EXPORT FOCUS ON LA BICYCLE BRAND

Local maker to produce more bikes under its own name in foreign-market push

LA Bicycle (Thailand) has set a five-year plan focusing on building its LA Bicycle brand to capture more export markets.

The local company will make more bicycles for its own brand instead of for original equipment orders, bringing the share of its own bikes to 50 per cent by 2012 from 30 per cent now.

Marketing director Jantana Tiyawatchalapong said yesterday that the firm's profit margin on exports under its customers' labels had dropped to 12.5 per cent since the baht started strengthening last October. This prompted the company to revise its strategy to export more under its own brand.

"Our branded product carries a higher margin because we can mark up our prices," she said.

The company will spend Bt130 million to promote its brand, with Bt70 million for brand-building campaigns overseas and the rest for product launches at home.

The company ships to 20 countries. Its UK branch oversees the European and Scandinavian region. Exclusive distributors have been appointed in countries showing potential, including India, Vietnam, Finland, Canada, Greece and Italy.

Last year, the company sold 1.1 million bicycles worth Bt2.4 billion, of which 550,000 were exports. About 70 per cent of its exports carried its customers' labels.

LA Bicycle hopes to boost its share of the domestic market to 65 per cent this year from 60 per cent last year by increasing sales 15 per cent to Bt2.7 billion.

New products will be launched in both domestic and export markets under its three lines - LA Bicycle for pedal power, LA E-Ride for electric bikes and LA Fun & Ride bikes for two- to four-year-old tykes.

Its first new product for this year is an alloy bike for the market here.

The company started making alloy models in 2005, but all of its output of 35,000 units a month has been sent abroad.

This year, the company will cut its alloy exports to 30,000 units and keep the rest - 5,000 units - for the domestic market.

Jantana said local demand for alloy bicycles was 5,000 units a month.

"Almost all alloy bicycles in Thailand are now imported from China, Taiwan and European countries that offer prices between Bt15,000 and Bt300,000 per unit. But our alloy bicycles can undercut import prices by 15 to 20 per cent without sacrificing quality," she added.

Somluck Srimalee

Thailand News
The Nation Thailand
Friday January 26, 2007