Sunbelt Asia Weekly Column
24 August 2018
Research by Hotels.com shows that young Chinese travelers are fueling a boom in independent travel and experience-based tourism as more and more shun large tour groups and prefer to taste exotic local delicacies (69 percent) and shopping at local markets authentic local items (43 percent) to shopping for luxury items (38 per cent). More than one third (37 percent) of travelers still plan to visit countries they have been to before but will go to different cities as they seek new authentic local experiences. Thailand remains attractive for its welcoming aspect due to the widespread acceptance of Chinese mobile wallets, signage in Chinese, and ease of information.
Customs cleared exports grew for the 17th straight month, reaching a seven-year high reaching 8.3 percent year-on-year in July, valued at 662 billion baht, this after growing 8.2 percent in June and 11.4 percent in May. The Middle East and the United States were the only two markets that didn’t show growth while exports to Asean, India, South Asia, Russia and the Commonwealth of Independent States (CIS) and Japan all saw double digit growth. Trade with Thailand’s Free Trade Agreement partners, Asean, China, Japan, Australia and India, grew 14.2 percent. Agricultural products grew 3.2 percent overall with strong growth in sugar peaking at over 41 percent, canned tuna at 21 percent, oil related products over 36 percent and automobile and computer products grew by over 11 percent each. In the first seven months of 2018 exports grew 10.6 percent with a total value of US$146.23 billion. Despite the trade conflicts between China and the National Economic and Social Development Board (NESDB) predicts exports will grow 10 percent in 2018.
The Foreign Trade Department launched eleven digital services to make export and import easier for businesses and reduce processing times and costs. The services launched include e-Register, which lets importers and exporters ask for a license via the electronic system; Rules of Origin Verification Systems, which verify the rules of origin for export and import goods that are entitled to privileges under FTAs or the GSP. Other services include e-CO, which provides Rules of Origin certification for products under FTAs or GSP, the rules of origin database and details of customs tariffs under Asean FTAs and trading partners, and the e-license which offers license and certification for export and import goods via the electronic system. The new digital service also offers electronic linkage to the National Single Window (NSW), a customs portal that pools the import license approvals for all 33 related agencies in a single place.
The Customs Department announced plans to introduce a digital payment system for small packages valued at over 1500 baht, previously packages that were valued at more than 1500 baht required the recipient to travel to Laksi Post Office to pay the duty and pick up the package. The new system, which the implementation date has not yet been given, will allow recipients to pay online and then the package will be delivered by the Post Office. Packages valued at less than 1500 baht do not require any duty to be paid. The Customs Department will be x-raying packages to ensure senders do not falsify values and also screen for illegal substances. The Customs Department plans on going after to vendors who falsify values, by developing a big data system to scrutinize importers that have suspicious behavior related to avoiding tax payments. Those who make false declarations will have to settle their cases in court rather than with the Customs Department officials.
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Unique concept retail store with branches around Thailand and in Cambodia
This unique and fun concept retail store has expanded rapidly and now has 39 branches around Thailand and in Cambodia. The stores are a destination and always have something new and fun to explore attracting locals and tourists. Offering low priced fashion products and unique gifts that resonate with tourists and residents, the owners of this store have found that their success has outstripped their ability to manage the business. The company sources their products direct from the factory both locally and around the region. With an ever-changing trendy offering of fun products, the company has created a popular and well-known brand image.
The business has 39 locations of which one is the headquarters and warehouse in Min Buri, and a company owned store in a popular tourist district as well as one licensed store. Total rent and services on these locations is around 5 million baht a month. There is 188 staff with a total monthly payroll of 3.17 million baht. Annual sales reach 344 million baht giving a profit of 38 million baht. Inventory valued at 100 million baht is included in the sale.
The company is debt-free would offer the new owner a good income, but this is ideal for someone seeking to grow the business through franchising and owner-operated stores as the retail concept has proven to be quite popular.
ASKING PRICE: 180 Million baht
Large hostel near Terminal 21
In a prime location near Terminal 21 and the BTS and MRT stations, this 21-room hostel is set in 3 commercial buildings and can hold 102 people. There are five floors including the rooftop in each building. With five private rooms and dorm rooms with bunk beds, each building is equipped with lockers and separate male and female shower rooms and toilets. Every room is air conditioned and there is WiFi on each floor. There is also a rooftop water tank ensuring a steady supply of water. There is also a Southern Thai restaurant on the ground floor with a chef who is willing to stay on and work the restaurant.
The business has contracts with Agoda, Booking.com, HostelWorld, Airbnb, Expedia, Traveloka and other booking sites. The rent on the entire property is 270,000 baht a month and a 9 year lease contract. The owner invested around 16 million in the business. All equipment, fixtures, and fittings are included in the sale including televisions, computer systems and restaurant equipment.
The owner is moving and so needs to sell the business.
