This year marks the 5th time that Sunhouse owner Nguyen Xuan Phu will be headquartered at Shark Tank Vietnam. The appeal of the program has helped to promote Shark Phu’s personal brand, as well as the brands he has built, such as Sunhouse home appliances, Richy rice cakes, or Karo rice cakes. Often this veteran shark gives the business model of his projects as a reference for the models of startups that come to raise capital, or even use the ecosystem and experience from there. invite to attract startups to participate.
In Episode 7 of Shark Tank Vietnam Season 4, in the fundraising phase of Begin 365 Protein Bar Company, remember Shark Phu revealed some information about the Karo factory.
When CEO Begin 365 said its factory has an area of 200 m2, a production capacity of 20,000 bars/day, Shark Phu commented: ” 20,000 bar is not worth much. Our Karo cake, is a daily production per day. line, the turnover is already about 1 billion. And he has 5 lines. If this food industry has entered, the number is huge, the problem is how to get into it †
According to information from Shark Phu, it can be estimated that the production output of Karo cake is about 5 billion VND per day.
Sunhouse’s owner also added: Actually, he has a very big food company, a sales force of about 1,500 people, the expected turnover this year is about 3,000 billion VND.”
In Episode 2 of Shark Tank Vietnam Season 5, which aired on June 12, 2022, Richy was mentioned again by the revelation of Shark Phu with a turnover of up to 3,000 billion VND.
Not many people know, behind Richy brand is Hoang Mai Trading and Production Co., Ltd., a company with more than 20 years of development, founded by businessman Tran Sy Truc. Mr. Nguyen Xuan Phu has been on the list of capital contributors of this company since early 2019, with a capital contribution rate at that time of nearly 22%. Together with Mr. Phu, the number of Hoang Mai company’s capital contributing members is up to 8 people, the latter total charter capital is VND 96 billion.
Founded in 2001, Hoang Mai Trading and Production Co., Ltd is a pioneer in importing “foreign” confectionery products to Vietnam. According to the Vietnam Report announcement, Hoang Mai will be one of the 10 prestigious companies in the food and beverage industry in 2021 with the Richy brand.
Hoang Mai’s current business activities run parallel between trading (imported goods) and manufacturing products (confectionery) under the Richy brand.
According to the introduction on the website, the company currently distributes 167 products with well-known brands such as Chocolate Rosen, Rinda, GPG Food, Elvan candy, Lambertz, Apollo,…
With home-produced products, consumers may immediately think of rice cakes when they think of Richy. Richy also has other product lines such as egg tarts, fresh cakes (the most famous Karo), stick cakes, oat cakes and cookies,…
Richy doesn’t just have rice cakes!
Richy products are currently produced at the Northern Richy plant in the industrial cluster of Phung City (Dan Phuong, Hanoi) and Trang Bang Industrial Park (Tay Ninh) under two legal entities, the Northern Richy Company and the Richy Company. southern.
According to research, Southern Richy Company was founded in 2007, the predecessor of Hoang De Dairy and Confectionery Joint Stock Company with charter capital of up to 325 billion VND. Likewise, Northern Richy was founded in 2009.
The two companies do not disclose the ratio of commercial revenues (imported goods) to manufacturing revenues (Richy products), but according to a data source from Young Intellectuals, Hoang Mai’s turnover in 2019 was about VND 2,200 billion, of which the total turnover of 2 Richy factories is only 1/4, about more than 500 billion VND. According to our observation, Richy will not have a new factory from 2020 onwards.
Revenue structure – profit and “extreme difficulty” of the food industry
Usually, the gross profit margin of the manufactured product will be higher than that of the commercial product. As in Episode 7, Season 4, during the Startup presentation, Shark Phu asked, “What are the expected costs between our cost and selling price?”. Startup quickly replied: “Currently, our pricing structure is 25% of the cost price.”
Shark Phu continued, “where else is 75% for other costs and profits” with the comment: “This is also the general formula of the food industry”.
However, according to Mr. Phu, the most difficult stage is the first stage where the product reaches the users and gains their trust. Difficult and ” extremely expensive Shark Phu emphasized.
The story of the Karo product launch was also shared by this shark. Accordingly, Richy company had to launch it for the 3rd time, even if it had to change the brand name to be successful. It is not easy to introduce and market a new product to users even if the product is of good quality.
“In the food industry it is extremely expensive to be successful,” Shark Phu repeated it again.
Richy products can take advantage of the existing distribution and sales system that Hoang Mai has built since 2001. Production tasks after the distribution system is built will overcome barriers that are “extremely expensive,” as Shark Phu said above.
Source: CafeBiz
