Fraser & Neave Holdings Bhd Annual Report 2020

057 ANNUAL REPORT 2020 03 md&a EXCELLENCE IN EXECUTION ENSURING PRODUCT AVAILABILITY Our suppliers and distributors are integral to our success as a consumer goods company. To ensure minimal disruption to our production and maintain an adequate inventory of core products during theMCO inMalaysia and the emergency decree in Thailand, we regularly engaged with our trade partners. We also conducted a supplier assessment exercise and took steps to help those unable to meet their business obligations. This included engaging the Ministry of International Trade and Industry (MITI) on behalf of suppliers for permission to resume operations during the MCO. At the same time, we extended our credit lines to several distributors to help ease their financial position. Essentially, strong relationshipswithour diverse pool of suppliers in Malaysia and Thailand helped to maintain the sustainability of our supply chain. GOING DOWN THE RIGHT ROUTES As important as having the right products, it is equally important to offer them through the right channels via effective route-to- market strategies. Launched in January 2020, it was fortuitous that our flagship online store, F&N Life, was up and running when the pandemic hit. Having scaled up our online operations in March to provide consumers with easier access to our products during the MCO, F&N Life now offers no less than 250 product types while achieving more than 20,000 user downloads in less than a year. More than just serving as an e-commerce platform, our vision is for F&N Life to become a lifestyle super app. At the same time, we are also working more closely with e-commerce partners in Malaysia, Thailand and overseas markets to expand the reach of our products to a wider audience. Deepening our market penetration, in Malaysia, we embarked on two initiatives that are gaining traction. The first is a wholesaler bundling programme. The second has been to launch F&N cash sales vans to serve semi-urban and rural areas. At the same time, we have expanded our direct distribution network with a growing number of customers in Central Peninsular Malaysia and East Malaysia. In Thailand, the team continue to strengthen our distribution network and increase coverage by 2,000 new outlets despite muted demand from general trade and foodservice channel due to the emergency decree. This is attributed to strong operational execution and successful trade programs to build brand visibility and availability. Excellence in execution has enabled us to maintain our leadership in our core categories. In Malaysia, we are No.1 in the carbonated soft drink, tea and canned milk segments. In Thailand, we have retained our leadership in the evaporated milk and total sweetened beverage creamer (SBC) markets with Carnation heading the superior segment and TEAPOT maintaining its strong position in the mainstream segment.