Starting a small business_god idea/bad idea

[Tinker]

Thinking about moving to Hua Hin, and just wondered what the opinion would be for all who currently reside in the LOS. The company that I work for are looking for people to take voluntary redundancy. Although the money won't be massive, maybe about 30k uk pounds. I was wondering if that would be sufficent to start a small business of some kind. I am not looking to make large amounts of money from the enterprise, maybe just enough to live on and have an enjoyable life style.
I am not looking to sell my house in the uk, as I feel it would be wise to hang onto this should things not work out.
Any thoughts on the pro's and con's of setting up a business would very welcome.

[baron_wastelanduk]

Tinker

if you are thinking about it seriously then be prepared to jump through a lot of hoops and a mountain of paperwork
there are of course restrictions on what you can and cant do in addition
not sure if its still the case whereby if you are in direct competition with an existing Thai company the authorities will allow you to start

it may be worth yr while emailing my brother who has his own company over in thailand info@solarenergyasia.com

[Super Joe]

Some bureaucratic things to consider:

1) Most typical businesses are restricted to foreigners, see FBA (Foreign Business Act), therefore you need to form a Thai Limited Company with Thai shareholders.
2) You must have a Work Permit and must employ 4 no. Thais to get this, minimum wage 5,600 Baht I think.
3) You have to pay (monthly) income tax on a set minimum of 50k Baht for yourself and pay withholding tax and social security payments for your staff, this works out about 10,500'ish Baht per month.
4) There is a long list of tasks that you the foreigner can not perform but your Thai staff must do, included is 'labour work' which covers most everyday things like driving, opening a bootle of beer, cleaning a table, serving a customer etc etc.
See attached list of prohibited tasks: http://www.sbcinterlaw.com/pdf/Informat ... ionLaw.pdf

The above does come with some positives, like yearly 'B' Business visa so no need for visa runs across border and no need to return to UK every 12-15 months as you can extend for another year without leaving the province. Possibly covers half the tax costs quoted above.

Good luck,

SJ

[baron_wastelanduk]

Spot on Joe
all the things my brother whinges about
i was talking with him today and if he wanted to employ me he would
a) have to employ 4 more thais
b) pay me a salary of £50k
and so on
and i was only talking about setting up a satellite office from home in central thailand

[Super Joe]

Hi Baron,

50k Sterlng a month instead of 50k Baht, blimey your brother's generous
Thing is there seems to be no checks that you actually pay the staff the salaries, they just want the tax collection. The 4 Thais if on standard wages, would be liable for zero income tax at end of year anywat as they are well under the allowances etc, so no check that way either.
People do do it this way, ie: 'dummy' staff and therefore no actual wages outlay, maybe they have 2 real staff, but it would be illegal.

Seems I know your brother from that link.

SJ

[crazy88]

The first business I set up in Thailand was done as a limited partnership .51% Thai and 49% foreign .We did not need any Thai employees .With all the fees etc. over the year it worked out at about the same as SJ suggests but no fake employees etc to worry about .This was in Surat Thani province .2 work permits .Information valid as of 12 months ago .Rules may have changed .

As for starting a small business in principle .Look carefully at what is needed,do your homework and the math,find your niche and market yourself properly .

Good luck


Crazy 88

[buksida]

As stated above the bureaucracy and constant shelling out to operate legally as a foreigner here is mind numbing and every year it seems to get worse. Work out what you'll need to clear in profit to survive after paying all your dues and you may well think again.

Don't want to pee on your fire but so many come to HH with the best of intentions and end up broke after two years. Add to this fact that Hua Hin is a pie that is too small for the amount of people trying to get a slice, pretty much everything has already been done several times so your competition will be cut-throat.

Even if you're lucky enough to come up with a niche market someone will copy it within weeks and setup against you - its just that kind of town sadly. And then there are office rents which are extortionate if you need a place that is central and has good foot traffic.

Sorry for all the negativity and I wish you well in any endeavour you decide to pursue, just trying to help you go into it with your eyes open.

[Randy Cornhole]

With what ive learned over the last 6 years I woudn't personally start a business in Hua Hin.

