Thailand has two million online shopping transactions daily, compared with 200,000 in Singapore1. Singapore companies in the consumer space can offer localised online shopping experiences for the Thai consumer to tap this market.
For example, you can work with end-to-end cross-border e-commerce logistics enablers to deliver your products to Thailand directly, or work through established multi-brand platforms such as Lazada, Central or WeLoveShopping to reach out to your customers.
You can also set up your own online presence, like e-commerce startup Anchanto, a Singapore company which has ventured successfully to Thailand. The company’s one-stop platform allows retailers to list products and manage inventory across multiple e-commerce marketplaces, making it easier for sellers to scale up rapidly.
If you are a Singapore startup, get onboard the Global Innovation Alliance (GIA) Bangkok to connect to the Thai tech ecosystem. You will have easier market access, such as when you set up in the True Digital Park - ACE Singapore Centre, one of the partnerships inked under the GIA. You can also collaborate with in-market partners sourced by the GIA, such as The Finlab, UOB Thailand and Digital Economy Promotion Agency.
Find out how GIA Bangkok can help you gain entry points into the Thai market, form partnerships with Thai startups, and build a pipeline of talent for your company.
1: “Singapore start-ups in Thailand get a leg up with new alliance”, The Straits Times, 27 April 2018
Did you know that Thailand is also often referred to as the “Detroit of the East”? That’s because its automotive industry is a key node in the world’s automotive supply chain. Half of the world’s top 100 auto parts manufacturers and industry leaders are operating in Thailand, including GM, Isuzu, Mercedes-Benz, and Toyota. These successes ranked the country as the largest automotive producer in Southeast Asia and 12th in the world2.
Thailand plans to transform itself into a global green automotive production base. As a Singapore company, you stand to receive incentives such as tax exemptions and permits to bring in your expertise. This presents opportunities for your company to provide niche technological components in the production of hybrid/ electric vehicles and automotive electronics.
Dubbed the “Kitchen of the World”, Thailand is a global food production hub. It has an abundance of natural resources – 80% of the raw materials in domestic food manufacturing are sourced locally. This means if you are planning to venture into Thailand’s food industry, there are potential savings in terms of lower logistics and import costs for raw materials.
The country adheres to stringent food manufacturing standards such as Codex, OIE Standards and the International Plant Protection Convention. Hence, sourcing local operational support and facilitating knowledge transfer would be easier.
The Thai government has also shown a commitment to transforming Thailand into a high-tech food and agriculture hub. If you are a Singapore company looking to contribute to Thailand’s food industry, consider the Food Innopolis.
Featuring state-of-the-art facilities and units dedicated to biotechnology, biosensing and biodiversity, the Food Innopolis incubates research, development and innovation for the food industry. The Thailand Board of Investment offers a wide range of incentives to companies that set up advanced facilities in the country, such as corporate income tax exemptions of up to 13 years.
Did you also know that Thailand has its own halal food accreditation scheme? As demand for ready-to-eat and halal food increases globally, Thailand could be a potential manufacturing location for Singapore companies looking to tap this trend.
2: “Thailand’s Automotive Industry: The Next-Generation”, Thailand Board of Investment, 2018
With a population of over 69 million, Thailand is the second largest consumer market in Southeast Asia. Thailand’s high consumption expenditure, which makes up more than half of its gross domestic product, translates into a large consumer market which Singapore companies can sell to.
Thailand’s consumer outlook is healthy, with a growing middle class that is willing to spend not just on household essentials but also on leisure activities, luxuries, and travel. Against this backdrop, industries with potential opportunities include food and beverage, as well as medical tourism.
Another contributing factor to Thailand’s rising consumerism is the female workforce. In 2017, the figure stands at 60%, which is higher compared to Malaysia and Indonesia. Women in Thailand enjoy financial autonomy when they enter the workforce. This allows them to have greater control over their spending patterns in non-essentials such as skin-care, make-up and accessories3.
If you are looking to enter Thailand’s consumer market, do note that the country’s Foreign Business Act regulates the extent of non-Thai participation in certain business activities. This includes retail and distribution, logistics and food services.
To overcome the restrictions, Singapore companies can consider alternative business models and partnerships, such as working via a local distributor, franchise partner or a minority share joint venture with a local Thai partner.
3: “Thailand’s consumer spending to see growth in 2018”, Singapore Business Review, 18 July 2018
The Thai government has rolled out a 3.3 trillion baht (US$101 billion) Infrastructure Development Plan (2015-2022) consisting of aviation, mass transit, railway, roads, and water transportation projects. Other than improving the country's ageing road and rail links, it helps to strengthen Thailand’s position as the gateway into Indochina.
Thailand is also remaking U-Tapao Airport, the gateway to its Eastern Economic Corridor (EEC), ensuring that state-of-the-art logistics facilities are in place to draw advanced manufacturers from around the globe.
If your company has expertise and capabilities in aviation and logistics, you can capture some of these EEC opportunities given its connectivity and export focus. There are various investment benefits offered by the Thai government that work to your advantage.
Most of these projects are likely to be implemented under Thailand’s new public-private partnership framework, which aims to speed up and facilitate private investment spending on infrastructure projects.
Singapore companies can look at partnering local conglomerates and offering value-add in areas such as mechanical and electrical consultancy, operations and maintenance, project management, and the supply of equipment. Entering via joint ventures will also mitigate some restrictions imposed by Thailand’s Foreign Business Act.
You can be a part of this exciting transformation of Thailand’s infrastructure industry. Check out how our full suite of services can support your business expansion to Thailand.