Ex Pat Outsourcing In Thailand

[siamamerican]

I lived in Chiang Mai from 2000 to 2003. I met many successful business men and college students through biking clubs and races. Their English was good, but not good enough to sell or support a US based operation.

I'm currently an exec at a US based company. We have had some success with our operations in the Philippines and India, but they aren't profitable.

Would it be possible to hire English speaking Ex pats in Thailand to support sales of US based products? If the answer is yes, would I need a Thai partner and are there consulting firms that could assist with the legal issues. My current employer would insist that all Thai laws and regulations be followed.

Thanks for taking the the time to read my post and I would appreciate any advice.

[richard10365]

Maybe your U.S. based product was not profitable because similar products can be made cheaper in the countries you were trying to market them.

Make your products in the countries your trying to sell them in, lower the price and you might be more successful.

[Maestro]

Would it be possible to hire English speaking Ex pats in Thailand to support sales of US based products? If the answer is yes, would I need a Thai partner and are there consulting firms that could assist with the legal issues. My current employer would insist that all Thai laws and regulations be followed.

You don’t say what your product is, but basically you have two choices:

1. Make a contract with an existing importer/distributor in Thailand to market your product in Thailand.

2. Set up a company in Thailand, managed perhaps by an expat to

a) liaise with your US head office

employ suitable staff in Thailand as sales persons (expats, if necessary), etc.

The language skills you require of the sales staff will obviously depend on the language spoken by the prospective buyers of your product. From your post it seems that your product is directed exclusively at English-speaking persons.

--------------

Maestro

Edited September 4, 2006 by maestro

[jdinasia]

I lived in Chiang Mai from 2000 to 2003. I met many successful business men and college students through biking clubs and races. Their English was good, but not good enough to sell or support a US based operation.

I'm currently an exec at a US based company. We have had some success with our operations in the Philippines and India, but they aren't profitable.

Would it be possible to hire English speaking Ex pats in Thailand to support sales of US based products? If the answer is yes, would I need a Thai partner and are there consulting firms that could assist with the legal issues. My current employer would insist that all Thai laws and regulations be followed.

Thanks for taking the the time to read my post and I would appreciate any advice.

Lots of options for Yanks to set up Biz's in thailand But better hurry ....!!

Read in the main part of the site <Thaivisa.com> and on Sunbeltasia's site

[migrant]

I lived in Chiang Mai from 2000 to 2003. I met many successful business men and college students through biking clubs and races. Their English was good, but not good enough to sell or support a US based operation.

I'm currently an exec at a US based company. We have had some success with our operations in the Philippines and India, but they aren't profitable.

Would it be possible to hire English speaking Ex pats in Thailand to support sales of US based products? If the answer is yes, would I need a Thai partner and are there consulting firms that could assist with the legal issues. My current employer would insist that all Thai laws and regulations be followed.

Thanks for taking the the time to read my post and I would appreciate any advice.

Lots of options for Yanks to set up Biz's in thailand But better hurry ....!!

Read in the main part of the site <Thaivisa.com> and on Sunbeltasia's site

Barring the market research mentioned above, many US companies have set up in Thailand.

jdinasia has a excellent point, the Amity treaty between Thailand and us Americans gives us some opportunities that other western countries do not have

[siamamerican]

Sorry, I left out too many details. The product would be loans(mostly secured) and the customers would be based in the US. I would move to Thailand to manage the office. We currently opperate in the San Fran area, where labor is far from cheap.

*Migrant - why is it easier for US based companies to setup operations in Thailand?

*How difficult would it be to hire quality ex pats with preferably a college education? During the startup phase I would only need 5-10 English speaking ex pats. The comp would be 60,000 bt base + bonuses(20k- 60k).

*Does anyone know of a company that could assist with the legal issues?

[jdinasia]

Better talk with Sunbelt ... not sure IF we can do that here as a soley owned/foriegn Company

[sleepyjohn]

*How difficult would it be to hire quality ex pats with preferably a college education? During the startup phase I would only need 5-10 English speaking ex pats. The comp would be 60,000 bt base + bonuses(20k- 60k).

Have you ever heard the expression "if you pay peanuts you'll get monkeys"?

[siamamerican]

Time to wakeup sleepyjohn.

100,000 bt(average all in comp I would pay in Thailand) would be almost equivalent to what I would have to pay sales support staff in the Midwestern US. Please tell me why a company would open a business in Thailand and realize no cost savings compared to a US based operation.

There would also be opportunities for successful employees to move into sales and double their income. Outsourcing sales is where the biggest cost savings would be realized, but not where I want to start.

I know some make more teaching English and enjoy what they are doing - more power to them and it's a noble profession. As for me, if I were in Thailand earning 30,000 to 60,000 bt teaching English, I would jump at the opportunity.

