Small Business Op.... Advice?

[lingyuk]

Hiya!

I've been in Thailand for just over 4 months now, bouncing around with 1 month visa runs and 2 + 1 tourist visas.

Despite promising everyone I wouldn't, I've fallen for a lovely thai girl and after living together for a few months, have decided to try and settle and possibly venture into business together.

I've read around the forums, but would like some specific advice anyone can give me:

(Aplogies if my questions are answered elswhere, just let me know)

We have the jump on a pretty good business opportunity. If it was in Australia (my country of origin) I would snap it up and gladly accept the financial risk (investment looks between 800,000 to 1,000,000 baht) since it is already a proven a profitable business that we would be taking over right away (sorry, it's on the qt for the moment guys - don't know who's on these forums. Could be the competition, you know. But I can tell you it's quite small and farang-orientated. Similar to a cafe, internet cafe or a bookshop)

There's just too many unknowns right now, though. i can't calculate the risk. I know there's a lot of details and fiddly things, but generally would you say it's a smooth course to travel? Or are there too many hurdles to just dive in and grab this op?

I have learnt that the previous owner was here for close to a decade, and was forced to bounce in and around on different short term visas... is this normal? Is this what a lot of you guys are doing?

Thanks so much!

[kiakaha]

I have learnt that the previous owner was here for close to a decade, and was forced to bounce in and around on different short term visas... is this normal? Is this what a lot of you guys are doing?

No it is not normal.

It is illegal.

If you own the business, you should be able to get a Non Imm B visa and Work permit.Then subject to requirements, you can extend your permit of stay so visa runs are not necessary.

[wolf5370]

Of course this depends what the business is in...I think you are not allowed to work in a cafe/restaurant though you may own it. Based on the ownership (Thai perentage etc), you may not be able to own the property (the company may not). It is a risky proposition to put all in your new girls hands (however much things look rosie now) - just read the sob stories all over then net!!!!

If I was you, I'd take any comment here as good natured general advice, but talk to someone ike SunBelt Asia for the nitt gritty - its got to be worth the bucks.

Good luck

[kiakaha]

Do your due diligence on EVERYTHING. Immigration, work, tax, staffing, employer law, accounting requirements, property lease law etc.. etc.. As previous poster said, Sunbelt are a good resource.

Some may dispute this, but I also think having a decent command of the language helps to(that means reading thai). I've been here 12 years and am still learning.....after 4 months ?...like I said, do your due diligence, and good luck.

[lingyuk]

I have learnt that the previous owner was here for close to a decade, and was forced to bounce in and around on different short term visas... is this normal? Is this what a lot of you guys are doing?

No it is not normal.

It is illegal.

If you own the business, you should be able to get a Non Imm B visa and Work permit.Then subject to requirements, you can extend your permit of stay so visa runs are not necessary.

Ok, once you own the business... is it normally easy / straight forward to buy such a business? It is currently legally owned by the previous owner's ex-girlfriend, who (lucky for him) is very honest and is going to pass the money straight on to him.

[lingyuk]

Of course this depends what the business is in...I think you are not allowed to work in a cafe/restaurant though you may own it. Based on the ownership (Thai perentage etc), you may not be able to own the property (the company may not). It is a risky proposition to put all in your new girls hands (however much things look rosie now) - just read the sob stories all over then net!!!!

If I was you, I'd take any comment here as good natured general advice, but talk to someone ike SunBelt Asia for the nitt gritty - its got to be worth the bucks.

Good luck

Great advice! I am checking the website now! Thanks guys...

[funfun]

Go with the gut feeling, but keep the girl out of it on paper, she'll have ya by the balls, and you and aussie's dont like that mate!

would you buy a shop house lease etc in aussie land in a birds name after 4 months?????????

sunbelt , yes good idea, good on the ground knowledge but dont let them use the yankee pressure treatment on you!!

"bounce in and around on different short term visas"

again sunbelt or nip back to auss and get a real one!

Good luck an all the best!

chris

[lingyuk]

You're all correct of course. Risks are part of the game, and I am trying to learn as much as possible in the short time I have to take this opportunity.

Anyone have experience with SunBelt for a small business venture... less than a million?

[wolf5370]

In his buiness listings he has some copanies less than 1m, so he certainly deals with them.

