Permits For Starting Cafe In Thailand?

[solo siam]

I also wonder how someone can be the master franchiser for a country and personally own many of those same franchised restaurants as well, surely there is a conflict of interest!

As the Master Franchiser they get to veto the locations etc... so what if someone wants to open a restaurant in an area near one of Sunbelts own restaurants, or one that may take away potential business, whats to stop Sunbelt from giving themselves all the best locations or changing menus/supplies to suit their own restaurants (i.e ham doesn't sell well in our restaurants, so we won't import it etc.. anymore). Also if you are reselling those restaurants, whats to stop you just buying all the best ones and leaving the badly performing ones for others to buy.

Then theres the potential for poaching staff, unfair distribution of franchised advertising, the fact that Sunbelt have access to Subway business information earlier and to a greater depth than other franchisors, down to what happens if they are running low on Thailand Subway stock how can other franchises be sure that Sunbelts own restaurants aren't getting the best/only supplies.

I may be missing something, but I have wondered about this before so thought I would voice it.

[sarpesius]

....

From your message, and this is the last I will comment on it as it is somewhat feudal..

Buying anything retail is not smart business. If you call a coffee company, they will judge your business and give you free machines based on you using their product, at the price you negotiate. Of course, if you do it 'housewife' style, then you get 'housewife product' which is not a negative statement. However, if you have plans of taking over Sukomvit, BKK, the world with your 'business model' you better start to sharpen that pencil because you have a business idea that holds water like a sieve.

One person shop, if you use 5 kg a day, that is the machine running day and night, meaning about 825 kg a year. If I go to that same supplier with my yearly useage of 54,000 kg, I will get more leverage, which is important, as coffee is a commodity, in fact, one one fixed price you can not control unless you lock it in

Your point of Thailand being a graveyard of failed restaurants of farang business owners is simply not true. Restaurant industry does not prejudge. The industry screws the local as much as the farang. The point you are making is the same as I am making. You have someone who has no clue how to run a restaurant, spending money and loosing it because he does not have any restaurant experience.

To running a restaurant there is no book, there is something called luck, such as opening a cafe and hoping that Starbucks doesn't open next door. No matter what hole you put a cafe, if there is a starbucks next to you, you WILL go broke, as they suck the life out of anything due ONLY to their brand identity, no matter if it is a crap blend of coffee from the plantation that they own in Colombia to keep their costs down.

Sorry my friend, I hope you have the luck, because even I would need it if I went in alone, but not as much as you, it seems....

Should anyone wish to contact me further on this subject, please PM me, as this is the last I will write on this thread regarding this subject.

To make progress in a wholesome discussion (as opposed to the usual flame-war between drunks that characterizes internet discussions), it is necessary to answer points made specifically.

I may not even have to use the "coffee machine." You recall the old Thai style coffee service, in which a man with a pushcart dipped a cloth bag into hot water. in the 80's and early 90's, a cup of this coffee cost 5 Baht. This method can be revived depending on the tolerance of the target market, although I might have to charge more to cover rent.

Regarding buying retail, the real issue here is just cost, regardless of what you call it. You weigh costs against revenue. If the rent is low enough, you may be able to profit despite buying retail.

There is a medium- to low-grade coffee in Thailand that has a mild, chocolaty flavor (probably lowland grown). Viewing coffee as a social and catalytic medium rather than something taken for its own sake, this product might be acceptable.

NIGHT TIME PLACES

Another issue is thai attitudes toward night-time places. We note that food stalls and some brick-and-mortar restaurants are allowed to stay open until 3 a. m.

A clear distinction must be made between drinking and sex places on the one hand, and a genuine food service on the other.

STARBUCK COMPETITION

The matter of competition from Starbucks or anyone opening next door depends on the niche you target.

The business model is based on the fact that no other business has correctly identified a niche. An original business model derives from correct niche identification, not the other way around.

This means that the customer who will patronize your business will not patronize Starbucks willingly, only by default.