[migrant]

*Migrant - why is it easier for US based companies to setup operations in Thailand?

*Does anyone know of a company that could assist with the legal issues?

siamamerican

I am not an expert, but the US and Thailand signed a treaty, called the Amity treaty to help give some reciprocity for Thais owning US businesses.

It gives us Americans a better position to actually own businesses in Thailand, and, I believe, allows us to work in otherwise proscribed professions.

Sunbelt here (a sponsor) is well versed here, and there has been further discussion if you search some threads.

[siamamerican]

Better talk with Sunbelt ... not sure IF we can do that here as a soley owned/foriegn Company

====================================

Thanks jdinasia - I need to get the CEO's buy in before talking to Sunbelt. We've spent over $100 mil(US) the last few years marketing our brand name and I need his blessing. I think there is little risk of damaging the brand, especially since the employees will native English speakers.

Do you work for Sunbelt? Are they a reputable company?

Edited September 4, 2006 by siamamerican

[siamamerican]

[

siamamerican

I am not an expert, but the US and Thailand signed a treaty, called the Amity treaty to help give some reciprocity for Thais owning US businesses.

It gives us Americans a better position to actually own businesses in Thailand, and, I believe, allows us to work in otherwise proscribed professions.

Sunbelt here (a sponsor) is well versed here, and there has been further discussion if you search some threads.

====================

Thanks Migrant - I'll search some more threads and when ready contact Sunbelt.

[floridaman]

[i was considering moving to Thaialnd for teaching but for 60000 baht per month, hey you have your first employee right here!!!

[pedro01]

Sorry, I left out too many details. The product would be loans(mostly secured) and the customers would be based in the US. I would move to Thailand to manage the office. We currently opperate in the San Fran area, where labor is far from cheap.

*Migrant - why is it easier for US based companies to setup operations in Thailand?

*How difficult would it be to hire quality ex pats with preferably a college education? During the startup phase I would only need 5-10 English speaking ex pats. The comp would be 60,000 bt base + bonuses(20k- 60k).

*Does anyone know of a company that could assist with the legal issues?

Amity treaty was set to expire last year, I'm not sure if it was renewed. I work for a US company but their parent is a large Japanese corporate. We couldn't go the Amity Treaty route BUT we did get something called an Alien Business License. You actually don't need to bother with either UNLESS you need the entity here to be 100% foreign owned. It sounds like you'll be operating a cost centre taking advantage of local labour rates (B60K being much cheaper than San Fran I guess), so it shouldn't need to be foreign owned.

To operate a cost centre here - you will need a decent accountant as the revenue department don't really like/understand companies here not making a profit. You aren't really selling a product, so transfer pricing rules don't really apply, it's a grey area for them, so you had better be prepared to make friends with them. I run a cost centre & basically massage a small profit - set up contracts with HQ & make sure we don't make too much of a paper profit. Do your contracts with HQ quarterly as this gives you 4 quarters in the year to make your adjustments. Stamp duty is payable (1% I think) on the total contract value and you need to do contracts on time or could pay a small fine. The fine is negotiable by the way - so if you find yourself in that situation - don't panic. You'll need a Thai who speaks great English and has a friendly personality to help you interface with the revenue department and you need to make friends with them.

You need to remember that there will be overhead per employee - office, accounting etc which needs to be factored into your costs. After these costs, it may not be so cheap.

The largest stumbling block is the amount of foreign staff you want to employ. When you get your own first work permit here, the Immigration Dept will put a not in that it will only be renewed if you have a certain number of Thai staff. Usually 4-7 depending on the officer & probably how well you present yourself This will apply to all successive work permits, so for your 5-10 foreign staff, you will need 20-40 Thai staff. What will they do ?

Sunbelt advertise on here and are supposed to be good. I personally use Chandler and Thong-Ek - I cannot recommend them highly enough. Years of experience in both Thai & US law, excellent staff and in 6 years - they have NEVER taken their eye off the ball. Do NOT scrimp on your lawyers - no one man shops, you need to have a legal TEAM on hand.

I hope this helps

Pedro

[think_too_mut]

*How difficult would it be to hire quality ex pats with preferably a college education? During the startup phase I would only need 5-10 English speaking ex pats. The comp would be 60,000 bt base + bonuses(20k- 60k).

Have you ever heard the expression "if you pay peanuts you'll get monkeys"?

It is 2000US$ + per month for a call centre job?

Do you pay that much in San Francisco for that kind of work?

[Dakhar]

If the job requires 5 days a week 8 hours a day.... sign me up. I'd gladly take a cut in pay for the better hours.

[siamamerican]

Pedro -

Thanks for all the valuable input. I agree that hiring cheap lawyers would be a mistake. I don't anticipate startup costs being an issue. I have a strong track record at the company I work at and I should be able to convince them that it would be a profitable endeavor.

