What Do You Need to Do to Open An International Restaurant in Thailand?
Lately, we’ve been seeing a lot of news about famous restaurant brand purchases in addition to importing international restaurant brands to be launched in Thailand. Many of these international brands get customers as soon as they open, and some customers are even willing to wait in long lines for 4-5 hours. That’s because most of these international brands are well-known among gastronomists and tourists. In short, these brands already have a customer base waiting for them.
So, what if some entrepreneurs want to launch some international restaurant brands in Thailand? What do they have to do? We offer some guidelines below.
For anyone interested in opening an international restaurant brand in Thailand, two main options are currently available:
- Buying a franchise.
- Buying a license.
The differences between franchises and licenses are as follows:
A franchise is a full-set acquisition of rights. This means you get the entire system or the full business model. You get all the brands, products, work systems, marketing assistance and personnel assistance and support.
On the other hand, licensing means the purchase of concession rights for specific business aspects such as brands and products. Whether or not the work system is given to you or you have to implement your own system depends on your agreement. Accordingly, you have to pay contract remunerations in line with agreement conditions. In any case, licenses are flexible, include fewer obligations and are easier to obtain than franchises.
The format you choose depends on the operations of the brand that interests you. Some brands sell whole franchises or entire systems, and you have to follow what they do, while other brands offer licenses, so you have to check and determine whether or not you are capable of establishing an equally good or even better system than them and whether or not setting your own system will be more expensive than buying a franchise.
Regardless of the format you choose, though, the most important things entrepreneurs have to do are as follows:
1.Perform business analysis.
Before making contact and asking to buy their rights, you first need to think and thoroughly analyze whether the business that interests you is suitable for the customer groups in our country in addition to whether or not it is the right time to launch that business in Thailand. Don’t forget that, while being the first to offer something new is an advantage, there’s also the disadvantage that customers have to learn about the new thing you are offering and that your business won’t make it if what you’re introducing is very new or you fail at communicating it well.
2. Make preparations.
Once you’ve performed your analysis and you’re confident you can make it, you’ll probably have lots of questions to ask concerning things like short-term and long-term business plans, opening locations in Thailand and business experience in ensuring that their restaurants won’t fail in Thailand, not to mention various other benefits before negotiating your purchase if they are willing to partner with you. You always have to consider the possibility that the franchise you want to buy might not have studied about their franchise sales at all. So, the more you study ahead of time about how to buy the international franchise, the more likely you will be able to succeed in your purchase negotiations. Consider creating business plans to provide a clear picture for your negotiations.
3. In negotiating,
ask for clarification about everything you’re not sure about such as about terms and conditions, benefits, things you might get from them, restaurant management system, ingredients, recipes, training system, setup assistance while opening the restaurant, QA system, things you can change, and things you cannot change. Everything has to be clear and stipulated in contractual writing, and so on.
Most international brands launched in this country that succeed are already very famous themselves. However, introducing famous brands also involves very high investments. Simply having enough money might not be sufficient. The rights owners might judge the credibility of companies that buy their rights and determine whether the companies can help their brands grow or not. On the other hand, for non-famous brands you’d like to open because you’ve had great experience with and enjoyed very much after dining there, it’s essential that you study the short-term and long-term market feasibilities in addition to negotiation terms and conditions.
