Thread: Starting a Business in Thailand - Tips & Tricks

lots of obstacles in starting a business in los . The more successful u r the more probs u seem to get from officials etc as smug farang says it should be a hobby that u can walk away from cheers

If location is the deciding factor that would leave out Thailand.

For a restaurant it goes like this: Location, Decor, Price, Food Quality.

Thais aren't interested in the uncommon. Especially food.

But this is the answer you're looking for: To make a small fortune in Thailand all you most do is come here with a large fortune.

Hi. I've been here 10 years. Started a business 5 years ago and only now am making money this year. I don't sell to tourists. It can be done but as you have read it is not the easiest road. The most important things are to love what you are doing , know when to fold, don't trust anyone, and be patient!

As you know many people come here for dental/medical work from the usa as it costs 5x more there and insurance/gov aid is not a choice anymore.

There are several people doing now and I'm pretty sure they are making a profit.

No overhead low cost internet ads like this site and the "other" site help you grab the customers..couple that with google adwords and you can get a worllwide presence.

Originally Posted by FailSafe

You're offering exceptions rather than 'rules'- your 'Swiss watch' and other examples are, indeed, ridiculous (a cheap watch and an expensive watch both tell you the time, and in function are exactly the same- a good location will always make you more income than a bad one)- a better comparison would be comparing someone who succeeds despite having no formal education vs. someone with a doctorate who fails miserably- certainly it's not impossible, but who had the better chance to start out?

If you're going to open a niche business like a bowling alley, would you open right next door to another bowling alley that is already doing mediocre business?

Start me off with a good location any day over any other criteria (beyond a good business plan, of course- then again, a good location would be part of my plan to start with).

Have you got any ideas we have not heard before, that don't require a doctorate, and that might give people a reason for optimism?

Originally Posted by wanderer

Originally Posted by FailSafe

You're offering exceptions rather than 'rules'- your 'Swiss watch' and other examples are, indeed, ridiculous (a cheap watch and an expensive watch both tell you the time, and in function are exactly the same- a good location will always make you more income than a bad one)- a better comparison would be comparing someone who succeeds despite having no formal education vs. someone with a doctorate who fails miserably- certainly it's not impossible, but who had the better chance to start out?

If you're going to open a niche business like a bowling alley, would you open right next door to another bowling alley that is already doing mediocre business?

Start me off with a good location any day over any other criteria (beyond a good business plan, of course- then again, a good location would be part of my plan to start with).

Have you got any ideas we have not heard before, that don't require a doctorate, and that might give people a reason for optimism?

I haven't seen anything posted in this thread that required a doctorate- a good location (if possible) is a no-brainer- I can't believe you would argue that- yes, businesses in poor locations have succeeded, but they are the exceptions to the rule.

I haven't seen any originality out of you either.

I currently own three profitable businesses in Thailand (I do some real estate on the side, but I don't count that as a 'business'), and, except for the concepts themselves (forgive me if I don't go into them- I don't want to put too much personal information on a public forum), I followed basic sound business strategies and started with a well-thought-out business plan- they are also all in excellent locations- similar establishments in poorer locations don't do as well.

The one business failure I had was mostly due to a poor location choice- I learned from my mistake, licked my wounds, and moved on.

Other people I know who have gone with bad locations to save money or have more square footage have generally regretted it and wished they would have gone with the better location in the first place.

I'm speaking from my experience here- do you currently operate a business in Thailand?

i am interested in the winery idea as we own some land near mugdahan and thought of starting a small distilery with the hope that we could bring a little money to the villagers by means of salary , oh yes we would also like to make a profit to give my wife an income when i eventualy depart this world

Originally Posted by wanderer

In the Bkk post lawyers advertise work permits for about 6k baht. This would allow someone to run a business and work it themself without employees.

Don't you have to have a Thai partner who has a 51% share which essentially gives them access to the companie's monies?

This is what stops me, I do not trust anyone and the legal loops regarding voting shares sound.. illegal as in "nominees."

Originally Posted by MustavaMond

Originally Posted by wanderer

In the Bkk post lawyers advertise work permits for about 6k baht. This would allow someone to run a business and work it themself without employees.

