• Thailand Market Entry Guide: An Overview

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    Thailand’s eCommerce market is growing at a rapid pace and increasingly more foreign brands want to enter the market. Along with digitization and urbanization, the rise of its eCommerce market has been prevalent recently.

    Entering the market can be challenging though, especially if you have no or limited experience of doing business here. In this article, we explain the basics and what you must pay attention to when entering the Thai market.

    Topics covered:

    • Market Entry Strategy
    • Thailand Market Obstacles
    • Market Entry Research
    • Incorporation

    Market Entry Strategy

    Market entries can differ significantly depending on the sales goals of a firm, entry barriers, the level of commitment, and competition. Some firms just want to test new markets while others see great room for expansion.

    In short, market entries can typically be done in three different ways, through initial marketing campaigns, by selling cross-border on eCommerce websites, and by domestic operations. Let’s have a look at each option.

    Initial Marketing Campaigns

    Initial marketing campaigns are managed for brands to test or warm-up new markets. Decathlon is a prime example of this and how they entered the Vietnamese market in 2021. Before the store opened, students were riding bicycles in long lines carrying Decathlon flags.

    You could also see advertisements on escalators, as well as on the building where the store is located. While Decathlon didn’t just want to test the market, their goal was to warm up the market prior to the entry.

    In recent years, the power of working with local key opinion leaders, vloggers, and celebrities has also become evident. This is something we see in other countries as well, particularly in China.

    If you plan to do initial marketing campaigns and have limited experience in the Thai market, it can be worthwhile working with local eCommerce and marketing agencies.

    Cross-Border eCommerce

    ASEAN comprises six countries and a popular option is to sell cross-border on eCommerce marketplaces. This option will grow in the future and as the appetite for foreign products increases.

    Compared to China, cross-border isn’t as big, but the Thai market has great room for expansion.

    Lazada and Shopee are two of the most popular eCommerce marketplaces here, where the first one focuses more on cross-border sales. Just keep in mind that buyers generally prefer to buy from local sellers, but you’ll get access to more markets by selling cross-border.

    Lazada’s fulfillment center is located in Hong Kong, allowing you to close your stores and sell in all ASEAN countries. The region has a population of 600 million and is set to grow dramatically in the coming decades.

    Domestic eCommerce Operation

    The third option is to import the products into Thailand and sell them through domestic eCommerce channels. This will help you to reduce shipping lead times and costs. Yet keep in mind that you have to import the products first.

    As such, you must open a local entity, acting as an importer, or work with a local import agent.

    Stricter demands for product labeling and registrations apply. This option is suitable if you want to maximize sales by selling offline and online. You could also sell on cross-border eCommerce sites at the same time, to increase sales further.

    A drawback of selling domestically in ASEAN is that you must deal with many countries, managing registrations, and translations in several countries. This is one of the reasons why many sellers decide to start with cross-border eCommerce operations at a start.

    Thailand Market Entry Obstacles

    Entering the Thai market comes with challenges and obstacles. It’s a developing country where service providers and authorities speak limited English. Besides, exporters will deal with local product and labeling standards.

    Below I have summarized some of the main market entry obstacles that are worth paying attention to beforehand.


    Sellers have to pay import duties that differ depending on the products and your country of manufacturing. A value-added tax of 10% is also imposed on goods sold (temporarily reduced to 7% until September 2021).

    Most-favored-nations (MFN) can also enjoy rates less than 5% for a third of products and 30% of products are duty-free. Import duties are competitive with the exception of products like cars, motorcycles, and distilled spirits, for example.

    Setup Costs

    Exporters that plan to set up a local company should also know that this comes with certain challenges and costs. Yet this is an attractive option for companies that want to create a long-lasting presence in the country.

    I will cover this topic later in the article.

    Product Standards & Labeling Requirements

    Many products require labeling in the Thai language. Product standards and labeling requirements are similar to US and EU standards to some extent, but also different. For instance, while the CE mark is used in the EU, Thailand has the TISI Mark.

    The Thailand Industrial Standards Institute is responsible for product regulations and the issuance of the TISI Mark. It comes in both a mandatory form (red color) and voluntary (blue color).

    Below you can find additional examples of labeling requirements.

    Example A: Food Labeling

    The Thai Food and Drug Administration is responsible for the approval of food labels. The authority is also responsible for the issuance of new regulations. Examples of information that must be included on food labels is:

    • Product name
    • Net weight/volume
    • Production and expiration dates
    • Product registration number
    • Name and address of the manufacturer

    All products except for alcohol need labels in the Thai language.

