THAILAND – KCG Corporation (KCG), Thailand’s largest dairy producer and distributor, is set to transform its newly opened logistics park from a “cost centre” to a “profit centre,” aiming to become the leading cold food supply chain in the country.
According to Damrongchai Vipawattakul, CEO and Managing Director of KCG, this state-of-the-art facility is designed to enhance the company’s competitive edge while addressing sustainability through its “From Great to Growth” strategy.
The park which opened on August 29, represents a significant investment of over 350 million baht and aligned with KCG’s goal of achieving 10 billion baht in revenue over the next 3-5 years, focusing on quality, technology-driven growth, and environmental sustainability.
The park is envisioned as a world-class distribution centre and warehouse, integral to KCG’s strategy for growth and efficiency. Vipawattakul emphasized that effective supply chain and inventory management are crucial for business expansion.
The logistics park is central to connecting KCG’s high-quality products with consumers, ensuring swift, secure, and quality-preserved deliveries across the country.
“Our distribution centres and warehouses are essential in bridging our production with consumer demand, supporting our sustainable business growth,” he said.
The transformation is a response to evolving consumer demands and the rapid advancement of digitalization and automation in the food industry. KCG is investing heavily in technology to enhance system efficiency and reduce long-term operational costs.
This strategic shift positions KCG as a leader in supply chain innovation within Thailand’s food sector. Previously, KCG utilized multiple rented warehouses, but the company recognized the need for a consolidated location to streamline management.
The new logistics park is expected to save the company around 50 million baht annually on lease and operating costs.
Additionally, the park’s rooftop solar cells are projected to cut electricity bills by approximately 10 million baht per year.
In the long term, the KCG Logistics Park will not only handle the company’s logistics and food distribution, particularly for temperature-controlled items such as butter, cheese, and ice cream, but will also offer these services to other clients.
This move will turn the park into a revenue-generating asset and further demonstrate KCG’s commitment to sustainability.
The park’s robust distribution network, supported by a fleet of over 150 vehicles, will enable same-day deliveries within a 100-kilometre radius. KCG aims to have 30% of its fleet as electric vehicles (EVs) over the next three years.
Danai Galassi, KCG’s Deputy Managing Director, detailed the park’s operational focus.
“We plan to use the park for KCG operations at 70% and provide services to external clients at 30%, with a future goal of a 50:50 ratio.”
The facility can accommodate up to 14,000 pallets, organized into three main product categories: Dairy Products, Food and Bakery Ingredients (FBI), and Biscuits, and features four temperature zones: Ambient, Air Conditioned, Chilled, and Frozen.
KCG’s commitment to cold chain logistics is underscored by its use of automated Warehouse Management Systems (WMS), Transportation Management Systems (TMS), and Fulfilment Systems. These technologies are designed to improve efficiency, accuracy, and speed in product retrieval, reduce product loss, and enable real-time inventory tracking.
In addition to its logistics advancements, KCG’s Q2 performance for this fiscal year reflects robust growth. The company reported revenue of 1.6889 billion baht, an 8.2% increase year-on-year, with a remarkable 86.3% increase in net profit.
The dairy segment remains dominant, generating 60.6% of total revenue. Despite global geopolitical uncertainties and a seasonally weak quarter, KCG’s growth exceeded industry averages.
Looking ahead, the launch of the KCG Logistics Park, combined with existing facilities in Chiang Mai, Khon Kaen, and Surat Thani, is expected to support nationwide coverage and enable product delivery within 24 hours.
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