[lingyuk]

Thanks Chris,

My gut feels very good in this case, especially since I may have the option to make a downpayment and pay off the remainder of the business cost with profit over the next few months... this reduces my risk considerably... but my gut has been known to mislead, and I'm still very new to this... wondering what ghouls are lurking behind unknown corners in the world of thai business.

chris, are you a business owner here as well?

[funfun]

Thanks Chris,

My gut feels very good in this case, especially since I may have the option to make a downpayment and pay off the remainder of the business cost with profit over the next few months... this reduces my risk considerably... but my gut has been known to mislead, and I'm still very new to this... wondering what ghouls are lurking behind unknown corners in the world of thai business.

chris, are you a business owner here as well?

yes, and sunbelt are good, but watch for the high pressure " give us a deposit now" tell em to walk, im from uk and hate that or the guy i used i shouldnt say all sunbelt but he tried the if you havent got enough money mate tatic, didnt work, pissed me off to be fair, but the outcome was good they do what it says on the tin!

now more of a worry is not sunbelt but you didnt reply wth,

Your right lads ill get everything done so it aint in her name???????

why not???

read all the posts again before ya go to bed lingyuk!!

just trying to help ya from Hollywood mate!!

[lingyuk]

Thanks mate... but, I'm not quite following you... did I miss something?

I would like to work it so we share the biz 50 / 50 if possible.

Thanks Hollywood.

Maverick signing off for tonight...

: )

Edited March 12, 2008 by lingyuk

[anonymouse]

Hiya!

I've been in Thailand for just over 4 months now, bouncing around with 1 month visa runs and 2 + 1 tourist visas.

Despite promising everyone I wouldn't, I've fallen for a lovely thai girl and after living together for a few months, have decided to try and settle and possibly venture into business together.

I've read around the forums, but would like some specific advice anyone can give me:

(Aplogies if my questions are answered elswhere, just let me know)

We have the jump on a pretty good business opportunity. If it was in Australia (my country of origin) I would snap it up and gladly accept the financial risk (investment looks between 800,000 to 1,000,000 baht) since it is already a proven a profitable business that we would be taking over right away (sorry, it's on the qt for the moment guys - don't know who's on these forums. Could be the competition, you know. But I can tell you it's quite small and farang-orientated. Similar to a cafe, internet cafe or a bookshop)

There's just too many unknowns right now, though. i can't calculate the risk. I know there's a lot of details and fiddly things, but generally would you say it's a smooth course to travel? Or are there too many hurdles to just dive in and grab this op?

I have learnt that the previous owner was here for close to a decade, and was forced to bounce in and around on different short term visas... is this normal? Is this what a lot of you guys are doing?

Thanks so much!

Hi,

As someone who has ran a couple of business's in Thailand here is my advice for what it's worth.

Firstly you've only been here 4 months in my opinion and a lot of other guys will say the same it's not long enough give it a year or so before committing to anything, keep looking around other opportunities will arise I assure you.

You have a choice in the way you set up the company

1.all in a trusted Thai's name

or

2. going legit with a Thai company 49% in your name - This will cost you to set up and then a big chunk every month - depending on how much you are going to be making in profit every month, you have to decide if it's worth it or not.

As the other posters have said do your due dilligence, spend a lot of time there,, don't rely on his figures, find out how much he is paying rent, elec, staff etc, what he's paying for stock work out the break even point and then take turns with your girlfreind seeing what he sells over a week. The last 4 months you have been here have been the high season, what's the business like when the tourist have gone home?

I could go on and on but I won't bore you.

[funfun]

Hiya!

I've been in Thailand for just over 4 months now, bouncing around with 1 month visa runs and 2 + 1 tourist visas.

Despite promising everyone I wouldn't, I've fallen for a lovely thai girl and after living together for a few months, have decided to try and settle and possibly venture into business together.

I've read around the forums, but would like some specific advice anyone can give me:

(Aplogies if my questions are answered elswhere, just let me know)

We have the jump on a pretty good business opportunity. If it was in Australia (my country of origin) I would snap it up and gladly accept the financial risk (investment looks between 800,000 to 1,000,000 baht) since it is already a proven a profitable business that we would be taking over right away (sorry, it's on the qt for the moment guys - don't know who's on these forums. Could be the competition, you know. But I can tell you it's quite small and farang-orientated. Similar to a cafe, internet cafe or a bookshop)

There's just too many unknowns right now, though. i can't calculate the risk. I know there's a lot of details and fiddly things, but generally would you say it's a smooth course to travel? Or are there too many hurdles to just dive in and grab this op?

