BANGKOK, NNA - Japanese wholesaler Paltac Corp. has teamed up with Thai consumer goods conglomerate Saha Group to build a distribution center in Bangkok with a view to developing logistics business in the Southeast Asian country.
The Osaka-based firm signed a memorandum of understanding with Saha last week to acquire a 30 percent stake in Tiger Distribution & Logistics Co., a Saha subsidiary, later this year and integrate the group's warehouses into the new distribution center near Suvarnabhumi International Airport.
Tiger's Managing Director Vichien Kantathavorn said Paltac will provide its expertise in supply chain and big data management while Tiger garners local customers to rent space in the building.
The logistics base, with a total floor space of 65,000 square meters, is to be built at an investment of 1.8 billion baht ($52.9 million) and scheduled to begin round-the-clock operations in June next year.
The center, combining logistics expertise and information technology to realize faster delivery, is the first overseas investment by Paltac, and it hopes to expand its logistic business to other countries in the region.
The building in the Lat Krabang district of Bangkok is located 10 kilometers from the airport.
Around 20,000 to 30,000 square meters are expected to be occupied in the first year, with the facility becoming fully occupied in three years, according to Vichien.
All existing warehouses owned by Saha's subsidiaries, now situated in different places, will move to the new location within two years after construction.
The subsidiaries are expected to account for 60 percent of the total floor space for use.
Tiger forecasts 400 million baht in sales for this year, up 25 percent from 2016. It hopes to boost its sales by 20 to 30 percent in 2018 when the new base begins operations. (NNA/Kyodo)