SET-listed MK Restaurant Group Plc is negotiating to buy some international food brands to diversify its product portfolio in order to reduce risks and grow sustainably.
The food company plans to open at least 40 new restaurants a year, bringing the total to 1,000 by 2021. This will require an annual budget of 400-500 million baht.
Rit Thirakomen, MK's chief executive and chairman of the board, said the company is talking with at least 10 international food brands, ranging from fast food to cafes.
"We want to operate several restaurant brands with international chains and image exposure. The image of operating multiple brands will make us stronger and move the company to another level. Moreover, this move will reduce risk and build a wider customer base," he said.
MK operates several restaurants in Thailand and overseas, including MK suki restaurant, Yayoi Japanese restaurant, Hakata ramen restaurant, Miyazaki teppanyaki restaurant, Le Siam Thai restaurant, Na Siam Thai restaurant and Le Petit cafe and bakery.
In total, the company has more than 600 outlets throughout Asia, including Japan, Vietnam, Singapore and Indonesia.
"The economy has slowed down over the past several years. Our business growth was almost flat in 2015 but grew 4% last year," said Mr Rit. "We expect our sales to grow by 7-9% this year because we believe in the positive economic outlook after seeing better consumer sentiment in the first two months and a clear move by the government to invest in infrastructure projects."
This year MK will spend 400-500 million baht to open 15 MK restaurants, 25 Yayoi outlets and five Miyazaki restaurants.
Yesterday the company unveiled a new business model for MK suki called "MK Live" at The Emquartier shopping complex, targeting premium lifestyle consumers. MK Live is to be the flagship suki restaurant for MK.
Thailand's food industry is projected to be worth about 390 billion baht this year. Premium consumers are undeterred by economic uncertainties, while younger people seek quality food that matches their healthy lifestyles, he said.
In this regard, brand loyalty plays a key role, which inspired the company to create MK Live, said Mr Rit. The new model of suki restaurant targets young adults and families.
MK Live will offer more menu options, more fried food, more premium ingredients and a different decor than previous restaurants.
"We believe MK Live will be a new selling point and create the impetus to grow MK's business," said Tantawan Thirakomen, the company's assistant marketing director.
Last year MK's total revenue stood at 15.5 billion baht, up 4.4% from 2015, with net profit rising 13% to 2.1 billion.
The opening of new MK suki and Yayoi restaurants nationwide and higher same-store sales growth were attributed for the increasing revenue and profit.
M shares closed yesterday on the Stock Exchange of Thailand at 59.50 baht, an increase of 75 satang, in trade worth 9.46 million baht.