I have learnt that the previous owner was here for close to a decade, and was forced to bounce in and around on different short term visas... is this normal? Is this what a lot of you guys are doing?

Thanks so much!

Hi,

As someone who has ran a couple of business's in Thailand here is my advice for what it's worth.

Firstly you've only been here 4 months in my opinion and a lot of other guys will say the same it's not long enough give it a year or so before committing to anything, keep looking around other opportunities will arise I assure you.

You have a choice in the way you set up the company

1.all in a trusted Thai's name

or

2. going legit with a Thai company 49% in your name - This will cost you to set up and then a big chunk every month - depending on how much you are going to be making in profit every month, you have to decide if it's worth it or not.

As the other posters have said do your due dilligence, spend a lot of time there,, don't rely on his figures, find out how much he is paying rent, elec, staff etc, what he's paying for stock work out the break even point and then take turns with your girlfreind seeing what he sells over a week. The last 4 months you have been here have been the high season, what's the business like when the tourist have gone home?

I could go on and on but I won't bore you.

Good advice!!

[jstumbo]

You have a choice in the way you set up the company

1.all in a trusted Thai's name

or

2. going legit with a Thai company 49% in your name

This is what I never liked about setting up a company in Thailand. Unless you are investing large amounts, you have to be the minority shareholder in your own company.

This is probably why the current owner's girlfriend owns the company. Because they created a company and she is either the sole owner, or she owns 51% and he only owns 49%. So she calls the shots with all of his money. Works great now, but what happens later when the relationship breaks down?

Luckily I am from the US, so I would never get stuck in this situation. Let's hear it for the treaty

[anonymouse]

You have a choice in the way you set up the company

1.all in a trusted Thai's name

or

2. going legit with a Thai company 49% in your name

This is what I never liked about setting up a company in Thailand. Unless you are investing large amounts, you have to be the minority shareholder in your own company.

This is probably why the current owner's girlfriend owns the company. Because they created a company and she is either the sole owner, or she owns 51% and he only owns 49%. So she calls the shots with all of his money. Works great now, but what happens later when the relationship breaks down?

Luckily I am from the US, so I would never get stuck in this situation. Let's hear it for the treaty

Probably not, I should think she owns the business because it is a small company that does not have to pay tax or social security for staff or work permits etc that a westerner has to.

If the op wanted to set up a company, he can still be the sole director and the only one with voting rights regarding any decision made. The company can also be set up so that he owns preference shares at a 10:1 ratio of the Thai shares.

IMHO if the business makes any less than 50,000 a month profit I'd stick it in a Thai name.

[lingyuk]

Hiya!

I've been in Thailand for just over 4 months now, bouncing around with 1 month visa runs and 2 + 1 tourist visas.

Despite promising everyone I wouldn't, I've fallen for a lovely thai girl and after living together for a few months, have decided to try and settle and possibly venture into business together.

I've read around the forums, but would like some specific advice anyone can give me:

(Aplogies if my questions are answered elswhere, just let me know)

We have the jump on a pretty good business opportunity. If it was in Australia (my country of origin) I would snap it up and gladly accept the financial risk (investment looks between 800,000 to 1,000,000 baht) since it is already a proven a profitable business that we would be taking over right away (sorry, it's on the qt for the moment guys - don't know who's on these forums. Could be the competition, you know. But I can tell you it's quite small and farang-orientated. Similar to a cafe, internet cafe or a bookshop)

There's just too many unknowns right now, though. i can't calculate the risk. I know there's a lot of details and fiddly things, but generally would you say it's a smooth course to travel? Or are there too many hurdles to just dive in and grab this op?

I have learnt that the previous owner was here for close to a decade, and was forced to bounce in and around on different short term visas... is this normal? Is this what a lot of you guys are doing?

Thanks so much!

Hi,

As someone who has ran a couple of business's in Thailand here is my advice for what it's worth.

