Expats starting a service business in Bangkok face a myriad of challenges. There are obstacles when it comes to forming a company and getting operations off the ground. Then you have competition which is incredibly high. With that in mind, let’s go over the biggest mistake expats make when starting a service business in Bangkok and how it can be avoided.
Location, Location, Location
Regardless of if you are opening a restaurant, bar, café, dispensary, retail shop or any other type of service-focused business, you’ll need a space in Bangkok. For most expats, the focus is on those places where other foreigners and travelers tend to congregate.
Nana, Asoke and Khao San Road, among other locations. Unfortunately, space here is limited and expensive. Not everyone can afford this and even if you can, taking this kind of financial risk may not be palatable.
When an expat expands their search, attention usually turns to shophouses in Bangkok’s other popular locations, such as Sukhumvit Road and its many offshoots; Silom and Sathon; and even Lat Phrao.
The allure of the shophouse is obvious. They are really cool and offer a sense of authentic Bangkok. Whether you’re only taking up a floor or two or happen to be renting the entire building, envisioning your service business thriving in a Bangkok shophouse is easy for most folks.
The reality of starting your business in one of these is, however, much different.
Expats starting a service business in Bangkok must avoid this mistake
Opening your service business in a shophouse in Silom or along Thonglor or Ekkamai presents you with an immediate uphill climb to find customers. If you build it, they will come doesn’t apply in the Thai capital, even with its tens of millions of people and never-ending stream of visitors.
Sure, foot traffic will bring in some customers but rarely enough for your business to survive long term. This number also directly correlates with your proximity to public transit, office buildings and condominiums.
Your business may be able to find a niche with Bangkok’s expats who are willing to travel to your location in a shophouse. On the other hand, competition in this market segment is fierce and not everyone is willing to make the journey with so many other options available.
As for the domestic market, this presents a different issue. A lot of Thai customers want parking, something that most Bangkok shophouses can’t provide. A lack of parking is an immediate disqualifier for many locals.
For example, the location of a Bangkok shophouse on Sukhumvit 26 may seem reasonable on the surface. It’s a place everyone knows and, in theory, is easy to get to. Unfortunately, history has shown businesses here don’t thrive due to location alone, especially if the higher rent of being located in the city isn’t offset by foot traffic.
Understanding this, let’s look at how expats starting a service business in Bangkok can find success.
Create experiences & marketing
It’s important to state that you can find success for your service business in a Bangkok shophouse. But before signing a lease, you must ask yourself a fundamental question: why should someone come here?
If your answer is to eat food, drink drinks, buy products or something similar, well, you won’t last. That’s just the truth of the matter. There are numerous companies just like yours, who probably did it better, that failed because of this mindset.
Instead, you need to focus on creating an experience. There needs to be a reason people in Bangkok must patronize your business regardless of the inconvenience involved. This can be a cool design, a curated ambiance or something else that resonates with customers.
What I recommend doing is exploring Bangkok, finding businesses that are similar to what you want to do, taking stock of what makes them successful and figuring out how you can do something different.
The second thing you need to invest in is marketing. No one is going to seek your business out without marketing in all its forms. When you are open, get good photographs, get good videos, produce content and showcase that can’t miss experience.
Sure, this isn’t easy and costs money, but it is the only way a larger number of people will find you in Bangkok. As I’ve said several times already, competition is relentless here. No one will notice what you’re doing if you are just a grain of sand on the beach.
Additionally, these marketing efforts are also significant should you want to tap into the delivery market via apps like Grab and Food Panda. Building awareness is invaluable.
Also Interesting: Do expats really need a will made in Thailand?
Location hacks
Some of you may be turned off by opening a business in a Bangkok shophouse along a major street after hearing all this. Fair enough but there are a few hacks worth considering.
First, look for smaller streets off one of the branches of Sukhumvit. What you are after here are locations where street parking is available or that have a nearby condominium that has parking you can rent. This can be a shophouse or even a detached house. Lots of businesses have found success in these spots which may not have been possible elsewhere.
Second, don’t be afraid of the suburbs. There is a lot of money in Bangna, for example. You have Nichada Thani as a major expat-style housing estate that is basically its own city. It is surprising for some to see the expat-owned or focused businesses now enjoying success in these places because the competition is much less.
Now, not every business will work in the suburbs. Again, you need to go out and understand the market, where you’ll fit in and get your price points right. Ultimately, it’s all about finding the best opportunity for your business and that may not be in a Bangkok shophouse.
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