Realizing the potential in Tien Giang province, in 2007, Royal Foods, a leading enterprise specialized in canned food processing in Thailand, decided to set up a canned fish factory in Tien Giang province with a capacity of over 200 tons of the canned fish per day to provide the market in the South in particular and in Vietnam in general.
Mongkol Banthrarungroj, the General Manager of the company, said that since the starting day, the company has achieved sales growth of 80 percent of the domestic market with the key product being canned fish. Although the product price is 20 percent higher than the competitors, the fish can with three ladies trademark that has a strong presence on the market and is recognized and welcomed by customers for its quality. The success of Royal Foods is made by marketing strategies and effective implementation of the distribution channel. Due to the lists of the gift promotion programs for houses, motors and tours to customers and dealers every year, the brand of the company is increasingly closer to more customers.
To create more attraction for consumers and more competitive advantages, the company has invested in machinery and the most modern technology that preserves freshness, flavour and quality of the fish to keep the natural flavours of each product. The company’s products have been certified by HACCP since 2008. In the near future, in addition to the fish can, the Royal Foods will also produce other series of products such as spices.
Therefore, the three ladies brand is recognized by not only the fish box but also other products such as soy sauce, fish sauce, and oyster sauce.
In addition to these successes, the company still has some difficulties. At present, the state is now strictly enforcing regulations that push up transport costs by 120 percent, leading to increasing prices. Meanwhile, the price of fresh fish has been increasing every year; and the sources of fish are not stable, which requires the company to come up with an appropriate procurement strategy.
In this situation, the company has invested in cold storage to stock the fish and buy the fish at harvest or import them from abroad. Thus, even if it is still difficult to buy the raw materials, the company is less affected, which has created momentum for the company to pay its higher efforts to maintain production efficiency.
However, because the company’s market share of the fish cans accounts for 60 percent in Thailand and is ranked first in Vietnam, Laos, Cambodia and Myanmar on sales volume; the exports to Thailand are not enough even though production reaches 100 million cans per year. In addition, Royals Foods’ products are extended throughout ASEAN, which forces the company to expand the plants’ operations to produce 500 million cans per year to meet the market demand.
To handle this issue, the company has invested US$9 million in the plant in Tien Giang province and US$5 million to buy the Royal Food Can Plant of the Tan My Chanh industrial park to supply enough products to Vietnam, Laos, Cambodia and Thailand, along with the construction of the new plant in Nghe An worth US$25 million, including warehousing to store 15,000 tons of frozen products, which is considered the largest frozen storage in the region, to distribute products on this market. Up to now, the company has had five factories in Vietnam. This motivates the company to be the top canned fish brand in the Southeast Asia.
During the development process, Royal Foods is also interested in improving the living standards of its workers and employees. The company always ensures a steady income for workers and avoids lay-offs during low season. Moreover, the company is also implementing various incentives such as housing assistance, scholarships awarded to children of the company’s employees, students at Tien Giang University, and making regular contributions to improve the humanitarian centre. This social work helps Royal Foods consolidate its position in the market and on customers’ minds.