Determinants of Competitiveness of the Thai Aromatic Coconut and Coconut Water Industry

Abstract

The objective of this research is to study the determinants of competitiveness of the Thai aromatic coconut and coconut water industry.  The research methods are in-depth interviews with stakeholders and perception surveys to entrepreneurs.  The framework of this research is Porter’s Diamond Competitiveness Model.  The results show that increased demand for aromatic coconut and coconut water products in both domestic and international markets, driven by health concerns, is a primary factor for the entrepreneurs to improve their product quality toward international standard and to produce to satisfy more diverse market demands. The key competitive advantage of Thai aromatic coconut and coconut water, unlike those in other countries, is cultivated lands that suitably produce sweet and aromatic coconuts.  In the meantime, recruiting labors, most of which are unskilled and migrant workers, for the business may not meet increasing demand in the future. In addition, increased competition drives many entrepreneurs to invest in new technology and innovation related to both planting and product processing. Many have stepped themselves up from farmers to producers and adopted contract-farming and business-alliance strategies. In the meantime, government policies have substantial impacts, especially in promoting domestic and international trades.  Nevertheless, policies to promote coconut production, worker training and entrepreneurs’ technology usage ability are prompted, in order to ensure sustained competitiveness of the Thai aromatic coconut and coconut water industry.