Turnkey Business Follow-up

[jazzbo]

Hello -- I read 2 recent topics about investing in taxis and for other turn-key businesses. I have been advising a Thai friend with a 35+ year old family trucking company. The demand for his trucks has been expanding greatly with some well-known Thai companies as clients.

The company owns a few trucks but most of the trucks are independently owned and he pays them cash on a per load basis from Bangkok to/from the provinces. We have investigated options for increasing his truck availability from his usual local Thai national owners but this could be a very good option for Ex-pats possibly as individual owners, through a limited partnership, or other registered entity.

I caution to give numbers here but his current truck utilization and payment per load could yield a good profit for a reasonably safe investment.

Any ideas? Thanks

[LivinLOS]

My initial scepticism (please only take this as a safety measure) would be..

If there is such a good return in investing in trucks for his transport why wont he do it himself ?? Surely he can gain credit to buy the trucks either with his company or with with the vehicle seller.

Either the lack of future work / guarantee of such is putting him off or something else unpredictable is there.

I just see if it is 'reasonably safe' why would he wish to share that profit ?? He would even be in a position to buy only one or two trucks and still use his existing pay per load making higher profit himself until he is self financing the other truck purchases.

[Indo-Siam]

I am personally planning to relocate my residence from Nana area to Onnuch area later this month. So - I went looking for moving and storage, or local hauling companies aimed at the expat market for short-haul moves in central Bangkok. There is absolutely no one out there even attempting to serve this market.

I have to believe that short-haul relocations for expats are common here. Think of all the relocations that will accompany all the new condos coming on line during the next 2-3 years - not just people moving into a condo- but people back-filling them in their old digs. There's a whole cascade effect.

Most ex-pats move between furnished apartments - they do not have huge loads - maybe just a couple of covered pick-up's worth of goods. A small covered truck, and 3-4 Thai packers who give a @#$& (that might be the tricky part) and you are in business.

I absolutely agree that this is a gaping hole waiting to be filled. I'm a customer waiting for a vendor right now.

Steve

Indo-Siam

[email protected]

[p_brownstone]

I am personally planning to relocate my residence from Nana area to Onnuch area later this month.  So - I went looking for moving and storage, or local hauling companies aimed at the expat market for short-haul moves in central Bangkok.  There is absolutely no one out there even attempting to serve this market.

............. <snip>

I absolutely agree that this is a gaping hole waiting to be filled.  I'm a customer waiting for a vendor right now. 

Steve

Indo-Siam

[email protected]

Whilst there may be no "formal" operation providing this type of service, if you look on almost any large street or parking lot you will see trucks varying in size from pickups to 10 wheelers with "Rot Rab Jang" signs (in Thai of course).

Talk to your girlfriend or your maid, I am sure they will have one turn up within half an hour, complete with a few chaps to help with the lifting - for an additional fee of course.

These trucks are all over the place so I doubt very much that it would be a profitable business for anyone - much less an Expat requiring a steady income.

Patrick

[p_brownstone]

Hello -- I read 2 recent topics about investing in taxis and for other turn-key businesses. I have been advising a Thai friend with a 35+ year old family trucking company. The demand for his trucks has been expanding greatly with some well-known Thai companies as clients.

The company owns a few trucks but most of the trucks are independently owned and he pays them cash on a per load basis from Bangkok to/from the provinces. We have investigated options for increasing his truck availability from his usual local Thai national owners but this could be a very good option for Ex-pats possibly as individual owners, through a limited partnership, or other registered entity.

I caution to give numbers here but his current truck utilization and payment per load could yield a good profit for a reasonably safe investment.

Any ideas? Thanks

I would think that the days of the small Transport Contractor is pretty much numbered in Thailand.

Large local transport Companies like Ruam Thavorn et al are increasingly fighting to maintain their share of the market as major users of Trucks either have their own Fleets or use specialist Contractors with specially equipped vehicles - e.g for Petrochemicals.

Also very large professional (foreign) Logistics Companies are taking a lot of the regular business on long term Contracts and using sophisticated Fuel / Fleet Management Systems which can record everything from an individual Drivers performance and Truck Maintenance details down to the history of a tire to keep control of costs.

Patrick

[boris]

I am personally planning to relocate my residence from Nana area to Onnuch area later this month.  So - I went looking for moving and storage, or local hauling companies aimed at the expat market for short-haul moves in central Bangkok.  There is absolutely no one out there even attempting to serve this market.

I have to believe that short-haul relocations for expats are common here.  Think of all the relocations that will accompany all the new condos coming on line during the next 2-3 years - not just people moving into a condo- but people back-filling them in their old digs.  There's a whole cascade effect.

Most ex-pats move between furnished apartments - they do not have huge loads - maybe just a couple of covered pick-up's worth of goods.  A small covered truck, and 3-4 Thai packers who give a @#$& (that might be the tricky part) and you are in business. 

I absolutely agree that this is a gaping hole waiting to be filled.  I'm a customer waiting for a vendor right now. 

Steve

Indo-Siam

[email protected]

<{POST_SNAPBACK}>

Don't really agree except perhaps for the bottom end of the market where margins thin and virtually no barriers to entry.Reason? Majority of expats would use the same company (or similar) for intra Bangkok moves as processed their stuff when arriving in Bangkok initially -eg Transpo,Crown,Schenker,Santa Fe etc.Obviously more expensive but much more professional taking responsibility for damage etc.

[chuchok]

There are some very substantial Thai Transport companies like LEO Transport/Logistics. Leo is one of the biggest in Thailand.

The overseas personal effects movers, while being quite small certainly do cater for international moves. Are they allowed under Thai law to move domestic shipments? There used to be restrictions on foreign owned freight /logistic companies and what they were allowed to do.

I can remember reading that in the Australian and NZ free trade agreements with Thailand,it would be allowable to set up a foreign owned logistics business.

I'm a bit sketchy on the details.

[snoophound]

its an interesting op

fuel is cheap

when you look at the trucks on the road in thailand,they are in the main old and incredibly fuel inefficient

I suspect the drivers are pretty disorganised as would be the rest of the chain.

Interestingly two Aus companies ,Linfox and Toll are making big bets in Thailand.

Linfox I think has the Tesco Lotus dist deal and Toll have some major accts too.

I think its worth doing a comprehensive business plan.

There are some very substantial Thai Transport companies like LEO Transport/Logistics. Leo is one of the biggest in Thailand.

The overseas personal effects movers, while being quite small certainly do cater for international moves. Are they allowed under Thai law to move domestic shipments? There used to be restrictions on foreign owned freight /logistic companies and what they were allowed to do.

I can remember reading that in the Australian and NZ free trade agreements with Thailand,it would be allowable to set up a foreign owned logistics business.

I'm a bit sketchy on the details.

<{POST_SNAPBACK}>

[jazzbo]

Skeptecism is always prudent. No problem in that.

In the USA, independent 'owner operators' carry a large component of freight without being owned by the contracting shipping company.

The Thai government maintains a web board (in Thai) to link independent trucks with freight and shipping companies.

The company IS buying new trucks but wants to maintain a ratio of owned to contracted trucks.

The company uses its capital currently so that it can pay-off the trucks in cash upon completion of a load--while they must wait for payment from the customer 30 days.

This still may prove not to be a good investment for non-Thais -- I'm just looking for reactions.