Firstly you've only been here 4 months in my opinion and a lot of other guys will say the same it's not long enough give it a year or so before committing to anything, keep looking around other opportunities will arise I assure you.

You have a choice in the way you set up the company

1.all in a trusted Thai's name

or

2. going legit with a Thai company 49% in your name - This will cost you to set up and then a big chunk every month - depending on how much you are going to be making in profit every month, you have to decide if it's worth it or not.

As the other posters have said do your due dilligence, spend a lot of time there,, don't rely on his figures, find out how much he is paying rent, elec, staff etc, what he's paying for stock work out the break even point and then take turns with your girlfreind seeing what he sells over a week. The last 4 months you have been here have been the high season, what's the business like when the tourist have gone home?

I could go on and on but I won't bore you.

Great Advice, thanks...

My GF has been working in this store for about 2 years... in fact, she has been ordering stock, employing staff, paying taxes... everything! for a wage far below her position.

This guy has been using her skills to his advantage for some time, and now it looks like hopefully she'll be getting paid her due worth.

This is another reason why I feel uncommonly confident with this investment... I'm looking at the books for the past year right now. We should make back our investment in the first 6 months. It's been running for over 10 years at a healthly profit.

Oh, and anonymouse, don't worry, you're not boring us!

Edited March 13, 2008 by lingyuk

[lingyuk]

US Treaty?? Lucky buggers, Where can I read more abou this.... hmmm...

[midas]

You have a choice in the way you set up the company

1.all in a trusted Thai's name

or

2. going legit with a Thai company 49% in your name

This is what I never liked about setting up a company in Thailand. Unless you are investing large amounts, you have to be the minority shareholder in your own company.

This is probably why the current owner's girlfriend owns the company. Because they created a company and she is either the sole owner, or she owns 51% and he only owns 49%. So she calls the shots with all of his money. Works great now, but what happens later when the relationship breaks down?

Luckily I am from the US, so I would never get stuck in this situation. Let's hear it for the treaty

Probably not, I should think she owns the business because it is a small company that does not have to pay tax or social security for staff or work permits etc that a westerner has to.

If the op wanted to set up a company, he can still be the sole director and the only one with voting rights regarding any decision made. The company can also be set up so that he owns preference shares at a 10:1 ratio of the Thai shares.

IMHO if the business makes any less than 50,000 a month profit I'd stick it in a Thai name.

I have a couple of questions. Are you sure your advice regarding preference shares is up-to-date?

I have lost track as to exactly what stage we are at regarding the Foreign Business Act

but I thought that was going to essentially stop results arrangements.

The other thing is, no one has mentioned the all-important " work permit " ? Surely if

the business which the OP is considering doesn't generate enough to pay his salary

plus the 4 employees, he will not legally be able to get involved at all in running the business?

[lingyuk]

Probably not, I should think she owns the business because it is a small company that does not have to pay tax or social security for staff or work permits etc that a westerner has to.

If the op wanted to set up a company, he can still be the sole director and the only one with voting rights regarding any decision made. The company can also be set up so that he owns preference shares at a 10:1 ratio of the Thai shares.

IMHO if the business makes any less than 50,000 a month profit I'd stick it in a Thai name.

Interesting....

It has an average income of 115,000 a month (high and low season)

with about 68,000 profit after expenses

Still think I should stick it in her name?

i think the previous owner did that to save money - for all the reasons you said.

[jstumbo]

It is called the Treaty of Amity. Just put it in the search box at the top of the forum. There are many threads on it. Basically it is just a treaty that Thailand signed with the US ages ago that allows a US citizen to register a company and own 100% of the company instead of the need to find a Thai proxy to own 51% of your company. They keep threatening to get rid of it, something to do with the WTO and giving an unfair advantage to US companies.

[lingyuk]

work permit... yes..

I am a little confused about the law that you can own a business but not work in it without a work permit... can your own business sponsor you for your work permit?

I'm a newbie I know, so much research to do...

[lingyuk]

i can't stop staring at that elephant. Up and down and up and down...

[jstumbo]

The other thing is, no one has mentioned the all-important " work permit " ? Surely if

the business which the OP is considering doesn't generate enough to pay his salary

plus the 4 employees, he will not legally be able to get involved at all in running the business?

