SCGM Bhd has signed a memorandum of understanding (MoU) with Kim Teck Cheong (KTC) Consolidated Bhd that will enable the thermo-vacuum form plastic packaging manufacturer to penetrate Sabah, Sarawak and Brunei markets.
In the agreement, KTC Consolidated Bhd was appointed the sole distributor of SCGM Bhd’s “Benxon” packaging brand to food and beverage retailers and manufacturers in the said markets.
The MoU was signed by SCGM Bhd managing director Datuk Sri Lee Hock Chai and KTC Consolidated Bhd Group executive director Dexter Lau at the InterContinental Kuala Lumpur.
“The following market expansion efforts are reflected in our revenue growth, with sales in the Malaysian market growing from RM42mil (April 2009) to RM 57mil (December 2015).
“Domestic sales made up 54% of SCGM Bhd’s revenue last year,” Lee said.
He added that KTC Consolidated Bhd was the right partner for their new business endeavour and was optimistic that the partnership would positively contribute to the company’s topline.
Through the newly implemented MoU, SCGM Berhad looks to increase revenue contributions from Sabah, Sarawak and Brunei from 3% to 15% within three years.
Lau said the partnership would bring in increased sales of up to 4% within the year.
“This shall be the benchmark and platform for KTC’s recognition.
“We will not be confined to consumer products, but also venture into packaging, leveraging on SCGM’s unparalleled field expertise,” Lau said.
Also present at the event were KTC Consolidated Bhd group managing director Datuk Lau Kok Sing, KTC Consolidated Berhad associate director of treasury Christina Yap Chui Fui and SCGM Bhd corporate affairs manager David Cheng.
On another note, SCGM Bhd said that the current decline in oil price and weakening ringgit was a “bonus” to them.
“Ninety nine percent of our raw materials are sourced locally, and all of them purchased with Ringgit Malaysia.
“It was a bonus for us because when we do exports, we will gain from the currency appreciation,” said Cheng.