ASKING PRICE: 15 million baht
Restaurant on ground floor of hotel in busy Asoke area
Just off Asoke Montri Road and near Terminal 21, Health Land and many office buildings and hotels this restaurant is on the ground floor of a hotel and has a booming lunch trade and is very popular with the locals in the area as well as tourists.
The restaurant can seat 85 people comfortably and a classically decorated private ventilated cigar room or VIP room. There are 7 full time staff with excellent team work, and food and beverage contracts with the hotel in the same building or provide breakfast service and room service offering a guaranteed income every month.
There is a cool room which stores wine and beer kegs, new kitchen equipment including charcoal grill, wok stove, oven, deep fryers, cooker, refrigerators, and freezers included in the sale price. Rent on the 280 sqm space runs 155,000 a month with no key money. The lease runs until 2022 with a fixed rate. All construction maintenance is supplied and paid for by the hotel above. The website, email, Instagram, Facebook page (15k followers) are all included in the sale.
Total income is around 400,000 – 500,000 baht a month but can go higher with an owner with more time to spare for the business. The owner doesn’t have time to manage the business and so is looking to sell the business.
ASKING PRICE: 2.9 million baht
Logistic and supply chain software business seeks partners to expand business internationally
This leading specialist software provider is seeking investors to expand the business. Providing logistics and supply chain businesses with key software in Thailand, India, Malaysia and Indonesia for the past 12 years, the company is looking to expand further into Thailand and a total of eight countries and is seeking a committed investor to fund the centralized team that will manage the expansion The company already has joint venture partners in every country show share 49% – 50% in those countries. By the end of 2017 the company should be operation in 8 – 10 countries.
They are seeking a 49% investor for 122.5 million baht
ASKING PRICE: 122.5 million baht for 49% shares
Online health food store with Sukhumvit showroom
This health store offers both online shopping for wholesome and organic products but also a showroom in a great Sukhumvit location. Taking advantage of the growing trend for healthy food, this online business also gives an opening into the booming e-commerce section in Thailand. The business has been in operation since 2013 and has seen business grow with sales reaching 8.8. million baht.
The showroom has parking for 3 cars and is in a top Sukhuvmit location with a rent of 30,000 baht a month. There are 7 full time employees with a payroll of 100,000 baht a month. The business is working on launching a new interactive site and mobile site.
The owner is looking to exit and start something else.
ASKING PRICE: 2.5 million baht
Restaurant & bar in busy Sukhumvit soi
This restaurant and bar is in a great location on Sukhumvit soi 31, a busy soi with many hotels and guesthouses and has earned a great reputation for its food and ambiance, even winning a restaurant award in 2015.
The restaurant has 200 sqm and a good rental price of only 45,000 baht a month. There are 7 full time and 7 part time staff with a total monthly salary of 145,000 baht. Annual sales are around 12-14 million baht and the business made a net profit of 4.6 million baht last year.
The owner is selling the business as he has no time to manage it.
ASKING PRICE; 6.5 million baht
Resort with lake and freehold land in Cha-am
Set in the beautiful district of Ch-Am and just a short drive from the beach, this business offers a unique opportunity for a buyer interested in getting into the resort and development business in a tropical paradise and owning 25 rai of chanote title land as well. There are 9 beautifully furnished villas, each offering two rooms for rent as resort style accommodation. The resort can cater for up to 40 people at a time. The 9 villas offer beautiful views of the mountains, lake and rice paddies near by. With such a large area, there is plenty of room to grow this business, either with more resort rooms or more villas. The resort has a large pool set in beautifully landscaped gardens and a lovely lake.
There are 15 employees with a total monthly payroll of 260,000 baht. Sales have grown continuously in the first four years of business as the place becomes more well known, reaching 24 million million baht in 2017 with a gross profit in excess of 10 million baht.
Twenty five rai of freehold land is included in the sale, along with a 240sqm meter clubhouse, dining and drinking area with 40 covers, and 14 hardwood salas, as well as staff quarters for 4 people.
The owner is looking to sell due to personal reasons
ASKING PRICE: 100 million negotiable
Beach resort on Samui island with chanote land
Have you always wanted to live the life in paradise? Now is your chance! This exclusive luxury resort has direct access to the beach on the peaceful and idyllic west coast of Koh Samui. Samui has developed a reputation for top luxury resorts that attract people from around the world.
Established in 2008, the resort has two villas and four apartments, a pool and a large private home, guest villa and gym. The total land area is 3200 sqm fronting the beach with a full chanote title for the new owner.
The villas are large, at 118 sqm each, while the four apartments are 32 sqm each. The private mansion is an enormous 760 sqm while the guest villa is 75 sqm. There is a fully fitted 75 sqm gym as well.
Sales last year reached 3.8 million baht and there are four full time employees. The valuation of this project has been set at 195 million baht but the owners are keen to move off island for their children’s education so are selling it at a must buy price of 150 million baht.
ASKING PRICE: 150 million baht