How Currency Exchange Rates Affect Import Costs From Thailand

Where the exchange rate enters your landed cost

Most importers think of currency only when they pay the supplier. In reality, the exchange rate touches several parts of your landed cost, and sometimes at different moments in time.

• **Product cost:** if the quote is in THB, the amount you pay in your own currency depends on the rate on the day your bank converts the payment.
• **Deposits and balances:** many orders are paid in two or more instalments. Each instalment can be converted at a different rate.
• **Freight and insurance:** these may be quoted in USD, THB or your local currency depending on the forwarder and the Incoterm you agreed.
• **Duties and taxes:** customs in your country usually calculate duty on the declared value converted at an official rate set by the authority, which may differ from your bank rate.
• **Bank and transfer fees:** the spread between the mid-market rate and the rate your bank actually gives you is a real cost, even if it is not shown as a fee.

The practical takeaway: build your cost sheet so that every line shows its original currency and the rate you assumed. That way, when rates move, you can see exactly which parts of your landed cost changed and by how much.

Quoting currency: THB, USD or your own currency?

The currency on the quotation decides who carries the exchange-rate risk between the quote and the payment.

**Quotes in THB** mean the supplier receives a predictable amount in their home currency, and you carry the conversion risk. If the baht strengthens against your currency before you pay, your cost rises.

**Quotes in USD** are common in international trade. They can be convenient if you already hold or earn USD, but if your sales are in a different local currency, you still face a conversion step, now between USD and your currency.

**Quotes in your local currency** are less common and, when offered, the supplier usually builds a buffer into the price to protect themselves.

None of these is automatically better. What matters is that you compare like with like. When you request quotes from Thai suppliers, ask for the currency to be stated clearly, and convert every quote into your own currency using the same assumed rate before deciding. A quote that looks cheaper in USD may not be cheaper once you account for how you will actually fund the payment.

Also confirm how long a quote is valid. A short validity window protects the supplier from currency and raw-material changes, so plan your decision time accordingly.

A simple way to stress-test your margin

You do not need to predict exchange rates to manage them. You need to know how much movement your margin can absorb.

A practical exercise is to build three columns in your cost sheet:

• **Base case:** today's rate.
• **Moderate move:** the rate a few percent less favourable to you.
• **Larger move:** a bigger adverse change, chosen based on how volatile your currency pair has been historically.

Recalculate the landed cost and gross margin for each column. If the moderate scenario already wipes out most of your margin, the product is fragile, and you may need a higher selling price, a different product mix or a different quoting arrangement before committing.

This matters most for low-margin, high-volume categories such as Thai snacks wholesale or household products, where a small cost change can turn a profitable order into a break-even one. Higher-margin categories, such as some Thai skincare wholesale lines, usually have more room, but they also tend to carry higher packaging and freight costs that should be included.

Repeat the exercise whenever you reprice your catalogue. It takes minutes and gives you a clear rule for when a price change is necessary rather than optional.

Practical habits to reduce currency surprises

Experienced importers rarely rely on a single trick. They combine small habits that together make costs more predictable:

• **Fix your internal rate:** use one assumed rate for all costing in a given period, slightly conservative compared with the current market, and review it on a schedule.
• **Time conversions deliberately:** if your payment terms allow, convert funds when you place the order rather than waiting until the balance is due, so you know your cost earlier.
• **Compare transfer providers:** banks and licensed payment providers offer different rates and fees. Compare the total amount the supplier receives, not just the advertised fee.
• **Ask your bank about available tools:** some banks offer forward contracts or similar products for businesses. Whether they suit you depends on your volumes and situation, so discuss it with your bank or a qualified adviser.
• **Keep a price-review clause:** for regular customers, agree in advance how and when your selling prices can be adjusted if costs change significantly.

None of these removes currency risk entirely. They turn it from an unpleasant surprise into a known, managed part of your business, which is what lenders, partners and your own team need to see.

Talking about currency with your Thai supplier

Currency is a normal topic in international trade, and raising it early makes negotiations smoother rather than harder.

Useful questions to ask before confirming an order:

• Which currency will the invoice be issued in, and can it be changed?
• How long is the quotation valid, and what happens if payment is made after that?
• Are freight or packaging costs quoted separately, and in which currency?
• What payment methods do you accept, and who pays the bank charges on each side?

For repeat orders, some buyers and suppliers agree on a reference approach, such as reviewing prices at set intervals rather than renegotiating each order. This gives both sides predictability. Treat it as a commercial discussion, and always confirm any arrangement in writing.

If you are sourcing across many categories, working from a wholesale Thai products catalog that lists items in a consistent currency makes comparison easier. Distributors such as ThaiNex and B2B platforms such as THAIMOST are among the options importers use alongside direct factory sourcing and trade fairs; in every case, confirm currency, validity and payment terms on the final quotation before you transfer funds.