With slow growth in student shoe sales for several years as birth rates decline, SCS Sportswear Co, the maker of the SCS and Breaker shoe brands, keeps diversifying into drugstores, residential projects and especially food.
According to Witsanu Vongveeranonchai, the company's vice-president, remaining reliant on student shoe sales as the firm has for four decades would pose a serious business risk.
"Fewer babies are born these days because people are hesitant to marry, and those who do marry have fewer children," Mr Witsanu said. "For this reason, our family started rethinking the company's business direction to make our group's business sustainable in the long run."
With the growing wave of health consciousness in Thailand, drugstores are one of the company's new revenue streams. SCS now has nine drugstores.
"Drugstores are nonetheless not as good as expected, and we are now exploring opportunities in food, whose market value is very big at over 400 billion baht a year," said Sirirat Vongveeranonchai, the company's communications director.
SCS opened the first Kokonut restaurant two years ago on Nawamin Road, and a second branch opened at the Glas Haus building on Sukhumvit Soi 25.
Kokonut is under the operation of SCS Future Co, a subsidiary of SCS Sportswear Co. It offers ready-to-eat food for convenience, focusing on healthy food items.
"Although we entered the food business without any experience, I and my cousin have a passion for food," Ms Sirirat said with a laugh.
And after a better-than-expected response from customers, the company is pushing further, planning to open five or six Kokonut restaurants in Bangkok this year.
Each store requires an investment of 3-4 million baht. The company also aims to offer Kokonut meal delivery and a franchise system soon.
"Sales at Kokonut are still small but showing good signs for a new player like us," Ms Sirirat said. "We plan to open more Kokonut stores over the next few years."
In addition to drugstores and restaurants, SCS has spent the past few years developing a condominium project called The Wellington on Ramkhamhaeng Soi 40 and a townhome project on Srinakarin Road.
According to Mr Witsanu, the company has decades of experience as an original equipment manufacturer for many international sport and fashion shoe brands.
The firm is leveraging new market opportunities in fashion and sports shoes this year, focusing on futsal shoes.
The exclusive Breaker X sneaker collections will be launched on the online channel throughout the year to expand the customer base beyond students and shore up brand awareness.
Prices of Breaker X sneakers online will start at 3,000 baht, close to the level of international brands.
"We want to change customers' perception of the Breaker brand from a student shoe to a fashion shoe brand, which will help pave the way for our future expansion," Mr Witsanu said.
Thailand's shoe business is estimated at 20 billion baht. Of the total, some 8 billion baht is in sport and fashion shoes, plus 5 billion each for student shoes and sandals. The remaining 2 billion baht is in other categories.
Mr Witsanu said student shoe sales are expected to remain in a slow growth mode this year because the economy is not as strong as expected.