You mentioned overhead being a detractor, but in my situation it actually fortifies the reasons to setup operations in Thailand. Overhead in San Fran is higher than almost any area in the US.

I don't have a solution to the requirement that you need to hire 4-7 Thais for each foreigner hired. That's where a good lawyer would help.

Thanks again for the advice.

[siamamerican]

If the job requires 5 days a week 8 hours a day.... sign me up. I'd gladly take a cut in pay for the better hours.

Are there other ex pats that have the same opinion? It would be a 30 - 45 hr a week job. The downside would be start times(2am - 4am). The office would be supporting sales originating on the west coast. Eventually I would hope to have a sales staff as well as support. The sales staff could assist borrwers that apply between between 8pm(10am Thai time) and 6am.

[siamamerican]

*How difficult would it be to hire quality ex pats with preferably a college education? During the startup phase I would only need 5-10 English speaking ex pats. The comp would be 60,000 bt base + bonuses(20k- 60k).

Have you ever heard the expression "if you pay peanuts you'll get monkeys"?

It is 2000US$ + per month for a call centre job?

Do you pay that much in San Francisco for that kind of work?

We pay roughly 3k a month for call center reps. I'm not looking to hire call center reps though. Our call center tranfers calls to loan sales consultants. After the the loan is sold and approved by underwriting, loan processors collect all the required docs to fund the loan. Loan processing is what I want to outsource.

[migrant]

I recently read where the Amity treaty was extended to early Dec.

siamamerican, I have many clients in the processing business, and some loan companies also (I am a CPA in Orange County). So you are looking for closers?

Your call center will forward leads to your Thailand staff? They will follow up with gathering info, terms, closing, etc?

I like the idea of outsourcing to Thailand. India is getting a lot, but the Thailand hours work. Just be carefull, starting your work day at 2-3am, too many bars closing at that time

[think_too_mut]

*How difficult would it be to hire quality ex pats with preferably a college education? During the startup phase I would only need 5-10 English speaking ex pats. The comp would be 60,000 bt base + bonuses(20k- 60k).

Have you ever heard the expression "if you pay peanuts you'll get monkeys"?

It is 2000US$ + per month for a call centre job?

Do you pay that much in San Francisco for that kind of work?

We pay roughly 3k a month for call center reps. I'm not looking to hire call center reps though. Our call center tranfers calls to loan sales consultants. After the the loan is sold and approved by underwriting, loan processors collect all the required docs to fund the loan. Loan processing is what I want to outsource.

My company runs 3 technical support centers in 3 different timezones, all in farangland.

For level 1 (still skilled work, they resolve 80% of the calls) cost per call is just under 100US$.

Staff are paid about 2500US$

An Indian outsourcer is offerening that same level of service for 22US$ per call.

Staff are paid 300-400US$ per month and are trained to speak English without Indian accent.

Maybe these numbers can help you with your calculations.

The number of calls we handle is close to half a million per year.

Edit: about 30% of the calls are voice initiated (customers call), the rest are automatic calls that still need attention.

Edited September 5, 2006 by think_too_mut

[pedro01]

Pedro -

Thanks for all the valuable input. I agree that hiring cheap lawyers would be a mistake. I don't anticipate startup costs being an issue. I have a strong track record at the company I work at and I should be able to convince them that it would be a profitable endeavor.

You mentioned overhead being a detractor, but in my situation it actually fortifies the reasons to setup operations in Thailand. Overhead in San Fran is higher than almost any area in the US.

I don't have a solution to the requirement that you need to hire 4-7 Thais for each foreigner hired. That's where a good lawyer would help.

Thanks again for the advice.

No problem.

I think you will find that it is impossible to get around those hiring requirements. I recently had an opportunity to employ 200 Japanese contractors out here IF I could find a company structure that could actually employ them.

I ended up talking to Supat Skonchai - he's a lawyer now but used to work as a senior immigration officer. He's very well connected in immigration and is one of the people that drafted the immigration laws. Lawyers from all over the country consult with Supat on immigration issues as well as immigration themselves. I offered Supat a slice of what would have been a very big pie but it just wasn't possible. This is one regulation which you cannot get around - you need to be employing Thais.

To be honest - if it's just 10 people you need - you will EASILY find qualified local staff here with perfect English. I have plenty working for me - they are well within reach of the salary range you mention.

[pedro01]

Supat can be found on his website... http://www.visathailand.com/ - no relation to this one !

[MattFS218]

India by far as the competative advantage in this area. I assume you sell mortgages and want people to cold call perspective clients and then setup a "meeting" with a loan officer.