Don't you have to have a Thai partner who has a 51% share which essentially gives them access to the companie's monies?

This is what stops me, I do not trust anyone and the legal loops regarding voting shares sound.. illegal as in "nominees."

I am aware of this method, but I know an expat in Bkk who "owns" a popular food-service business using this method. Whether it is making money or not considering his overhead is another matter. He got into this business to get away from internet sales, but as of the last time I talked to him, he would also sell this business in a split-second if anybody offered. He has been running this business since 07 or 08, and I have not noticed that suddenly a group of Thai "nominees" swooped in. As I mentioned above, in the case of Zoe in Yellow in Chiang Mai, the expat owners (who also used this method) did suddenly disappear but that may have been because of the relative lack of customers. Zoe in Yellow attracted mainly the ngo crowd working in North Thailand. This guy in Bkk has attracted a different segment of the expat population. What this tells us is that you cannot base a business model on the ngo discretionary income. Ngo workers would not be big drinkers, so they would not keep a bar, like Zoe in Yellow, in business.

The Thai govt is constantly tinkering with the expat ownership laws and the method referred to above was specifically mentioned in the press as subject to scrutiny. But after the dust settles, lawyers usually find another way to cook the goose. A time of political termoil, like now, in Thailand would be the right time to take advantage of this, but strangely the Thai stock market is going up, so foreign investors are not worried.

In addition, there was just an article in the Cambodia Daily about how that country will allow foreigners to own more property. Cambodia passed this law to play catch-up with other Southeast Asian countries who are all liberalising their foreign ownership laws, so they can attract more foreign investment.

Is real estate a decent option? I always thought of owning an apartment complex close to a university. Cheap affordable housing is always needed plus the female students would be pleasing to the eye come rent day.

Are there any laws in Thailand in regards to online businesses selling discounted genuine oem brand name mobile phones, not the cheap chinese copies.
I run this type of business in Australia online as an alternative to ebay where the business is purely an online store where customers place their order and pay for their selected item using paypal or direct money transfer, the phone prices are very attractive as they are close to wholesale prices once the customer pays, the item is then mailed to them by registered post. Has anyone ever heared of this type of business in Thailand, Would there be any forseeable pitfalls, and would you need a licence or business registration?
maintaining the business is by just using a website and direct email contact with the suppliers who are already established.............profit is made between wholesale cost and discounted retail selling prices
Can anyone see a problem with operating this type of business in the land of smiles?

I'm rebooting this thread to ask about the steps, and licences, and generally update the info if anything's changed.

This stuff below is useful, but doesn't have any numbers about how much money needs to be put up either by a setup involving a foreigner, or a setup where all the parties are dual nationals.

How to Set Up a Thai Limited Company as a Foreigner

Last updated: January 31st, 2015 | in Working
A Thai Limited Company is the most common type of all Thai companies. No matter if you want to run a restaurant, a bar, a hotel, a coffee shop, a beauty salon, an online business, a spa, a motorbike rental service or most other business objectives that come into your mind – you will need to set up a Thai Limited Company.
Ownership Requirements for a Thai Limited Company
There have to be at least three shareholders owning a Thai Limited Company and at least 51% of the shares must be owned by a Thai legal entity (natural person or company). There are three exceptions to this law:

• Companies set up by foreigners holding US citizenship using the Amity Treaty
• Companies set up under the support of the Board of Investment (BOI)
• Companies that only export products and services

A Sole Proprietorship company type is only for Thai citizens as it doesn’t allow to issue work permits for foreigners.
The 8 Steps of Setting Up a Thai Limited Company

