7 crucial factors in choosing a factory and warehouse location in Thailand

7 crucial factors in selecting a rental warehouse or factory location in Thailand. This article is relevant for business people planning to build a warehouse or factory themselves in Thailand or for business people planning to rent a warehouse or a factory in Thailand. There are several key factors, but we will highlight 7 essential factors in choosing your warehouse or factory location in Thailand.

In this article, we will aim to provide seven crucial insights which answer what makes the location of a rental warehouse or a rental factory great. Choosing an appropriate rental warehouse or factory can directly affect your business operation costs, such as transportation, storage, and inventory costs. Therefore, selecting the right location for renting your warehouse in Thailand can make your business life pleasant and greatly support sustainable business growth.

When considering renting a factory or warehouse location, you must evaluate various relevant factors. Therefore, this article aims to highlight seven essential elements in choosing the location of the factory and warehouse. We hope reading this article will help you with crucial insights into selecting the site of a rental factory and warehouse that best suits your business.

1. You should choose to rent a warehouse or factory close to your suppliers, manufacturers, and customers.

When choosing an excellent location to rent a warehouse or a factory, you should consider the location of our suppliers, manufacturers, and your customer. The rental warehouses and factories should be near your most prominent manufacturers or customers to help reduce shipping time and costs.

For instance, if your customers are primarily in foreign markets and your primary activities focus on exporting or importing goods by plane, the rental warehouse should be close to the airport. Or, if your primary activities concentrate on sea transport, your rental warehouse or factory should be near the country's main ports, namely Klong Toey Port and Laem Chabang Port. Where you rent a warehouse or factory determines the transportation efficiency of goods.

2. Transportation routes must be diverse and convenient.

The location of your warehouse and factory for rent must have convenient transportation means. You should be able to access it from various routes, which are major transport routes to access other essential business regions in Thailand. Therefore, you should look to rent a warehouse or a factory near major roads and expressways. These variables directly affect the transportation process or logistics of a business.

In the section below, we offer some factors that you may find helpful in selecting your rental warehouse location. These factors include:

Expressway entrances and exits

Connection between expressways

Public transport

Average traffic speed

Average traffic density

Rush hour traffic

Road safety

3. Sufficient labor force

Another vital factor in determining the location of your rental warehouse and factory is that the area should offer a sufficient, quality labor force. Recruitment of skill labors is necessary for successful business operations.

It would be best if you looked for a rental warehouse or factory is located in an area with sufficient labor capacity. This way, you can quickly increase the likelihood of employing qualified workers. It would help if you also considered the wage amounts of different regions. Thailand's labor costs vary greatly depending on where you rent a warehouse and factory in Thailand.

4. Civil Planning Law and Zoning Scheme

The zoning scheme is another necessary factor in determining where to rent a warehouse or a factory. Every province in Thailand has its own zoning schemes regulating where you can operate your business activities. For example, if your operations require operating combined machine horsepowers of over 500 horsepowers, then you can primarily rent in a purple zoning area. Or, if you are opting to rent a warehouse of a larger size, you would find they are concentrated in specific industrial zones, away from residential areas.

The civil planning lay would dictate the zones where landlords could build their factories and warehouses. Some areas may prohibit the construction of factories and warehouses, and others may limit the size of these rental warehouses and factories. Therefore, when you find a warehouse or factory you would like to rent, you should also study the zoning regulations of that area. If in doubt, you can get help from the local district office or the local municipality of that rental warehouse or factory.

If you are interested in city planning and zoning, please refer to the following link: https://www.trebs.ac.th/th/news_detail.php?nid=71

5. Easy Access to Public Services and Utilities

Another factor in choosing the location of your rent factory or warehouse is choosing a rental property close to public services, such as a police station or fire station, government office, and hospitals. These public establishments are necessary for your business operations and your employees' welfare. Your rental warehouse or factory should be within easy reach of these amenities.

The location of where you rent a factory or warehouse should also examine other amenities outside work. Department stores, restaurants, convenience stores, markets, and banks are vital to your staff's work-life happiness. In addition, there should be a sufficient amount of accommodation nearby, suitable for your employees, such as condominiums, apartments, and government housing projects.

6. Environment

Another consideration you should consider when searching where to rent a warehouse or factory is the local environmental characteristics of that particular area. It would help if you considered factors such as weather conditions, the risk of natural disasters, the chances of earthquakes, and flooding.

The surrounding neighbors of your rental warehouse and factory can significantly affect your business performance. Nearby factories, warehouses, and your rental warehouse's traffic conditions can substantially affect your business. Also, your warehouse for rent should offer wide road access, a suitable electrical system, an appropriate water supply, a sound drainage system, the proper telephone, and high-speed internet connections. These utilities should be ideal for industrial use. Finally, the rental warehouse or factory should not be too close to the community to prevent possible disturbances to the local community.

7. Costs related to the cost of land or rent in that location

The land cost is also an essential factor in choosing the location of where you rent your factory and warehouse. Due to the current increase in the land price, the price of the land would dictate the rental price. For example, if you rent a warehouse in Bangkok and the metropolitan areas, the rental fee would be considerably higher than in remote upcountry provinces. However, the rental price alone is not the sole cost. Other costs, such as logistics and transportation of goods fees, can quickly elevate when you choose a remote warehouse or factory. Therefore, you must evaluate the logistical costs of various locations and find the most appropriate rental warehouse for your business operations.

Another related point is that many business managers may want to purchase land plots and build warehouses or factories. But due to the expensive land prices in Bangkok and major cities, they choose to rent over owning their properties. This option allows them to free up their capital and invest in their core business activities. Also, it will enable them the flexibility to expand or move to other more suitable locations.

Source:

https://www.nextplus.co.th/expert-tips/location-roi-evaluation-for-building-factory

http://elearning.nsru.ac.th/web_elearning/sonthaya/lesson%206/lesson%206.html

http://elearning.bu.ac.th/mua/course/mg212/chapter2.html

https://www.proindsolutions.com/8-crucial-factors-in-choosing-a-factory-and-warehouse-location

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