How to Start Food Business in Thailand?

 

Are you aspiring to start a food business in Thailand? Then this article is going to be your super guide in the process. Due to the huge influx of visitors to Thailand, many global entrepreneurs invest in the Thai food industry. A foreign investor must adhere to Thai law’s regulations for business registration. Additionally, they should focus on consumer protection to create a business that sells food.

However, this article aims to guide you through the 3 most easy ways to start your food business in Thailand. 

First Easy Way to Start a Food Business in Thailand: Focus on Natural Resources

You must note that the food business is not only restricted to cafes and restaurants. Now is the high time to break free from this concept. Setting up a cafe, restaurant, pub, food truck or trailer never means doing food business in Thailand exclusively. They are simply a part of the food industry of Thailand and never denote the whole of it.

Thailand is often referred to as the “Food Valley of the World” due to its abundance of agricultural resources. Furthermore, Thailand holds a huge reserve of livestock and marine life. It’s noteworthy, that the kingdom holds high global ranks in terms of stock and export of these commodities.

Now would the kingdom ever want to lose this leading status in the world? Never!

Therefore, the Royal Thai Government in association with the Board of Investment facilitates the process of ease in starting a food business in this segment. It is to promote the involvement of Thai and foreign investors to boost Thailand’s position in global rankings. 

Food Processing Company

Processed foods contribute to almost 52% of Thai food exports and 15% of Thai manufacturing exports. Additionally, this year till June, the kingdom has already exported products worth US$ 45 billion. Aren’t the figures inspiring enough to start a food processing company in Thailand? 

The food processing industry in Thailand has various segments and verticals. To narrow down your scope of market research let us give you some hints.

Your business can specialize in either moderately processed or highly processed foods. Both these segments have vividly different consumer bases, which are remarkably huge respectively. Moderately processed foods refer to food items subject to canning, freeze-drying, and other preservation techniques. Whereas, highly processed foods are ready-to-eat meals, convenient meats, and meat and vegetable products. Additionally, there is a big local and export market for processed halal foods in Thailand. 

The market is promising with guaranteed growth. If you are not convinced enough, you may proceed to start your restaurant in Thailand.

Food Seasoning Company

The abundance of agricultural and raw materials in Thailand along with the availability of trained manpower is gradually reinforcing the kingdom as one of the leading food seasoning ingredient exporters. According to the Board of Investment of Thailand, the kingdom is the world’s sixth-largest exporter of food seasoning and flavoring ingredients with Australia, Philippines, Indonesia, Japan, and Malaysia as the primary export destinations.

Additionally, the local need for food seasoning ingredients is also increasing due to the boom in the Thai hospitality industry post-COVID. Therefore, even if you are not opening a restaurant or cafe, you are going to cater to their requirements.

Beverages

In the current fiscal till May 2023, the revenue generated in the Thai beverage market is almost US$1200 million. Isn’t this aspiring?

The Thai beverage market assures a CAGR of 5.2% with high demand for functional drinks and fruit juices. Additionally, Thai consumers are always in search of new and sophisticated flavors of functional drinks. This market tendency is going to give you as an investor a great scope to research and expand.

Trading Centres

This is another thriving market in Thailand. You can set up cold storage, silos and involve your business in trade and auction of agriculture products. Additionally, you can also launch digital platforms to accomplish the said objectives. Your business can also provide a platform to service farmers and business operators and a system to monitor and control the quality of agricultural products. 

Now you may ask where’s the ease? The ease is in the process of incorporating these food business units. Additionally, you can also access various alternative ways to reduce the stringency in the process, provided, you have a reliable Thai corporate lawyer by your side. Also, note that the process of registering these business units requires relatively less collateral than starting a restaurant, cafe, food truck, or stall in Thailand.

Second Easy Way to Start a Food Business in Thailand: Focus on BOI & Thai Government Incentives

If you have gone through the previous section, you may think that we talked mostly about the food manufacturing and processing business. That’s true, but, these business activities fall in the BOI-eligible bracket. Nonetheless, being in the food industry, you will target the manufacturing segment and can bag tax and non-tax benefits from the Board of Investment of Thailand.

If your food business project complies well with the BOI eligibility criteria, you will start getting the following benefits from the time you start thinking about the incorporation:

• Ease in the Thai Company Registration Process.
• No restriction in bringing in foreign skilled workers in Thailand.
• High probability of gaining 100% foreign ownership of the planned business. (In other cases, you will need to have a Thai partner holding 51% of the share of your business.)
• Exemption in the VAT and excise tax associated with the import of machinery in Thailand from your native or preferred nation.
• Become eligible for incentives on the investment in the project.

