Building a Factory from Scratch

Manufacturing is a serious business. The larger the production, the more complex the business becomes—and, accordingly, the more time and effort it takes to establish.
Does this rule apply to Thailand?

When it comes to building and launching a factory within an industrial estate, the size of the facility affects only the actual construction timeline, not the time required to obtain licenses, permits, and employee visas.

Let’s walk through the step-by-step process of building and launching a factory from scratch.

Stage One (1–2 months)

1.1. This stage begins with selecting a land plot for construction and signing a letter of intent to purchase it.

1.2. To sign the land purchase agreement, the buyer must be a company—a limited liability entity registered under Thai law. Therefore, once the decision to acquire land is made, the company registration process must begin: reserving the company name, paying the registered capital, and registering a temporary address.

1.3. Selecting a general contractor and signing a construction agreement. It is advisable to choose a construction company with relevant experience in similar projects.

1.4. Even before the company is fully registered, the process of obtaining a license from the Board of Investment (BOI) can begin. The application review period depends on the project’s value and may take up to 90 days, provided the application is properly prepared and all required documents are submitted.

1.5. Signing the land purchase agreement.

Stage Two (1–2 months)

2.1. Obtaining the land ownership certificate, as well as the necessary construction permits: land use permit, land ownership permit, and submission of documents for a construction license.

2.2. The general contractor develops the project design and plans and, after obtaining the required permits, begins construction.

2.3. The company registers as a Value Added Tax (VAT) payer.

2.4. If necessary, the company may begin applying for work permits for foreign employees at this stage.

Stage Three (4–5 months)

3.1. After the Board of Investment reviews the application and issues a positive decision, the company receives notification and a certificate granting BOI privileges and incentives. Upon receiving the certificate, the company must provide details of the equipment intended for import.

3.2. Obtaining the construction license (typically 2–3 months from the date of application).

3.3. After receiving the construction license, the building must be officially registered and assigned a legal address.

3.4. The company’s registered address and VAT registration address must be updated to the new factory location.

Stage Four (2–3 months)

4.1. Completion and approval of construction.

4.2. Obtaining the manufacturing license.

4.3. Importing equipment.

4.4. Launching production.

Summary

With a proper and systematic approach, the period from deciding to purchase land to launching a factory typically takes 8 months to 1 year.

Of course, certain types of manufacturing may require additional permits and licenses, which can extend the timeline. Such cases should be considered individually.