Monday 27 May 2013
COnducting Business in Thailand
COnducting Business in Thailand
Contents 1.0 Introduction 1 1.1 Aim 1 1.2 Scope 1 1.3 Sources 1 2.0 General Considerations and Implications for Business 1 2.1 Currency and Exchange Rates 1 2.2 Political and Economic Climate 1 2.3 Language, Religion and Cultural Differences 1 3.0 Business Dealings 1 3.1 Status Issues 1 3.2 Cultural Differences and Making Decisions 1 3.3 Etiquette and Manners 1 3.4 Work Attitudes 1 3.5 Business Communication and Etiquette 1 4.0 Support Agencies and Sources of Support in Australia and Thailand 1 5.0 Recommendations 1 6.0 Conclusion 1 7.0 References 1
1.0 Introduction 2.1 Aim
This report has been conducted to discuss and assess the possibility and suitability of conducting an expansion of the 5 Star International Conference Centre and Resort to Thailand. 2.2 Scope
Barriers that may be encountered, if the expansion of 5 Star International Conference Centre and Resort to Thailand were to go forth, will be investigated within the report. The report evaluates general considerations such as currency and exchange rates, political and economic climates, language and religion and culture considerations, as well as business dealing etiquettes and suitable support agencies to assist in the expansion. 2.3 Sources
Multiple reliable secondary information sources were used to gather the data required for this report. The data was gained through reports and articles of government and on-government websites, including Austrade and Kwintessential.
2.0 General Considerations and Implications for Business 2.1 Currency and Exchange Rates
The official currency used in Thailand is the Baht. Bank notes are available in 20, 50, 100, 500 and 1,000 baht, while coins are available in 1, 2, 5 and 10 baht and 25 and 50 satang, where 1 baht = 100 satang (Australian Trade Commission, 2013). Satang is not commonly used anymore. Pricing is rounded up to the nearest baht. From 2011 onwards, the Australian dollar has been strong and stable against the Thai Baht. There was a significant drop in 2009 but since has risen and kept a consistent exchange rate with miniscule falls and rises.
To protect against currency fluctuations the Australian dollar must always be constantly monitored. An option for businesses expanding overseas is to produce a forward exchange contract which can be set up with a bank and lock in the future price for the Baht (StartupSmart, 2011). A business can also open up a foreign currency account which allows you to deposit export and contract payments received in the Baht and use those funds to pay expenses in the Baht (Australian Government, 2013).
Conducting an expansion in Thailand will benefit the company due to the stable exchange rate as well as the protection against currency fluctuations that can be implemented by most banks. 2.2 Political and Economic Climate
Thailand is a newly industrialised economy. It heavily relies on exports, with exports accounting for more than two thirds of its gross domestic product (GDP). Thailand is the second largest economy in Southeast Asia and has had a successful development in becoming an upper-middle income country. Thailand’s economy is currently recovering from the 2011 floods, one of the worst floods in history (East Asian Bureau of Economic Research, 2012) which dropped the GDP growth to negative 9 percent. Aside from flood damage, Thailand’s economy is in a suitable condition for an expansion of 5 Star due to its development to an upper-middle income country. 2.3 Language, Religion and Cultural Differences
The Thai language is the official language spoken in Thailand although English use is becoming more prevalent in business (Kwintessential, 2004).…