Type 1 Factory – Handmade Jewelry Workshop

This example will be another example of a Type 1 factory just as we had explained in the other example called factory license for soap manufacturing which did not require a license. This is also an example of a Type 1 which also normally would not require a license. To see a Type 3 factory you can also look at the article we wrote on the license for a food processing factory. You will notice how complex those are in the documents for a factory license.

Since the factory will be low production with less than 5 horsepower, the factory is classified as a Type 1 factory under the Factory Act B.E. 2535 (1992). Note that the Type 1 factories in Thailand do not require a formal license, however the factory as small as it is must adhere to zoning laws and basic safety regulations.

So, Gleaming Gems Co. Ltd., a family-owned business. What the owners wanted was to expand its handmade jewelry production into a dedicated workshop. The new operations would be larger for their manually crafting jewelry with minimal equipment. So what they are adding is a small polishing machine with about 2 horsepower. This means that It qualified as a Type 1 factory. There is no license but adherence to safety and zoning regulations.The new production area is going to be expanded in the commercial area of Chiang Mai.

Firstly there is the zoning in Thailand. So Gleaming Gems conducted a zoning analysis to ensure compliance with land use laws under the City Planning Act B.E. 2518 (1975). This will ensure that the have the correct zone for their production. This was a mixed use zone in Chiang Mai that allowed for light industry. Small jewelry production is allowed in the area as it is light industry. Let a factory license lawyer take a look at what you need for the Type 1 factory even when it is light industry.

Secondly, Gleaming Gems asked for written confirmation from the local municipal office. This way they thought that may may avoid any conflicts with the government or their residential or commercial neighbors.

The facilities are small and it is a low risk operation. They did however decide to take proactive steps to comply with Section 8 of the Factory Act, which mandates basic safety measures. They further installed fire extinguishers close to all the workstations as well as where the propane torches are located. In addition there was the ventilation system that they also installed. Thus preventing the build up of dust. This also prevents the accumulation of dust and fumes from the polishing and soldering that takes place in the workshop.

There is a small amount of waste which is generated. These are mainly metal scraps as well as some polish residues. They decided to separate their waste and use a local recycler for this. They went even further and got the community involved in a small meeting to discuss any concerns that they might have.

Even though we know that the Type 1 factory does not need a license for the DIW they did inform the local authorities of their business as a gesture of transparency. You will notice also under our article called starting a restaurant in Pattaya that when you have a certain level of flammables in the kitchen that you notify the fire department as a precaution. If you need assistance then speak to us as a well known law firm in Thailand.

Challenges Encountered

Firstly there was a fire concern. The neighbors initially expressed concern about this. Mainly because there are propane torches in use for the soldering. Gleaming Gems addressed this by installing additional fire extinguishers and providing fire safety training to all employees.

Small minor complaints about noise for the polishing. They then used noise reduction barriers on the walls and adjusted operating hours.

Early operations led to minor complaints about noise from polishing machines. Likewise to mitigate this, the company installed noise-reducing barriers and adjusted operating hours to avoid disruptions during evenings. Likewise with the issues of insurance as it is light industry. They did manage to find the insurance and operations began. Lastly you may require a notary public Bangkok likewise a certified translation service in Bangkok as well.

Conclusion

The experience that we can see from Gleaming Gems Co. Ltd. Shows that even a small-scale factories can successfully establish operations in Thailand. This without the need or requiring any form of formal licensing. Likewise by focusing on safety as well as environmental responsibility. Even a small Type 1 factory can thrive and expand while adhering to legal and ethical business practices. Lastly as a Thai law firm we have extensive experience with factory setups.