Apart from these basic benefits, you will also be eligible for other tax and non-tax benefits which, although not restricted to, primarily focus on the following:

• Corporate Income Tax exemption of up to 13 years.
• Gain a 100% tax deduction on utility bills generated in operating your business in Thailand.      
• Receive tax and non-tax benefits in expanding your business in Thailand.
• Some promoted activities receive a reduction in withholding tax rates on dividends paid to foreign investors or companies.
• Certain expenses incurred by BOI-promoted companies, such as research and development, human resource development, and transportation costs, can be double deducted when calculating taxable income.
• BOI-promoted companies are allowed to carry forward losses for up to five years, which can be deducted from future profits.

Aren’t these going to make the process of setting up and operating your food business easy in Thailand? 

Your cafe and restaurant business may give you margin, but the said lines of business will surely grant you greater ease in operating your business. Additionally, you can also enjoy greater business authority.

However, if still you are unable to think of anything else than a restaurant in Thailand, here is the cost of starting a restaurant in Thailand.

Third Easy Way to Start a Food Business in Thailand: Consult a Professional Thai Corporate Law Firm

Irrespective of the fact as whether you are a Thai or foreign investor, you must have a professional corporate law firm by your side to start your food business easily in Thailand. The primary reason is getting fool-proof procedural guidance, followed by other documentation and application-support benefits.

We understand that to start your business in Thailand, you might either be in the thinking phase or may have started making the preparations for the same. Irrespective of the phase you are in, we have solutions for you. Email us your business plan at officer@konradlegal.com and go for a consultation with our team of corporate law professionals. Not only would you get the best advice, but, we will surely make your process to start a food business in Thailand – EASY!

What is the Fees for Food License in Thailand?

 

In addition to being a tourism hotspot, Thailand is also popular as a foodie’s paradise. Every year the kingdom witnesses a great footfall of tourists and business owners. Apart from these visitors, Thai citizens are also food fanatics and love to taste different cuisines of different ethnicities. These facts have inspired many business owners to start their food business in Thailand. If similar is your plan, along with the process, this article will also guide you on the food license fees in Thailand.

Basic Guidelines on Food License in Thailand

In Thailand, a food license, often referred to as a “food establishment license” or “food business license,” is a legal permit. It allows individuals or businesses to prepare, sell, or distribute food products to the public. This license is essential to ensure that food businesses meet certain hygiene and safety standards, protecting the health of consumers.

Types of Food Licenses

The specific type of food license you need can vary depending on the nature of your food business. Common categories include a restaurant license, street food vendor license, food production license, and more.

Regulatory Authority

The Food and Drug Administration (FDA) in Thailand is responsible for regulating food licenses and ensuring that food businesses comply with food safety regulations.

Application Process

To obtain a food license in Thailand, you typically need to submit an application to the local FDA office or the relevant authority in your area. The application process may require you to provide information about your business, food safety measures, and the location of your establishment.

After submitting your application, your food establishment will likely undergo inspections by health officials to ensure compliance with food safety standards. This may include checks on cleanliness, food storage, handling practices, and more.

Penalties for Non-Compliance

Operating a food business without the necessary license or violating food safety regulations can lead to penalties, fines, or even closure of the establishment.

Food Safety Standards

The Food Act B.E. 2522(1979) is the primary law governing all foods in Thailand. It gives the government and officials the power to regulate domestic food production, as well as the imports and exports of food goods for retail sale. It also specifies the requirements and penalties for food businesses in Thailand.

Food License Fees in Thailand

The government fees for food license depends primarily on the area of your business premises that you will use to cook and serve/sell food to customers. On the basis of the area of your business, the food license fee slab is as follows:

• Up to 10 square meters: 100 THB
  • Additional 5 THB per square meter for more than 10 square meters
• Between 200 and 300 square meters: 2,000 THB
  • Additional 5 THB per square meter for more than 300 square meters

However, the government fee is limited to 3,000 THB. This limit is likely a regulatory decision made by the Thai government to promote small and medium-sized businesses and to make it more affordable for them to obtain the necessary licenses to operate in the food industry.

So are you planning to start your restaurant in Thailand? If yes, then you must check whether you have the following documents.

Documents Necessary to Obtain Food License in Thailand

• The company’s affidavit (not older than six months)
• House registration of the building.
• Original consent letter or a copy of the lease agreement (affixed with a duty stamp)
• The copy of the ID card and house registration of the director of the company.
• The copy of the ID card and house registration of the owner of the business.
• Power of Attorney
• Signed and completed application form (SorAor1)
• Map of the location of the business (restaurant)
• Printed photos of the front and inside of the business (restaurant)
• Interior plan (layout) of the restaurant marking a sitting place, kitchen space, and other sections.
• Measurement of the whole restaurant in square meters including tables, kitchen, counter, etc.
• Documents to prove the ownership, such as the sale and purchase agreement, a title deed, or construction permit.

From the document requirement, you can understand that before getting your food license, you have to register your business in Thailand. Documents like the affidavit, power of attorney, and proof of business ownership mandate you to have a registered business in Thailand. 

Be it registering your company or obtaining your food license in Thailand, feel free to email us at officer@konradlegal.com. We will start with a free email consultation and, henceforth, we will assist you throughout the process with our elegant services till you achieve success.