Franchise Ventures Seeing Rapid Growth in Thailand

 

BANGKOK – Thailand’s franchising business is thriving, with more than 50 food and services chains planning to explore opportunities in Thailand this year, says a franchise consultancy.

Sethaphong Phadungpisuth, managing director of Gnosis Co, said those chains are from both local and international brands. Most of them are in the food, beverage, learning centre and cleaning sectors.

Thanks to efforts by the Business Development Department to ease new business registration regulations, the number of entrepreneurs who want to build their business via a franchise basis in Thailand continues to increase every year.

Thailand also remains an important destination for international franchise business, particularly from the US and Asean countries.

International franchises that came to Thailand for business matching events with Thai investors in the last quarter of last year included Bingirl restaurant and Cha Ji Tang drink from Taiwan; Fidele, a seafood chain from the US; Presotea, Australia’s premium tea; The Belgian Waffle Co; Yang Xiang, a Hong Kong food brand; Sureclean from Singapore; and The Edge Learning Center from Hong Kong.

Previous overseas franchise brands that looked for franchisees in Thailand included Little Caesars Pizza, Denny’s, Buffalo Wild Wings, Mosquito Squad, The Boiling Crab, and Tapout Fitness from the US; Little Sheep Mongolian Hot Pot from China; and Brotzeit German Bier Bar & Restaurant from Singapore.

Gnosis said several brands choose Thailand as a springboard to other Asean countries, particularly Myanmar and Laos.

Franchise brands scheduled to start their business in Thailand this year include Taco Bell, an American fast food chain that is a subsidiary of Yum! Brands; The Edge Learning Center from Hong Kong; and Sureclean Pte Ltd, Asean’s leading supplier of hygiene and disinfection products and services from Singapore.

“The franchise market in Thailand will become more active this year. We expect the overall number of new franchise brands both from abroad and the domestic market that will open their franchise in Thailand this year to increase by 10% to about 630 brands,” said Mr Sethaphong.

Both the US and Taiwanese brands will resume their expansion in the Thai market, he said.

“The popularity of Taiwanese milk tea chains continues to increase in Thailand after more Thais travelled to Taiwan in the past few years,” said Mr Sethaphong.

In 2018, The Alley, a Taiwanese milk tea chain, opened in Thailand.

Franchise business in Thailand is estimated to be worth 250-300 billion baht.

The value remains far behind that of Thailand’s retail market, which is estimated at 3.6 trillion baht, meaning there is huge opportunity for growth.

Mr Sethaphong said Thai food brands are also seeking to open franchises overseas.

Gnosis is scheduled to host International Franchise Soul 2019 during March 7-9 for Thai companies interested in overseas expansion opportunities.

Basil Thai Kitchen, a contemporary casual Thai-style restaurant owned by Minor Group, is one local chain keen on exploring opportunities abroad.

By Pitsinee Jitpleecheep