Doi Kham Food Products expands into ice cream market amid declining fruit juice demand
Doi Kham Food Products Co, a Thai manufacturer and distributor of fruit juice and dried fruit has expanded its business to enter Thailand’s 15-billion-baht ice cream market in an effort to counter the ongoing decline in fruit juice demand.
Chanannat Polpathapee, the company’s executive vice president for sales and marketing, said the Thai fruit juice market, particularly in the middle to premium segments, has experienced an average annual decrease of 5-10% over the past few years, amounting to 4.5 billion baht in 2022, down from approximately 10 billion baht a year during the previous decade.
Polpathapee suggested that the market is likely to continue declining due to consumers having a wider choice of beverages, particularly functional drinks, which offer various formats and flavours.
A collaboration with Wall’s ice cream two years ago led Doi Kham to decide to produce its own ice cream, she said.
“We studied the ice cream business for more than two years. The pandemic caused our business plan to be postponed,” explained Polpathapee.
Pipatpong Israsena Na Ayudhya, the company’s president and chief executive, noted that although the pandemic has affected many business sectors, ice cream has not been significantly impacted.
Doi Kham launched three ice pops in the middle of last month. Made from real fruit at its Mae Chan factory in Chiang Rai, these ice creams feature environmentally friendly packaging. The company plans to introduce new products in the second half of this year.
“Doi Kham Ice Pop is a niche product. It is an ambience ice cream that can be stored at regular temperatures, unlike conventional frozen ice cream. We want our ice cream products to be a new alternative for generation Z and Y customers who seek fresh, convenient products,” Polpathapee said.
Doi Kham ice cream is available at over 30 Doi Kham shops and 14 franchises, as well as various modern retail chains, including Tops, Lotus’s, Big C, and Makro. It will be sold in 7-Eleven convenience stores from next month.
“Doi Kham Ice Pop will be our growth engine that can offset the declining fruit juice,” Polpathapee added.
Following a positive response to ice cream in China, South Korea, and Vietnam, the company participated in an international trade fair in Japan in March this year to promote its Doi Kham Ice Pop, with the possibility of exporting the product overseas this year.
The company anticipates sales of Doi Kham ice cream to reach 50 million baht this year, with projections of 600-700 million baht over the next seven years, including export revenues.
According to Polpathapee, as the fruit juice market continues to decline, the company will investigate opportunities within new product categories that appeal to the younger generation during the second half of this year.
Additionally, Doi Kham plans to expand its business into B2B channels, such as hotels, restaurants, and catering and is conducting a feasibility study to launch a sister brand for new products that cater to all customer lifestyles.
The company expects its sales this year to reach 2.2 billion baht, an increase from 2.06 billion baht in 2022, reports Bangkok Post.