    Example B: Eco Labeling

    The Green Label is used as an environmental certification for products that are proven to have a minimal detrimental impact on the environment, in comparison with other products. The label is used for products except for food, drinks, and pharmaceuticals.

    Market Entry Research

    Before entering the Thai market, you must do sufficient market entry research to understand costs and competition. Most companies need hand-holding and support from local service providers, but there’s also much you can do on your own. Below are some examples.

    Marketplace Research

    Thailand has a handful of eCommerce websites and where the most popular are Lazada and Shopee. Both the websites accept cross-border sellers, but Lazada has more developed cross-border capabilities so far.

    If you plan to sell cross-border, you must confirm what websites that accept cross-border sellers first. The payment methods are equally important to assure swift and timely payments.

    Lazada works with both Payoneer and World First, for instance, which is beneficial.

    Other items to confirm include return policies and what kinds of buyers use the platform, for instance.


    As mentioned, Lazada is the number one eCommerce website in Thailand and is available in most ASEAN countries. The only exceptions are Brunei and Cambodia. Lazada is owned by Alibaba Group and has grown significantly since its launch in 2012.

    Getting started on Lazada is easy, especially if you’re a cross-border seller. The setup fees are minuscule and in the hundreds of dollars. You can also hire Lazada Partners to manage the store setup and management for you.

    The only drawback of selling cross-border on Lazada at the moment is the product restrictions. Food, beverages, and health supplements are prohibited, for instance.

    I recommend you check Lazada.co.th for a better overview of the product assortment available. You can also find information about competitors and pricing.


    Shopee is partially owned by Tencent, a major competitor to Alibaba Group, and with much backing. Many Asian shoppers prefer Shopee thanks to its quick and low shipping costs. A drawback is only that the website has less developed cross-border solutions.

    For instance, while Lazada encourages all users to select its in-house fulfillment and shipping solutions, Shopee only allows certain sellers to do so.

    The product assortment is not as big compared to Lazada either. Having said that, Shopee continues to grow and will remain a strong player for the unforeseeable future.

    Setup Costs

    Setup costs can be exceptionally high if you include the initial marketing fees. The lower the brand awareness, the more money and time to be spent on increasing local brand awareness.

    The setup costs will also differ depending on your level of commitment, goals, and what sales channel you use. Setup costs can include fees for incorporation, shipping, marketplaces, import tariffs, and hiring service providers.

    In comparison to China, setup fees are generally lower in Southeast Asian countries and the markets less competitive as well.

    Competitor Cost Analysis Research

    You can manage competitor cost analysis with the help of local service providers and basic analysis on your own. As mentioned, one of the easiest options to get a basic understanding is to visit the above-mentioned marketplaces.

    If you want information about competitors and pricing, you can also visit local stores. This will help you understand what products are available offline and the prices charged.

    Shipping & Logistics

    The sales channel used will also determine how you ship and fulfillment the products. Lazada, for instance, uses a centralized warehouse in Hong Kong for its cross-border operations in Southeast Asia.

    One drawback of stocking and shipping the products from Hong Kong is the rather high fees for bulkier products. If you plan to import and sell the products domestically, it’s preferred to stock the products in Thailand, which will reduce shipping lead times and costs.


    Many sellers decide to incorporate in Thailand to manage imports, fulfillment, and being able to sell offline. Setting up a company here isn’t as straightforward nor easy as in Hong Kong, for instance.

    General Requirements

    Below you can find the general requirements when opening an LLC in Thailand, which is one of the most popular company structures. Keep in mind that additional requirements might apply and you should consult with a company formation agent.

    • 3 shareholders
    • 1 director
    • Share capital USD 1 for majority Thai owned company
    • Typically 51% ownership of Thai citizens

    Keep in mind that Amity Treaty LLCs can be owned 100% by Americans, thanks to the Treaty of Amity and Economic Relations Between the Kingdom of Thailand and the United States of America.


    The following documents and information are generally needed. Consult with your company formation partner if additional documents or information are required.

    • Company name
    • Brief description of business activities
    • Copy of passport/ID card of director and shareholders with signed
    • Copy of passport/ID of every promoter(s) with signed
    • Copy of passport/ID card of 2 witnesses with signed
    • Office evidence
    • Bank certificate (for Thai shareholders)
  • (USA & EU)

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    Disclaimer: The content on this website is provided for general information about exporting products to Asia, e-commerce platforms, logistics, regulations, taxes, and other related topics. However, we don't guarantee that we keep the content up to date or that it's free from error. We do make mistakes from time to time. We never provide legal advice of any sort.
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