Leading food and beverage Fruitas Holdings Inc. is diversifying into the bakery business, riding on its existing supply and distribution chain to create a new revenue stream focusing on a local staple food.
The new business would be branded “Babot’s Panaderya,” offering freshly baked pan de sal and other bread products in its community stores. As production increases, it would also open several standalone bakeries, initially targeting four in Metro Manila and one in a provincial area.
Fruitas president and chief executive Lester Yu said on Monday the group could open more than five this year. Over the medium term, Fruitas intends to establish a chain of 100 bakeries.
The bread market in the Philippines is estimated to be as much as P200 billion per annum. Bread sales increased by around 30 percent in the second quarter of 2020 at the height of the pandemic-induced lockdown.
“Pan de sal is a staple in Filipinos’ daily diet. Our entry into the bakery business is a natural step to achieve our vision of having every Filipino household consume at least one Fruitas product every day. At the same time, freshly baked bread is a perfect addition to our community stores,” Yu told the Philippine Stock Exchange.
Fruitas aims to reach P500 million in net profit out of P5 billion in annual revenues within the next five years, supported by an expansion of its network across all brands to at least 2,000 locations or about double the footprint seen in 2019. —Doris Dumlao-Abadilla INQ