Im not saying its not possible, just very very hard. There is a good chance you will loose your money.

Its up to you, but think very carefully. Try living here for a year first and then make the decision...

[crazy88]

The OP came on here for feedback and advice .I do the same and try to repay the same in return along with a bit of friendly banter .

We have a startup budget outlined .Most of us know the town very well and we all know the current economic situation .What kind of business would make a profit in HH right now ? What do the residents and regular visitors find lacking in availability ? I've always tried to find out what the customer doesn't want as early as possible, then I am left with what the customer might and does want .We are all potential customers for the OP .What kind of service or product would we like to see in HH that we would spend our hard earned on ?

I'll start .

A computer shop with English speaking staff that actually had any stock in HH would have sold an imac and a laptop to my friends yesterday .Now they are going to go to Bangkok .

Let's try and help the OP realise his dream before,as with many,he opens up with "going skint" written above his door in invisible writing that is visible to all .

Crazy 88

[Tinker]

Thank's for all the advice guys. I,m starting to feel like its a bit of a mine field, after listening to some of your comments. Randy, I did come and stay for 2 months just recently and really had a great time. I have been to Hua Hin several times over the few years and now it is starting to feel like home to me. But to stay full time I would need to generate some income to live on in the long term. I guess that's another dream shattered. Thank's again anyway!

[baron_wastelanduk]

Hi Baron,

50k Sterlng a month instead of 50k Baht, blimey your brother's generous oops that was a mistake should have been baht

Seems I know your brother from that link.

he and his gf had a small feature in AWOL last month "solar Dave" made me smile
but he is proof that if you stick at it you can surviveSJ

I dare say you seen him around HH in the past SJ

[Super Joe]

Yeah I know him, we arrived in HH about same time, also both worked in Hong Kong at same time although never knew each other over there.



Tinker, as everyone has said it would be a tough task with only 30k behind you, unless you have other income coming over each month. Ofcourse it can be done if you get the right business and it takes off. But Hua Hin has a very bad low season and anything like shops, restaurants, bars, real estate, car hire, internet cafe's etc are already over-supplied.

Personally I think there is a market for small building works, ie: alterations, modifications, repairs and the like to existing houses after developers warranty is up. People are always looking at home improvements like water filter systems, sandwashing path/driveways, rainwater guttering, rainwater collection for watering garden, gazebos, adding a car port, building a nice BBQ, extending patios, adding sundecks, replacing water pumps/tanks, adding water tanks for additional storage, garden feature lighting, raising wall heights, aditional fencing, updating bathrooms, re-tiling, plumbing issues, re-painting outside of house 50' up a ladder etc etc etc.
Much of the above we have had people ask about but developers in the main want to build houses and not do small works, also many of the homeowners are retirees in their 60's and don't fancy doing DIY.

30k doesn't leave a lot to spare if your business does not take off from the get go, you got business set-up costs, staff, car/truck, house rental, shop/office rental (often requiring a years rental upfront), stock & equipment, emergency hospital cash/insurance etc.

Good luck though,

SJ

[hhfarang]

Before you start any business anywhere in the world, the intelligent process is to create a business plan. This is not a simple procedure that is done by asking a few questions on a forum but requires an intense personal study of the area, the types of business (competition) you are thinking of opening, how they are doing, studies of locations and numbers of street traffic by said locations both vehicular, and pedestrian. It also requires a person to come up with a budget of what is expected for monthly outlay of expenses and expectations of income for cash flow purposes. It is not easy if you want to succeed. It requires a lot of prior knowledge of the market, competition, costs, and legal requirements.

Anyone who knows anything about starting a business will also tell you you have to start with enough operating capital to pay for the first year with no profit expectations. After that is when you may expect to make it and start to get your investment back.

Don't just jump into any business without doing a lot of study and homework first.

[Spitfire]

I don't know how well you know Hua Hin but I would suggest living somewhere for a while before jumping into business. I don't know your situation but I'd probably try find some work here or close to HH and check it all out first.

Some very sound advice here from all.

[baron_wastelanduk]

Joe

i know its off topic but i just sent you a pm