Austrade: Bangkok

Austrade Bangkok business development manager Asa Chotchakornpant offers the low down on the Thailand TCF market.

What you need to know
Western influence through increasing tourist numbers and expats, and the growing affluence of Thailand's middle class of 20 million (almost equal to the total Australian population), are having a significant impact on the Thai fashion market and creating more opportunities of Australian brands.

Retail trade in Thailand is expanding rapidly, with over 44 high-end department stores and western style shopping malls around the country, with 21 in Bangkok alone - Siam Paragon, Central and Robinsons increasingly stock high-end fashion labels. Thai consumers are increasingly 'brand conscious' and are aware of international fashion trends, preferring brands that help improve their social status.

Gaps in the market
Thailand is a market dominated by US and European brands. However, Australian fashion, originally known for beachwear and street wear, are enjoying growing recognition and market share, particularly high-end brands and luxury labels. Bettina Liano, Ksubi, Tigerlilly, Manning Cartel, Zimmerman and Natasha are some of the Australian labels popular in the Thai market. Australian companies have a unique competitive advantage over their US and European counterparts because of the Thailand-Australia Free Trade Agreement (TAFTA), which brought import tariffs on fashion, apparel and accessories down from 60 per cent to 8 per cent in 2008. Australia exported $A1 million worth of apparel to Thailand in the last financial year -a figure that is expected to grow strongly due to benefits from cheaper import duties under TAFTA. 

Dealing with trade
Designers should take into consideration the size differences for Thais and Australians. Importers look for sizes six to ten.  Seasonal differences should also considered. Buying periods tend to follow European seasons, but as Australian fashion is counter seasonal, this could be an advantage. Also 'transeasonal' apparel are better suited to Thailand's warmer weather --Thailand enjoys a mild winter of about 20 degrees.

Australian designers should bear in mind that local design is of good quality and reasonable price. However, there is a strong market for innovative and unique labels. Having an international reputation is also an added advantage. Some international labels have gained price competitiveness by manufacturing in Thailand for the local market.

Aspiring exporters should do their homework. A solid awareness of Thai culture and recognition that the cultural barrier may extend beyond language (yes may mean no) is essential. Relationships are the key to long term export success. Finding the right partner and building a sound partnership with a local importer makes a huge difference when navigating bureaucracy, which is part of the business norm. Ability to meet market demand is also crucial as this impacts relationship with importers.  Austrade can provide market support and help find the right partner for your business.

By Asa Chotchakornpant