Thailand Post, the state-run logistics provider, is planning to expand its retail business to increase its revenue contribution. The CEO, Dhanant Subhadrabandhu, aims to raise the revenue from retail to 30% of the total revenue in the next three years, from the current 5%. The company plans to introduce energy drinks under the PRAI Boost brand by the third quarter of this year, following the successful launches of PRAI drinking water and PRAI Rice brands last year. This move is part of Thailand Post’s strategy to transform its last-mile delivery business into a first-mile service.
Moreover, Thailand Post is considering the opportunity to offer virtual banking services in partnership with potential companies. The company is awaiting clarity on the Bank of Thailand’s licensing regime for virtual banks, which is expected to be revealed by the end of the year.
To enhance its retail business, Thailand Post will utilize its postmen to promote and take orders for the products, enabling consumers to schedule their preferred delivery time for the next day. The company will sell these products at wholesale prices, allowing postmen to earn a profit from direct sales to the public. This approach aligns with Thailand Post’s goal to develop its last-mile delivery service into a first-mile service, adding value to its logistics operations.
Dhanant mentioned that sales of drinking water and rice have already generated a monthly revenue of over 10 million baht, with expectations for continuous growth. Thailand Post has its own drinking water production plant, while rice is sourced through a production contract. For the planned PRAI Boost energy drink, the company is developing a recipe and will contract a selected factory for production. Postmen will handle direct orders and deliver the products to customers.
Additionally, Thailand Post aims to leverage its extensive physical network and customer data to offer virtual banking services. The target audience includes migrant workers and Thais who do not receive a pay slip from their employers.
As of now, transport and logistics contribute to about 45% of Thailand Post’s revenue, followed by the postal group at 30%, and the international service group at 15%. The retail business accounts for 5%, with the remaining revenue falling under the category of ‘others’. The company aims to increase its retail business’s revenue share to 30% within the next three years.
Thailand Post celebrated its 140 years of operation in 2023. In the first half of 2023, the company reported total revenue of 10.8 billion baht, marking a 13% increase compared to the same period in the previous year. The net profit for this period stood at 157 million baht, representing the company’s first profit in recent years. Dhanant projected a profit of 50 million baht for the entire year, citing increased competition in the third quarter as a challenge.
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