I work in the IT industry and recently just finished setting up a team to cold call for networking equipment in India, and can tell you people in india who work the graveyard shift, speak english, make about 300 USD/mo. You might be able to find 10 people in Thailand who can speak good english, but less than 10% of those will work the graveyard shift.

Write a script, and do the accent training based on that specialized script. In India, if you want more competent people than just one who can read a script you might need to pay $1000+/mo...but it's still way less than the $5000 a similiar job in the States would cost.

[siamamerican]

I recently read where the Amity treaty was extended to early Dec.

siamamerican, I have many clients in the processing business, and some loan companies also (I am a CPA in Orange County). So you are looking for closers?

Your call center will forward leads to your Thailand staff? They will follow up with gathering info, terms, closing, etc?

I like the idea of outsourcing to Thailand. India is getting a lot, but the Thailand hours work. Just be carefull, starting your work day at 2-3am, too many bars closing at that time

Our call center in the US forwards calls to our US based sales. Initially I would be looking for processors to support the closers in the US. A processor with the desire and the right personality can move into a sales role in about 6 months to a year.

2-3am would be a problem, but I don't know how to avoid it. Starting at 8pm would work, but I think that would be harder to Staff.

Edited September 5, 2006 by siamamerican

[siamamerican]

India by far as the competative advantage in this area. I assume you sell mortgages and want people to cold call perspective clients and then setup a "meeting" with a loan officer.

I work in the IT industry and recently just finished setting up a team to cold call for networking equipment in India, and can tell you people in india who work the graveyard shift, speak english, make about 300 USD/mo. You might be able to find 10 people in Thailand who can speak good english, but less than 10% of those will work the graveyard shift.

Write a script, and do the accent training based on that specialized script. In India, if you want more competent people than just one who can read a script you might need to pay $1000+/mo...but it's still way less than the $5000 a similiar job in the States would cost.

==================

India hasn't worked for us. In the cold calling scenario you mentioned, India might suffice. We spend millions marketing every month so borrowers contact us looking for loan products. This is an expensive means of getting leads and you need a qualified sales person handling the transaction. For example, if application to fund conversion is 18% in the US and 16% in India, the US sales force would be more profitable. Drops in conversion erodes savings quickly.

Edited September 5, 2006 by siamamerican

[~G~]

You are looking for Native English speakers living in places where cost of living is cheap. Coming to Thailand means night shifts, which mean you need to pay some premium as a compensation.

Why not look for Expats at other regions, geograhically closer? South America, for example?

[mouse]

I don't have a solution to the requirement that you need to hire 4-7 Thais for each foreigner hired

Having just spoken to Sunbelt about forming an Amity type company for my own purposes, I was udner the impression that I would not need to hire any Thai citizens unless I wished or needed to do so.

Check with Sunbelt. Your call center idea would definitely work as you envision. You have an ample supply of native English speakers living here that could meet you requirements.

The Amity Treaty was renewed until 5 Dec 2006, however, it was also my understanding that this windows will close after that.

[MattFS218]

India hasn't worked for us. In the cold calling scenario you mentioned, India might suffice. We spend millions marketing every month so borrowers contact us looking for loan products. This is an expensive means of getting leads and you need a qualified sales person handling the transaction. For example, if application to fund conversion is 18% in the US and 16% in India, the US sales force would be more profitable. Drops in conversion erodes savings quickly.

Just curious, but did your company contract with a larger provider to support the service or did they go at it alone?

Did they fail on the sales side or the product knowledge side of closing the sale? Or was their english just too fustrating for most to understand. I'm in the middle of doing this enterprise-level sales program in India and would apperciate the advise.

--matt

[siamamerican]

India hasn't worked for us. In the cold calling scenario you mentioned, India might suffice. We spend millions marketing every month so borrowers contact us looking for loan products. This is an expensive means of getting leads and you need a qualified sales person handling the transaction. For example, if application to fund conversion is 18% in the US and 16% in India, the US sales force would be more profitable. Drops in conversion erodes savings quickly.

Just curious, but did your company contract with a larger provider to support the service or did they go at it alone?

Did they fail on the sales side or the product knowledge side of closing the sale? Or was their english just too fustrating for most to understand. I'm in the middle of doing this enterprise-level sales program in India and would apperciate the advise.

--matt

We used Wipro in India, but not for sales related activities. Philippines is where we tried sales. The India operation has performed well, but the Philippines has been, for the most part, a failure. We chose sales in the Philippines, because their English was less accented. I wasn't involved with the management of either operation.

It's my understanding that they both performed tasks well, but couldn't think outside the box. We had some success in the Philippines with our less complicated loan products. I think sales would work in both countries if the product is simple and the sales cycle short. It also helps if they are generating their own leads. If you are paying for leads and the leads are expensive, minimal conversion drops erode the cost savings.

Bob