Businesses in the Pratunam and Bo Bae garment districts in Bangkok are painting a grim picture of the retail market, citing a severe downturn driven by plunging purchasing power, high rental costs and a major shift to online shopping.
The challenging environment has forced numerous shops to close or put their spaces up for lease, while industry experts warn that urgent adaptation is critical for business survival.
In the bustling Pratunam area, a walk through the streets reveals many shuttered clothing shops, with numerous storefronts bearing signs offering the spaces for rent.
Business operators point to a combination of economic stagnation, shrinking disposable income, exorbitant rents and changing consumer behaviour as the main culprits. They note that survival now hinges entirely on a shop's ability to pivot its strategy.
Rita Chaiyong, a sales clerk in Pratunam, described the current trading atmosphere as deeply depressed. The situation is particularly dire for shops located deep within side alleys, where more than 50% of the storefronts have vanished because foot traffic simply fails to reach them.
Meanwhile, prime locations facing the main streets command astronomical monthly rents, some into six figures, pushing many vendors to relocate to cheaper districts. Outside major shopping malls, monthly rents in Pratunam still range from 40,000 to 150,000 baht, depending on the exact location.
A survey of several wholesale and retail malls in the area revealed a similarly quiet atmosphere, with both local shoppers and tourists noticeably sparse. Some operators say that garment sales have plummeted by 35% to 40%, yet rents continue to climb by an average of 20% annually.
Prime spots next to escalators can demand between 200,000 and 300,000 baht per month. Observers also noted that a large portion of these businesses are no longer Thai-owned, but are instead operated by foreign nationals who rent the spaces using Thai proxies.
The atmosphere at Bo Bae Market, traditionally one of the city's premier wholesale and retail clothing hubs, is equally bleak. Small-scale traders who still frequent the market report that the crowd has thinned dramatically, estimating that foot traffic has plummeted by up to 95% since e-commerce platforms gained in prominence. The sharp decline has triggered a wave of business liquidations and lease handovers.
Banjob Phianphanitporn, a sock vendor in Bo Bae Market, attributed the sluggishness to an influx of cheap Chinese goods flooding the market, alongside the rise of online livestream sales, both of which have crippled brick-and-mortar storefronts. In a bid to retain tenants, some landlords have slashed monthly rents from 40,000 baht down to just 8,000 baht. Even these drastic discounts have, however, failed to incentivise vendors to stay or reopen.
Offering an industry perspective, the ThaiFranchiseCenter assessed that, while transitioning to online apparel sales offers a lifeline for struggling operators, it carries significant risks if managed poorly. Without a proper strategy, businesses face the threat of sinking their capital into dead stock, due to ineffective marketing that fails to reach target audiences.
The agency cautioned digital newcomers against common pitfalls, such as selling the same products as competitors, engaging in destructive price wars, failing to secure direct access to manufacturers and neglecting active marketing campaigns.
To survive in this rapidly evolving landscape, operators must stay well-informed and continuously adapt to shifting market trends, the centre advised.