1. Reservation of the Company Name
There are two basic requirements regarding the company name. First, the suggested company name cannot be similar to another company that has already been registered in Thailand and second, certain company names are not allowed (no vulgar words or phrases that are related to the royal family). There have to be three different company names submitted to the Department of Business Development (DBD), ordered by priority.
2. Filing a Memorandum of Association
Once the company name is approved, all shareholders must sign a Memorandum of Association (MOA) providing the names and personal details of every shareholder, the company’s address, the registered capital and the intended scope of business activities during the first year. The MOA and the relevant registration documents have to be submitted to the Ministry of Commerce. A company seal is required (1,000 baht) and other fees include 50 baht for every 100,000 baht of registered capital (minimum 500 baht, maximum 25,000 baht) for the Memorandum Registration, 3,000 baht for the Share Certificate Issuance and 1,500 baht for the Company Shareholder Registration Book.
3. Registering the Company
When all the shares have been reserved by the Ministry of Commerce, the next step is to hold a statutory meeting and a minimum of 25% of the registered capital has to be paid-in. Following that the Ministry of Commerce will issue the company affidavit, company certificate, list of shareholders and the company articles of association. The company can now start operations.
4. Registering Tax ID and VAT
Within 60 days after start of operations the company has to submit an application for a Tax ID Card as well as to register the company into the VAT System and to receive a VAT certificate.
The minimum requirement regarding accounting is the monthly withholding tax and social fund submission as well as the half year report and the annual audit including yearly profit-and-loss statement and the balance sheet.
5. Operational Licensing
There are certain licenses that have to be obtained for specific business objectives. These include: Food License, Alcohol License, Cigarette License, Entertainment License, E-Commerce License, Import License, Factory License, Internet Cafe License and Import-Export Card.
6. Social Fund Registration
Before you can apply for work permits for any foreigners working for the company (including yourself) you need to hire four Thai employees per one work permit being applied for and by doing so you need to register these Thai employees into the Social Fund System and pay at least a three month fee for them into it. The amount of these contributions is depends on the salary – employer and employee have to pay 5% each of the employees salary into the Social Fund on a monthly basis. More information about the minimum salary for Thai nationals you can find here.
7. Obtaining Work Permits
A Thai limited company must have two million baht of registered capital and four Thai employees for each work permit being issued to a foreigner. For more information on how to apply for a work permit, have a look at this post. Before you can apply for a work permit, you must hold a Non Immigrant Business Visa.
8. Opening a Company Bank Account
The last step in a Thai Limited Company set up procedure is to open a company bank account, for which the bank requires minutes of the meeting of the board of directors to open the account.

How to Set Up a Thai Limited Company as a Foreigner | Thailand Redcat

Originally Posted by CaptainNemo

I'm rebooting this thread to ask about the steps, and licences, and generally update the info if anything's changed.

This stuff below is useful, but doesn't have any numbers about how much money needs to be put up either by a setup involving a foreigner, or a setup where all the parties are dual nationals.

How to Set Up a Thai Limited Company as a Foreigner

Last updated: January 31st, 2015 | in Working
A Thai Limited Company is the most common type of all Thai companies. No matter if you want to run a restaurant, a bar, a hotel, a coffee shop, a beauty salon, an online business, a spa, a motorbike rental service or most other business objectives that come into your mind – you will need to set up a Thai Limited Company.
Ownership Requirements for a Thai Limited Company

There have to be at least three shareholders owning a Thai Limited Company and at least 51% of the shares must be owned by a Thai legal entity (natural person or company). There are three exceptions to this law:

• Companies set up by foreigners holding US citizenship using the Amity Treaty
• Companies set up under the support of the Board of Investment (BOI)
• Companies that only export products and services

A Sole Proprietorship company type is only for Thai citizens as it doesn’t allow to issue work permits for foreigners.
The 8 Steps of Setting Up a Thai Limited Company

