Chin Yao Advisory
Supply Chain & Partner Due Diligence

Your Customer Is Already Building in Thailand. Waiting for the Call Is Too Late

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Close-up of an electronic circuit board and components
Photo: Umberto / Unsplash

On 20 October 2026, Taiwanese manufacturer Global Tek Fabrication (GTF) opened its new industrial park in Chonburi, Thailand. The site covers 17.76 hectares, with seven factory buildings and an office block planned. The office and three factory buildings are finished, trial production began in the third quarter, and the company has committed US$30 million to the project.

It is not an isolated case. Delta Electronics completed three new plants in Thailand at the end of 2025, took on volume production of liquid cooling systems this year, and has three more plants due next year. Inventec expects its new Thai plant to open in the first quarter of 2027 for server and notebook assembly. Further up the chain, a listed Taiwanese plating supplier broke ground in Ayutthaya in April, putting NT$300 million into a first phase due to finish this year.

Taiwanese capacity in Thailand is being built one plant at a time.

Many suppliers read this news and think: "If our customer really needs us there, they will tell us."

My view is blunt: by the time that call comes, it is usually late. On the day a customer asks, it typically already has a list of suppliers who can deliver in Thailand. If you are not on that list, you are no longer following the customer. You are fighting for someone else's order.

First: see who is really pulling you to Thailand

Most owners assume the decision depends on their direct customer. In practice, the pull often comes from the customer's customer.

I helped a Taiwanese electronic components maker set up a subsidiary in Thailand. The push did not come from its direct customer. It came from the end customer further down the chain. Once the end customer moved production to Thailand, the whole supply chain had to be rearranged. Had the company waited for its direct customer to ask, it would have been too late.

I have also helped a number of upstream suppliers to Inventec, Delta Electronics and Chicony set up BOI-promoted trading and service bases in Thailand. Most of them did not start with a factory. They started by making sure they had people on the ground and could deliver locally.

So the first step is to look one level further down: whose product does yours end up in, and where is that company's Thai production schedule now? That tells you more than asking whether Thailand is a good market.

Second: ask what the customer needs you to do in Thailand

Within the same group, the Thai plant and the Taiwan headquarters may run separate purchasing teams and separate supplier qualification. Being trusted in Taiwan does not mean the Thai team knows you.

Four questions to answer first:

  • Who decides purchasing for the Thai plant? Can it buy locally, or does Taiwan headquarters approve?
  • How does qualification work at the new plant? Do you need new samples, tests or audits?
  • What delivery standard is expected? Shipping from Taiwan, can you meet lead times, lot sizes and replenishment?
  • Who shows up when something goes wrong? How quickly does the customer expect someone on site for a quality or equipment issue?

Many suppliers think they sell parts. In Thailand, what the customer often cares about is where your stock is on the day materials run short, and where your people are on the day something breaks.

Third: following the customer does not mean building a factory first

When owners hear "set up in Thailand", the first thought is land and a plant. Most suppliers do not need to do everything at once. There are four stages:

  1. Ship from Taiwan while volumes are small and lead times still work.
  2. Set up a trading and service base once the customer wants a local contact, local invoicing or someone to visit the line.
  3. Add local stock and technical service when replenishment is frequent or equipment needs installation and maintenance.
  4. Build a factory only when orders are stable and the process has to be done locally.

Stage two is where many get stuck. A foreign company trading or providing services in Thailand runs into the Foreign Business Act: retail, wholesale and other services are restricted activities. Without enough capital or another route, a wholly foreign-owned company cannot simply start operating.

That is why most of the suppliers I worked with set up their base through non-manufacturing BOI categories such as IPO (International Procurement Office) and TISO (Trade and Investment Support Office). Once BOI approves the activity, the company can apply to the Department of Business Development for a Foreign Business Certificate instead of going through the full Foreign Business License review.

Materials and components suppliers should look at IPO. Equipment suppliers who also install and maintain should look at TISO. I set out the differences in my article on Thailand's advanced materials supply chain. The rule is simple: choose the category to match the business you actually do, not the other way round.

Why waiting is not an option

From the first visit to regular supply, you go through samples, testing, audits and trial orders. Each step takes time, and most of it is outside your control. Setting up a Thai company, getting BOI approval and starting operations takes time too.

The window for a supplier is while a new plant is in trial production and bringing in new products. GTF's Thai park only entered trial production this quarter, and Inventec's plant opens in early 2027. Those dates are still ahead. Once the lines mature and purchasing and service routines settle, a late supplier has to spend far more to prove it is worth switching to.

Not waiting does not mean spending on a factory tomorrow. It means looking past your customer to their customer now, finding the right contacts in Thailand, confirming the qualification timeline, and setting clear conditions for each next step: a base when there is clear demand, local stock when replenishment is steady, a factory when orders can carry it.

On the day your customer starts ordering in Thailand, what you need to show is a delivery plan, not "we can ship from Taiwan". The order is straightforward: see who is pulling you → confirm what is required → choose the right kind of base → scale with orders.

Legal basis

  • Foreign Business Act B.E. 2542 (1999), List Three: retail, wholesale and other services
  • BOI promotion categories: IPO, TISO

Sources

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Information checked on 21 October 2026. This article is general information. Company investment and plant timelines follow each company's latest announcements; BOI conditions and the Foreign Business Act may change, and each case depends on the actual business and the authorities' assessment.

Questions about your own case? Connect with the author on LinkedIn.

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