the energy-drink empire and died in 2012.
“When I was a student, when I took exams, my father told me to drink Kratingdaeng to maintain my energy level,” he told reporters.
Serving as managing director for years, Sarawut became the CEO this year, taking full control of the empire that last year sold 12 billion bottles of energy drink products. That shows a double-digit growth rate.
Much of the growth in the past two years came from overseas. About 70 per cent of output from the only plant in Thailand, in Prachin Buri, is now geared for markets abroad, mainly in Southeast Asia, where the Kratingdaeng brand is more familiar than Red Bull, another brand co-founded by Chaleo and popular in other parts of the world.
Branding has been another key success factor.
“Our aim is to make our energy drinks respectable,” he said.
Overseas markets will prove more vital to the group amid sluggish economic growth in Thailand. While domestic sales this year are targeted to rise by 10 per cent, the overseas sales growth target is 25 per cent.
To cope with increasing demand and changing consumer behaviour, more product lines will be introduced. This requires constant investment.
In the past five years, TC Pharmaceutical Industries, the producer of Kratingdaeng, has invested Bt500 million annually on average, mainly on machinery.
“Consumers have become segmented. We need to adjust our products and marketing approaches. New products will be developed,” Sarawut said.
Taking the helm at the empire, which employs about 10,000 people, Sarawut said a sustainable growth strategy would be the key focus.
Guiding him were two main principles handed out by his father – food safety and employee care.
“He taught me many things, but these are the two key points. Everybody knows that our group won’t embark on any ‘grey’ areas. Some companies, like alcohol and tobacco, want to use our logistics network. But that’s not our focus,” he said.
On employee care, while international performance measurement is applied, all employees are promised medical benefits as well as other welfare.
“At our current size, financial results are not our goal. Our goal is sustainability. We won’t take risks or deviate from this path for short-term benefits. We have more than 10,000 employees to take care of.”