Secondly, the advantage of renting the premises means that even if something you don't like moves in next door, you can relocate quickly. So a floating premise is more survivable.

sarpesius

Edited March 2, 2007 by sarpesius

[solo siam]

you can't just decide there is a niche and thats it, have you actually done any research to find if there is any DEMAND for what you want to offer. Just about every small restaurant in Thailand offers Tea, Cafe Yen etc... at prices like you want to offer. Whats the differentiator?

[smartecosse]

you can't just decide there is a niche and thats it, have you actually done any research to find if there is any DEMAND for what you want to offer. Just about every small restaurant in Thailand offers Tea, Cafe Yen etc... at prices like you want to offer. Whats the differentiator?

his winning personality and "secrets" from India

[sarpesius]

you can't just decide there is a niche and thats it,...

How do you know that is what has been done in this case?

...have you actually done any research to find if there is any DEMAND for what you want to offer.

What makes you think this has not already been done?

Just about every small restaurant in Thailand offers Tea, Cafe Yen etc... at prices like you want to offer. Whats the differentiator?

Consider all the places, Thai and farang, around Thapae Gate, that are practically empty most of the time. Chiang Rai is even worse. If they can stay in business with the paucity of business they generate, that is an encouraging sign on the one hand.

On the other hand, what is the commonality among them that may be keeping them from attracting more people?

sarpesius

[Sunbelt Asia]

Owning a business is not easy and it certainly is not for everyone. I’m an owner/ shareholder of twenty different restaurants in Thailand.

Off topic... but

How can you "mix" -and be proud of- a business brooker activity with the ownership of businesses ?

There could be a conflict of interests...

Because actually, you are listing restaurant businesses to sale.

So, do we have to understand that you have bought the good deals, before to list them publically, and that the restaurants that are listed are... crap ?

"Sunbelt Business Brooker" is a cover to dig the good deals for "Sunbelt Investor" ?

I can be VERY proud as Not one single case would you find there has been a conflict of interest. Our Sunbelt clients ALWAYS have had the first opportunity to buy the business with only one exception. When we ended up buying the business, odds are good, if we didn’t buy, it was never going to be acquired.

If any seller comes out of the woodwork (besides this one exception) and says that he approached our firm to sell it for him and I said “I’ll buy it,” before the business was ever listed and marketed by us. He will be paid ten million Baht. Word to the wise: It won’t happen because it has never happen!

Any business that I ever bought was listed and advertised on multiple websites and sent out to over 19,000 possible investors before it was ever acquired by me. The shortest listing time was over four months and the longest time it was on our website was two years before other shareholders and I acquired it.

By the way, you can’t say it wasn’t marketed either as every one of these listings had many people look at it, all except one, had a letter of intent to buy as well from another party, before I invested much later.

Here are the case situations:

Chester Grill listing was a nine month listing. 14 people looked at it. One offer to purchase fell thru because it was for the investor’s son. The son decided he didn’t want to be a business owner. I bought it myself three months later.

Subway location at Nana with Coffee World. ( It was a co-brand opportunity or you could take over the lease).This listing to co-brand was over a year old before it was leased. Nine different investors looked at it. Reason why no one was interested: They felt the rent was too high. We bought a Subway franchise and did a co-brand.

Subway at All Seasons… Listing was 4 months old. We bought the assets and moved this to Phuket. 18 people looked at the opportunity. One offer to purchase fell thru because the investor couldn’t raise the capital. We bought it one month later after the deal fell apart at an auction. Chief reason, most people did not buy, it was not making a profit.

Glass Home…. Listing was over two years old when it was acquired. One offer to purchase fell thru because the investor decided to move to Singapore. Six different people looked at it. We ended up being one of the investors over a year later after the deal had fallen apart.

