Because of its strategic position and low-cost labor, Thailand’s expanding economy presents immense promise for businesses. But still, there are numerous challenges that you must overcome before starting business in Thailand. This article aims to provide you with all the relevant solutions to every associated challenge in doing the same.
However, negotiating the Thai market to realize this promise is difficult. It’s because Thailand, more than any other country, is a conglomeration of economically, culturally, and commercially varied regions. The localization dilemma that Thai companies face should be considered by both investors and entrepreneurs.
Thailand has established itself as a desirable tourist destination as well as a lucrative business environment around the world. Glorifying attestations are there from foreign investors for the success of incorporating business in Thailand. It is usually challenging to start a business in Thailand. How do Thai startups overcome the challenges? Let us explain you –
Make Positive Partnerships
It is crucial to have a positive relationship with other Thai enterprises when starting a business in Thailand. Moreover, a company must use existing Thai firms rather than developing everything in-house in order to expand its market. Especially, it becomes mandatory when there are limited resources. Partnerships allow for rapid market expansion and help companies to launch products and services more quickly and efficiently. On the other hand, making in-house developments is often more expensive and takes longer.
Given Thailand’s uniqueness as a region, developing and maintaining connections is especially important. Startups should collaborate with Thai consulting firms as well as local businesses. In 2016, Lalamove, a Hong Kong-based logistics firm, partnered with Line, a popular chat app in Thailand. The purpose was to create a successful relationship. Line used Lalamove’s distribution network to enter the delivery business. Whereas, Lalamove used Line’s Thai user network of over 30 million to scale into the Thai market. This led to the creation of LINEMAN.
Engage with Thai Regulators
Before starting a business in Thailand, a company must engage in a proper discourse with Thai regulators. One of the main advantages of such involvement early is that it allows entrepreneurs to establish trust with Thai regulators. The difference between a successful startup and a unsuccessful business model in Thailand may come down to mutual understanding and transparency with Thai regulators. Moreover, you must trust that the technology it uses is secure. You must also assure the Thai regulators that your business idea promotes the best interests of Thai consumers. Additionally, your business goals and objectives align with Thailand’s national objectives.
Prepare for Early Expansion
The most important lesson for an existing Thai firm is to expand early. This is to activate and develop a market development strategy from the outset. Additionally, it is much better than waiting to scale and becoming entrenched in a single Thai location. However, this is important since the rate at which a startup expands across several locations, its relationship with Thai authorities and partner network, and its product development all play a role in their success in Thailand. Lazada, an e-commerce behemoth, and Uber, a transportation services app Grab is a great example of a company that started thinking about growing from the beginning.
Plan your Expansion Wisely
Startups should not expand across Thailand and neighboring countries without conducting thorough market research. Localization is crucial in Thailand, as previously stated. Market research agencies in Thailand can assist you with this because each country has its unique customer preferences, spending power, and other market subtleties.
It’s critical to be capital-efficient, especially for businesses in Thailand with limited resources and funding. With this in mind, deciding on the best market approach for early development in Thailand will have far-reaching consequences for scalable firm growth.
Check the Adaptation Level of your Products and Services
While early expansion and communication with authorities and partners are critical for scaling across Thailand, entrepreneurs in Thailand cannot afford to lose sight of their primary offers and their adaptation to the Thai market. Businesses focusing on a single country for several years sometimes overlook product development and lack the resources and time to invest in differentiating their product experience in the Thai market.
Invest in Skill and Talent
The next success criteria is experienced talent, which is difficult to come by in Thailand. It is critical for a startup to invest in strong senior people when expanding or starting a firm in Thailand. A leader who will handle the Thai market must be culturally sensitive, have a solid understanding of the business strategy, and be alert enough to learn from the Thai market and respond appropriately.
While employees play a significant role in carrying out the company’s vision, it is ultimately the company’s vision at the end of the day. It means that while employing the first members of a team, a Thai startup should search for people who can demonstrate a clear understanding of the company’s mission and come up with innovative ideas. A startup needs employees who understand its mission, its customers, and how to turn the startup’s vision into reality.
Focus on Effective Marketing Strategy
Finally, despite having the best product range in Thailand, consumers are still not buying? Most likely, you haven’t done enough market research or carefully selected the right niche to satisfy audience needs. Consistent marketing efforts are necessary to attract potential clients to your firm. If you’re beginning a business in Thailand, you’ll need the assistance of Thailand market research organizations to focus on the complete process of providing customer service, selecting the proper niche, communicating with the right audience, and advertising the niche in the Thai market.
In Thailand, marketing your company is an art form in and of itself. Thailand is becoming more diverse, but its cultural underpinnings remain firm: Thailand’s customs, humor, etiquette, and discourses are unchanging and, at times, stubbornly unyielding. As a result, the identification of your product offerings must be consistent. In Thailand, cultural awareness and sympathetic procedures are essential for marketing. The complexities of its principles have the potential to make or break your company.
The Bottomline
It’s difficult to get things right and avoid blunders while starting a business in Thailand. There’s a lot of work to be done, a lot of KPIs to track, and only so many hands to lend. You must also be mindful of external influences that are beyond your control. Startups who take a deliberate approach to their business and don’t leave anything to chance tend to last longer and scale more quickly.
With the Thai government’s concerted efforts to refocus the country’s economy from an agriculture-based economy to a tech-based economy, the Thai economy is ripe for disruption, and the country is emerging as a hotspot for both foreign and local businesses.
The most important entity that you will need to start your business in Thailand is a reliable and trustworthy law firm in Thailand. Feel free to communicate with our Business Registration Specialists in Thailand. Alternatively, you can also email us at [email protected].