The salary and Thai employees is a requirement for an extension of stay. So he would just have to keep bouncing out of the country for border runs if he could not meet these requirements.

[lingyuk]

Where can I see these requirements? Thanks

[anonymouse]

You have a choice in the way you set up the company

1.all in a trusted Thai's name

or

2. going legit with a Thai company 49% in your name

This is what I never liked about setting up a company in Thailand. Unless you are investing large amounts, you have to be the minority shareholder in your own company.

This is probably why the current owner's girlfriend owns the company. Because they created a company and she is either the sole owner, or she owns 51% and he only owns 49%. So she calls the shots with all of his money. Works great now, but what happens later when the relationship breaks down?

Luckily I am from the US, so I would never get stuck in this situation. Let's hear it for the treaty

Probably not, I should think she owns the business because it is a small company that does not have to pay tax or social security for staff or work permits etc that a westerner has to.

If the op wanted to set up a company, he can still be the sole director and the only one with voting rights regarding any decision made. The company can also be set up so that he owns preference shares at a 10:1 ratio of the Thai shares.

IMHO if the business makes any less than 50,000 a month profit I'd stick it in a Thai name.

I have a couple of questions. Are you sure your advice regarding preference shares is up-to-date?

I have lost track as to exactly what stage we are at regarding the Foreign Business Act

but I thought that was going to essentially stop results arrangements.

The other thing is, no one has mentioned the all-important " work permit " ? Surely if

the business which the OP is considering doesn't generate enough to pay his salary

plus the 4 employees, he will not legally be able to get involved at all in running the business?

You could be right, my company is a few years old now and was initially used to buy my house.

It doesn't matter if the op is earning less than the required amount as long as he pays the tax due on it, eg if he earns 25,000baht salary he will still have to pay tax on 50,000

Same goes for the staff, as long as he is paying social security on 4 staffs wages - he is ok, could be his girlfriends mother, whoever

[jstumbo]

English Translation of Police Order 606/2549

English version of Thailand Immigration Website

Be warned though that the website is not the most up to date information.

Edited March 13, 2008 by jstumbo

[anonymouse]

It has an average income of 115,000 a month (high and low season)

with about 68,000 profit after expenses

Still think I should stick it in her name?

i think the previous owner did that to save money - for all the reasons you said.

I've been out here 12 years and in hindsight I'd have done a lot of things differently but probably if I'd been here 4 months met a nice girl and had the money, I'd of bought the business and stuck it in her name.

Now I'm older, cynical and more jaded I'm more hesitant

As for should you stick in her name - that's your call.

[kiakaha]

You have a choice in the way you set up the company

1.all in a trusted Thai's name

or

2. going legit with a Thai company 49% in your name

This is what I never liked about setting up a company in Thailand. Unless you are investing large amounts, you have to be the minority shareholder in your own company.

This is probably why the current owner's girlfriend owns the company. Because they created a company and she is either the sole owner, or she owns 51% and he only owns 49%. So she calls the shots with all of his money. Works great now, but what happens later when the relationship breaks down?

Luckily I am from the US, so I would never get stuck in this situation. Let's hear it for the treaty

I noticed OP is Aussie. NZL has a free trade agreement that, in certain industries and situations, you can have 100% directorship and shareholding of a Thai company. A quick google reveals that Aus has similar outcomes in their FTA...http://www.dfat.gov.au/trade/negotiations/aust-thai/service_outcome_benefits.html

Not really for small mom & pop operations, but none the less, useful stuff to know.(Disclaimer, embassy staff in LOS are generally useless and retarded when asking for support on FTA matters )

Edited March 13, 2008 by kiakaha

[WatersEdge]

You have a choice in the way you set up the company

1.all in a trusted Thai's name

or

2. going legit with a Thai company 49% in your name

This is what I never liked about setting up a company in Thailand. Unless you are investing large amounts, you have to be the minority shareholder in your own company.

This is probably why the current owner's girlfriend owns the company. Because they created a company and she is either the sole owner, or she owns 51% and he only owns 49%. So she calls the shots with all of his money. Works great now, but what happens later when the relationship breaks down?

Luckily I am from the US, so I would never get stuck in this situation. Let's hear it for the treaty

The treaty expired