The only exception that I ever bought a restaurant, before calling a client about it, happen just two months ago. ( It was impossible to list it as their was only 90 minutes to take it over) Happen Jan 10th at 1 p.m. a restaurant owner could not pay Januarys rent. The rent payment had to be at the Rembrandt Hotel Office by 2:30 p.m. or the rent deposit would be forfeited and the owner’s equipment would be confiscated. The Sellers deal had fallen thru and the buyer left him in a bind.( He had tried to sell the business on his own. Never had ever approached our firm before this) He was crying in the lobby that he didn't even have money to go back to India and to please to help him with buying it.

I made the rent payment in the next hour for him, after doing a offer to purchase. Later we torn up the lease with the Landlord and backdated the new lease to Jan 1st. I paid the owner the 3 months deposit and 85,000 Baht towards the equipment. I'm trying to sell the equipment now thru our website , can’t even get 20,000 baht for the old equipment. I'm investing 1.5 million Baht in changing the concept, build-out, etc.

Every other restaurant we ever acquired was a new franchise or start-up. We do not have any Master Franchise rights of any restaurant. We are independent franchisees with no exclusive rights. Some other franchisee could move next door to any franchise and not one thing we could do about it.

I’ve been asked by other prospective franchisees about some of the franchises we are involved in. Often times, the franchisor will give my wife or my name to contact when they want to talk about that franchise. I have always taken the time to give the positives and even negatives.

Next time please get your facts straight before you slander Sunbelt's name.

www.sunbeltasiagroup.com

[Sunbelt Asia]

I also wonder how someone can be the master franchiser for a country and personally own many of those same franchised restaurants as well, surely there is a conflict of interest!

We are not a master franchisee or franchisor for any restaurant. We are only one of many franchisees.

As the Master Franchiser they get to veto the locations etc... so what if someone wants to open a restaurant in an area near one of Sunbelts own restaurants, or one that may take away potential business, whats to stop Sunbelt from giving themselves all the best locations or changing menus/supplies to suit their own restaurants (i.e ham doesn't sell well in our restaurants, so we won't import it etc.. anymore).

We have zero rights as a franchisee when it comes to competition. Someone could open next door. Nothing we could do about it.

A franchisee must follow the system or be out of compliance. If you are out of compliance several months, you then will be closed down. All of our franchisees are inspected every month. Not once did we ever do an evaluation on another franchisee as we are not a Master Franchise or Franchisor.

Also if you are reselling those restaurants, whats to stop you just buying all the best ones and leaving the badly performing ones for others to buy.

Its call ethics and integrity. That’s why we don’t do it. We let our clients have the opportunity to own any business first.

Then theres the potential for poaching staff, unfair distribution of franchised advertising, the fact that Sunbelt have access to Subway business information earlier and to a greater depth than other franchisors, down to what happens if they are running low on Thailand Subway stock how can other franchises be sure that Sunbelts own restaurants aren't getting the best/only supplies.

We are only a franchisee.

However, Subway has a Food Council. My wife did served on the board of directors for one year (The record will show, it was over three years ago. She could not decline this title as only one other Subway franchisee existed then.) Every year a new board is elected. By the way, the Franchisor has the final decision and is very strict about quality controls. Hence no action except ideas has ever happen.

The advertising is headed up by another group. My wife is not on this board now. However, once again three years ago she was on this board. No advertising was spent that year and the advertising fund was saved for following years with other franchisees to share in this allocation.

Supplies are distributed by a Central Supplier. All stores in fact share with other stores, if they are running low of an item.

I may be missing something, but I have wondered about this before so thought I would voice it.

At least you gave me a chance to explain. Thank you.

www.sunbeltasiagroup.com

[solo siam]

Thanks for clearing that up I just assumed that Sunbelt held some sort of Master Franchise for some of those brands, obviously you don't so my comments are moot. I must say I appreciate the amount of time you put into these boards, as a business owner I know time is always at a premium.

[Sunbelt Asia]

I must say I appreciate the amount of time you put into these boards, as a business owner I know time is always at a premium.

Thank you for saying " you appreciate the time I respond to posts." Your pat on the back, feels good on a Sunday morning.

I also must mention that I appreciate Lopburi3 time. He is a true champion on the Thaivisa board.

www.sunbeltasiagroup.com