Chiangrai’s Doi Tung Development Project Expands into e-Commerce

 

CHIANGRAI TIMES – Doi Tung Development Project, entered the commercial world of the Internet today with the launch of its first official online shop – www.doitung.com.

The move is the latest step in the Doi Tung project success story, which began in 1988 and became the culmination of Her Royal Highness the Princess Mother’s lifelong dedication to development work.

The e-commerce venture will support the project’s mission of ensuring that people living at Doi Tung in Chiang Rai province are economically self-reliant and able to continue the process of their own development as responsible citizens, amid an ever-evolving globalised world, without compromising the environment or their own cultural values.

Doi Tung Development Project’s executive director Khunying Puangroi Diskul na Ayudhaya said the concept of doitung.com was to bring local (products) to global (markets), following the project’s efforts to apply global knowledge, such as technology development and design, to local products.

In the early stages of www.doitung.com, the website will offer only small products, in terms of both size and price, with a maximum price of Bt1,000. The early products will come from two of the project’s main categories: coffee and macadamia and handicraft products. Delivery will be limited to people living in Thailand.

“Doi Tung has four main product categories. Apart from coffee and macadamia and handicrafts it also has plants and tourism services,” Puangroi said.

The project intends to trial its e-commerce handling performance until the end of this year. Then, it will increase the number of handicraft products and introduce Doi Tung’s tourism service to the e-commerce site.

She said that doitung.com was a collaborative effort between Doi Tung Development Project and its partners, including The Nation, TOT Corporation, Siam Commercial Bank and Bangkok Airways. The website’s objective is to expand markets for the project’s products and services into the online world, where there are no boundaries to access.

The Nation supports the website development and takes care of public relations and media promotion activities, TOT Corporation provides network support and project funding, Siam Commercial Bank supports the electronic-payment gateway infrastructure and Bangkok Airways provides project funding.

The e-commerce project was initiated by the Doi Tung project’s partners, particularly The Nation, to help the project move beyond the revenue from its physical shops. The project has 28 Doi Tung coffee shops and eight Doi Tung lifestyle shops, which operated at a loss of about Bt10 million last year because some of the shops were closed for months during the political unrest.

Puangroi said www.doitung.com aimed to become a successful role model for OTOP (one tambon, one product) operations and small- and medium-sized enterprises (SMEs).

The project’s back-office system is strong enough to cope with the online extension of its commercial activities. Every year, the project supplies local products to overseas buyers through its wholesale channels, and earns about 20 per cent of its total revenue in this fashion.

Sometime next year, it aims to expand the capabilities of www.doitung.com, allowing overseas customers to make online purchases.

“On day one, when we opened doitung.com, we got orders from overseas – even though we mentioned on the website that it was a trial stage and we were providing e-commerce services for people in Thailand only,” Puangroi said.

She said the Doi Tung project’s head office in Bangkok would connect directly to its logistic centre located at Chiang Rai, and a spare inventory would be set aside amounting to 10 per cent of total projected sales. Online orders at doitung.com will automatically communicate with the inventory system. Once the inventory of any particular product falls to a minimum level, the website will show customers in real time a limit on the number of pieces they can purchase online.

Despite e-commerce being a new venture, Puangroi said the project conservatively aimed to gain an additional Bt5 million in revenue from this channel be the end of next year.

“Since doitung.com is a business-to-consumer (B2C) channel from which people can buy just a few pieces of products, that is a small amount when compared to our total revenue. But it is a long-tail source of revenue,” she said.

The beauty of entering e-commerce is the increased chance it offers to sell more products made and developed by local people living in 150-square-kilometres of the Doi Tung Development Project.

There are 1,700 people working for the project. About 1,000 members of its staff are local people from six ethnic groups living in the Doi Tung area. The project’s annual revenue of Bt400 million is supplied to its staff and is used in product and services development, while an annual budget of Bt23 million provided by the government is spent on maintaining the project’s upland landscape and environment.

“Our local people are not only working with us, but are also living with us. We live together as a family. Our oldest staff members are more than 60 years old. They can live at home and do small jobs like spinning silk. They can earn, work and live in happiness. Seeking revenue is our own job, and entering e-commerce is the latest move,” Puangroi said.

Once doitung.com enters e-commerce “completely” – in terms of increasing the number of its products on offer and expanding to serve overseas customers – the project’s staff and a well-run back-office system will be able to handle huge orders.

“Right now, we are moving step by step to ensure that our e-commerce service can run well and can satisfy our customers,” Puangroi said.