Zen Corporation Plc, the operator of restaurant chains such as Zen, AKA and Tummour, plans to double its retail sales to 1.5 billion baht within five years.
According to Boonyong Tansakul, the company's chief executive, the company is ramping up expansion of two subsidiaries that sell seasoning products and seafood raw materials for business-to-business (B2B) customers.
The company is also seeking mergers and acquisitions with potential partners to enable Zen to expand into new product lines.
Mr Boonyong said the strategy will help balance the company's risk from its current heavy reliance on the restaurant business. The restaurant business currently controls up to 90% of the company's revenue.
"We want to forge joint ventures, particularly with small and medium-sized enterprises who have know-how and expertise in production and raw materials. This will help us reduce operating costs while fulfilling our mission to become a total food service company, not just a restaurant firm," Mr Boonyong said.
Zen started its retail business five years ago and later formed a joint venture with Kosum Interfoods Co to handle the production base to support the company's food and retail business both in Thailand and abroad. The joint venture produces fermented fish sauce, dipping sauces, and spicy salad dressings. Various new seasoning products are currently being developed.
In March this year, the Zen subsidiary Spice Synergy Co invested in King Marine Food Co, an importer and producer of fresh and processed seafood raw materials.
According to Mr Boonyong, the company expects to gain almost 400 million baht in revenue from King Marine Food this year, mainly through B2B customers.
The company plans to launch new products for its retail business, supply products to more modern retail stores, and expand into more B2B businesses such as restaurants and hotels in upcountry areas, particularly in tourist destinations.
He said the company also plans to open a new distribution centre, possibly in Udon Thani or Khon Kaen, in the fourth quarter of this year to respond to the massive growth of the food business in the Northeast, reduce transport costs, and more effectively manage raw materials.
"In the past, King Marine Food focused largely on supplying seafood raw material products to Japanese restaurants," said Mr Boonyong.
"But from the second half of this year, the company will function as a one-stop service provider for general restaurants, both Thai and Western."
Apart from B2B clients, King Marine will expand into the business-to-consumer market in the medium term, and also plans to grow its raw material business in Cambodia, Laos, Myanmar and Vietnam.
"We are poised to expand into new kinds of food and new sales channels. Snack food is also in our business pipeline because the market value is so big and it can synergise with our restaurant network with over 400 outlets across the country," Mr Boonyong said.
Zen expects its revenue to reach 3 billion baht this year, 600-700 million baht of which would come from the retail business, and the remainder from the restaurant business and other segments.
