thai factories - worth considering or stay well clear?

[devolad]

Have had a search of forum subjects without success.

Am involved (as one of three shareholders) in an importing business that sells audio, small electrical home appliances (toasters, microwaves, rice cookers, dvd players, etc., etc.) from china into Australia and New Zealand.

Business has been going for about 10 years and is reasonably successful.

Notwithstanding fx rate movements, costs for products sourced from china have been steadily increasing - mostly (as per general consensus in media) as a result of increasing labour and material costs.

Presuming that appliance factories exist in Thailand (my initial enquiries suggest this is the case, although I may have bumped into re-sellers of Chinese made products), have any TV members:

1. Had experiences as to quality of product, timeliness of delivery, ability of factories to handle reasonably large production runs; and

2. Had dealings with Thai ports - are they reasonably reliable, free from significant union disruption; and

3. Any other info, pitfalls to be aware of, that may not be easily found out through personal investigation.

Will obviously do a lot of research in person and through formal channels but interested in what any of you may have experienced.

Much Appreciated

[onthemoon]

Considering that Thailand economy is based on export, and that many such products are manufactured here, I would think they are worth considering. Thailand produces 70-80% of the world's harddisks I learned today, is the biggest producer of one-ton pick-up trucks in the world, and is presumably not bad in the market share of optical lenses and PCBs.

You will have to research the factories for white goods and brown goods by yourself, but Thailand as a production location is certainly on the map.

I have had dealings with Thai ports, logistics is my profession. No problems for export.

Pitfalls are that you have to do due diligence - but that's not different from any other country.

[Satcommlee]

If you are making something and exporting Thailand will support you, if you are importing something they will tax you!

[devolad]

Thanks Onthemoon.

Appreciate the response.

Due Diligence will be a must - as with all markets. Was concerned with infrastructure and logistics (particularily transport/port related), but seems this is not such a concern from your experience.

I have done a little background and note there are a few tradeshow/expos on the thai calandar - anyone at TV experienced these, have an opinion as to which ones would be worthwhile attending as a product sourcing exercise?

We regularly go to a number of these in China/HK and America/Europe and have learned that not all are created equal - a lot of expos promise a lot but fail to deliver the goods (so to speak).

Also I have presumed that most factories are located in the greater BKK region in order to access shipping - is this a fair assumption?

(PS: Am a novice at Forums' - if I am in anyway taking the "mickey" or breaching ettiquite by asking questions of a commercial nature please let me know (gently))

[onthemoon]

You will have to check out some trade shows particularly for your product range which you know better than anybody here. Check out the websites of the two biggest exhibition centers: BITEC and Impact. If you choose a show you might want to attend you can ask here again whether anybody has been there.

Factories are located all over Thailand. Your choice will be to buy FOB Bangkok or FOB Laem Chabang, so you don't have to worry about inland transportation.

[Tomtomtom69]

You will have to check out some trade shows particularly for your product range which you know better than anybody here. Check out the websites of the two biggest exhibition centers: BITEC and Impact. If you choose a show you might want to attend you can ask here again whether anybody has been there.

Factories are located all over Thailand. Your choice will be to buy FOB Bangkok or FOB Laem Chabang, so you don't have to worry about inland transportation.

Not really. The vast majority of factories are located on the eastern seaboard, which is fairly close to Bangkok. Not very many factories are located up north or in the north-east, but it depends on the industry. There is a beer factory in Kampaeng Phet and Lays has a factory in Lamphun near Chiang Mai, but apart from that, it's mostly rice mills and agricultural processing that is located anywhere outside central Thailand.

[TravelerEastWest]

The power buy expo might be useful for you - I haven't been there but I found this review (second one down on the front page) http://www.tradeshowthailand.com/

[onthemoon]

You will have to check out some trade shows particularly for your product range which you know better than anybody here. Check out the websites of the two biggest exhibition centers: BITEC and Impact. If you choose a show you might want to attend you can ask here again whether anybody has been there.

Factories are located all over Thailand. Your choice will be to buy FOB Bangkok or FOB Laem Chabang, so you don't have to worry about inland transportation.

Not really. The vast majority of factories are located on the eastern seaboard, which is fairly close to Bangkok. Not very many factories are located up north or in the north-east, but it depends on the industry. There is a beer factory in Kampaeng Phet and Lays has a factory in Lamphun near Chiang Mai, but apart from that, it's mostly rice mills and agricultural processing that is located anywhere outside central Thailand.

Lamphun has a big industrial estate (not only a Lay factory), and we also handle shipments from factories in Korat, Saraburi, Ayutthaya, Lopburi, Tak, Songkkla... While there are many industrial estates on the Eastern Seaboard, the ideal supplier for the OP might be located somewhere totally different. It is simply wrong to say that apart from Bangkok and the Eastern Seaboard, Thailand only produces rice and beer.

[devolad]

Have appreciated all the posts.

A lot more scoping and due diligence to do, but it looks like there may be some possibilities.

Once again, many thanks

[bangkokstick]

I wonder why it could be interesting to do business with Thailand when already doing it with China ?

Everything will cost more in Thailand.

[onthemoon]

I wonder why it could be interesting to do business with Thailand when already doing it with China ?

Everything will cost more in Thailand.

That is probably correct, depending on the product. On the other hand, cheaper is always more expensive.

To give an example: I was in Laos and just wanted to buy batteries for my flashlight in the market. They had AA and AAA batteries for two different prices. I asked what the different is: The cheaper ones were made in China, and the more expensive ones made in Thailand. Digging deeper revealed that the Thai products were perceived as being better. Higher quality, lasting longer.

Cheaper means you have to replace it more often, so in the end it is more expensive to buy low quality. This is true not only for batteries. Only short-term thinkers will choose by the price tag.