1. Reservation of the Company Name
There are two basic requirements regarding the company name. First, the suggested company name cannot be similar to another company that has already been registered in Thailand and second, certain company names are not allowed (no vulgar words or phrases that are related to the royal family). There have to be three different company names submitted to the Department of Business Development (DBD), ordered by priority.
2. Filing a Memorandum of Association
Once the company name is approved, all shareholders must sign a Memorandum of Association (MOA) providing the names and personal details of every shareholder, the company’s address, the registered capital and the intended scope of business activities during the first year. The MOA and the relevant registration documents have to be submitted to the Ministry of Commerce. A company seal is required (1,000 baht) and other fees include 50 baht for every 100,000 baht of registered capital (minimum 500 baht, maximum 25,000 baht) for the Memorandum Registration, 3,000 baht for the Share Certificate Issuance and 1,500 baht for the Company Shareholder Registration Book.
3. Registering the Company
When all the shares have been reserved by the Ministry of Commerce, the next step is to hold a statutory meeting and a minimum of 25% of the registered capital has to be paid-in. Following that the Ministry of Commerce will issue the company affidavit, company certificate, list of shareholders and the company articles of association. The company can now start operations.
4. Registering Tax ID and VAT
Within 60 days after start of operations the company has to submit an application for a Tax ID Card as well as to register the company into the VAT System and to receive a VAT certificate.
The minimum requirement regarding accounting is the monthly withholding tax and social fund submission as well as the half year report and the annual audit including yearly profit-and-loss statement and the balance sheet.
5. Operational Licensing
There are certain licenses that have to be obtained for specific business objectives. These include: Food License, Alcohol License, Cigarette License, Entertainment License, E-Commerce License, Import License, Factory License, Internet Cafe License and Import-Export Card.
6. Social Fund Registration
Before you can apply for work permits for any foreigners working for the company (including yourself) you need to hire four Thai employees per one work permit being applied for and by doing so you need to register these Thai employees into the Social Fund System and pay at least a three month fee for them into it. The amount of these contributions is depends on the salary – employer and employee have to pay 5% each of the employees salary into the Social Fund on a monthly basis. More information about the minimum salary for Thai nationals you can find here.
7. Obtaining Work Permits
A Thai limited company must have two million baht of registered capital and four Thai employees for each work permit being issued to a foreigner. For more information on how to apply for a work permit, have a look at this post. Before you can apply for a work permit, you must hold a Non Immigrant Business Visa.
8. Opening a Company Bank Account
The last step in a Thai Limited Company set up procedure is to open a company bank account, for which the bank requires minutes of the meeting of the board of directors to open the account.

How to Set Up a Thai Limited Company as a Foreigner | Thailand Redcat

Or other variables as: dealing with twisted Thai bureaucracy, integrating one's business into Thai social order/community, employee relations [Thai or others], etc....

good points, yeah.

Lots of great advice in here already, I especially like and agree with the "be invisible" rule.

I would add, learn Thai customs and practice them with your employees, it makes you much more relatable for Thais and breaks down the "you are and will always be a foreigner" mentally. Do small things that show your workers you are really investing in them and the business. This way they feel you aren't just here to make yourself successful, but them as well.

Also, is there a thread where farang can talk about possible business venture collaborations?

A farang business owner should always ensure that his Thai staff are managed by a competent and trustworthy Thai placed in a position of authority. The further the farang distances himself the better - respect is automatically accorded and will be genuine provided he has a 'good heart' and is fair, although there should always be an element of fear.

If things don't seem to be working throw more money at the problem.

I'm thinking of starting a Pie business in Isaan, any tips and market research done by the esteemed Teakdoor market research experts suggest that the many Farang bars and restaurants have a pressing need for good old Hybrid pies, an Australian Masterchef cross between Aussie and Jamacian British pie skills of excellence.
Any suggestions on where to start an Isaan billion £ & $ industry just waiting to take off.

Originally Posted by Seekingasylum

The further the farang distances himself the better

Businesses with hands-off owners are a receipe for failure

Personally I would not open a business in Thailand. Not with a physical location at least. Success would breed people interested in stealing your business and/or money.

Originally Posted by redhaze

Originally Posted by Seekingasylum

The further the farang distances himself the better

Businesses with hands-off owners are a receipe for failure

Personally I would not open a business in Thailand. Not with a physical location at least. Success would breed people interested in stealing your business and/or money.

Agree RH. My business has struggled due to my FIFO life. Also a Thai manager with an MBA means SFA.

Agreed I have a business in Laos that suffers terribly when I am away. Every time I come back it is like I have to redouble my efforts just to stabilize it. To assume you can train Thais to do do your job or play your role in your absence is dangerous.

Particularly if you have a business such as a bar or guesthouse that operates on word of mouth. The word gets out you aren't there and people won't come anymore if you are away extended periods.