What Sort Of Money You Need To Open A Business

[Donz]

Hi all,

ill probaly get some abuse from this like people saying "i wont tell my idea because you will steal it" and all the other crap.

Anyways, does anyone have any idea's what you can do with 300,000 baht??

Or maybe 1 million baht??

Im sure there are some good business men and woman here, can you give me some advise on what you would do with it or what you think would be a good idea?

I was thinking about clubs near tourists hot spots but i heard that you wont get a pub (a good one) unless you know some of the mafia. (just what i heard)

Please feel free to tell some of your success stories.

[davethailand]

300000bht or million will not get you very far at all.

Where are you thinking?

Don't listen to the mafia crap.

[GuestHouse]

Richard Branson started with 100 quid.

[Ajarn]

Only spend what you can afford to lose

In Chiang Mai, I'd say 1 million baht will buy you 1/2 interest in a bar that loses money....

[davethailand]

Richard Branson started with 100 quid.

yeh but he were'nt in Thailand

[Donz]

Not sure yet, i love chiang mai, was thinking about a tour agencie, or maybe buy a few ATV's (4 wheel more bikes for newbies) and doing adventure rides.

I was thinking about putting internet cafes and gaming rooms in BKK domestic airport because every flight is delayed, but ive been advised the new airport will alreay cover that.

Ive seen a few mobile pubs that have done really well in BKK but it lookis like abit of a pain in the ass to find the good spots.

300,00 and 1 million baht was just an example, if you got any good ideas that invole more cash then lets here them.

I know boats are very cheap in SE asia and doing kayaking and snorkling tours would be good too.

[Upcountry]

This may not be what you had in mind, or perhaps you've already checked out Bualuang Securities - connected to Bangkok Bank - as a way to invest your money in Thailand.

http://www.bualuang.co.th/en/index.php

http://www.set.or.th/en/info/brokers/broker01.html

Edited January 19, 2006 by Upcountry

[soic]

I believe it' important to define your goals as well. If you're looking for a huge profit, Good Luck! If you're looking at financing a life in Thailand that's easy enough. Also, if you have a Thai spouse, that's a big plus. Myself, I married a wonderful Thai lady, we've done everything in her name. I know it's a risk, but as she's 40, I'm 43 and we're set up in a remote province, I don't see the risk as too high. I can't work in the store or restaurant so I work on the internet. I work my internet business everywhere I go.

If you're looking for the big returns, I believe that you'll have to invest huge capital. Basically in the high tourist areas, you'll be competing over a small market, tourists. They have the big bucks. There is a lot of competition for them, Thai business and Farang alike. If you go more rural, you're competing over a thai market, small dividends, small returns. Your goals will determine the amount of investment you need to make. I can think of several small business ventures... they will have small returns though. A true Pizza cart... would be a high demand item in tourist areas and the ovens and vehicle set up is affordable. You also have to work out the visa and work permit issue. Those can be hard to get and costly.

Good luck in whatever you decide to do...

I believe it' important to define your goals as well. If you're looking for a huge profit, Good Luck! If you're looking at financing a life in Thailand that's easy enough. Also, if you have a Thai spouse, that's a big plus. Myself, I married a wonderful Thai lady, we've done everything in her name. I know it's a risk, but as she's 40, I'm 43 and we're set up in a remote province, I don't see the risk as too high. I can't work in the store or restaurant so I work on the internet. I work my internet business everywhere I go.

If you're looking for the big returns, I believe that you'll have to invest huge capital. Basically in the high tourist areas, you'll be competing over a small market, tourists. They have the big bucks. There is a lot of competition for them, Thai business and Farang alike. If you go more rural, you're competing over a thai market, small dividends, small returns. Your goals will determine the amount of investment you need to make. I can think of several small business ventures... they will have small returns though. A true Pizza cart... would be a high demand item in tourist areas and the ovens and vehicle set up is affordable. You also have to work out the visa and work permit issue. Those can be hard to get and costly.

Good luck in whatever you decide to do...

[Noel]

Please feel free to tell some of your success stories.

If you do not have your own idea from which you can formulate a realistic business plan, forget it.

[Heng]

I stand by compound interest as the greatest business and mathematical tool.

I'd also say... don't listen to those who say X amount isn't enough. Start small, pay attention to the details, don't borrow or finance, save and reinvest.

[Khun Jean]

Amen!

[johnnyk]

Its not easy, especially if your ideas are vague and you don't have a lot of money.

Don't even think about anything to do with airports, IMO.

Areas like that are the domain of the connected; there is money to be made from captive audiences.

Internet cafes are a race to the bottom.

Technology and software (games etc) have to be constantly upgraded, there is NO customer loyalty as it is basically a generic commodity and somebody can do it cheaper or get a better location. Not to mention as soon as it shows any sucess competitors will open next door and the small pie ends up being split X ways so nobody wins.

An example, I use an internet place in Hua Hin that is air-con, has cold drinks, clean and up-to-date computers...its 20baht an hour! How the hel_l he makes any money is beyond me.

Tourist season is short and a guest house can provide a living.

But one million won't get you much, you will never own it and then you are vulnerable to rent increases and landlord machinations.

Lots of boats, kayaks and diving businesses for sale. I wonder why.

ATVs mean you would have to know the terrain. Stray on to someone's land and you will pay (falang=money). And Somchai and his pals will soon have an ATV biz next door to you.

[Heng]

An example, I use an internet place in Hua Hin that is air-con, has cold drinks, clean and up-to-date computers...its 20baht an hour! How the hel_l he makes any money is beyond me.

They can also write/translate letters for about 100-300 Baht per letter/email. Doesn't sound like much but it adds up (especially when the average "letter" is just a paragraph).

And even then, 20 Baht an hour times X computers adds up if he/she isn't renting. Utilities only as your main overhead is one of Thailand's great advantages.

Or, there's option C.... did you check to see that the shop is really just a 'secret' entrance to the casino upstairs?

Edited January 20, 2006 by Heng

[Boon Mee]

I stand by compound interest as the greatest business and mathematical tool.

I'd also say... don't listen to those who say X amount isn't enough. Start small, pay attention to the details, don't borrow or finance, save and reinvest.

Compound interest = 8th wonder of the world.

[peter991]

If you are really serious about investing money in Thailand and buying a business, the best thing you can do is to visit Sunbelt Asia website and get on their weekly mailing list.

There is a wealth of information on their homepage and it's a must read before you start. Otherwise you will probably end up throwing your money away.

Two suggestions:

1. Never invest more than you are prepared to lose.

2. Spend at LEAST 12 months in Thailand as a VISITOR getting the feel of the place BEFORE you invest anything. That way your have seen the 'low' and 'high' seasons.

Peter

[~G~]

Anyways, does anyone have any idea's what you can do with 300,000 baht??

The best "Idea" will not do if you do not posses the skills to implement it. Give 300,000 baht to a gifted enterpreneur and he'll double it in a year; give 300 million baht to an idiot, he'll loose it all within the same period.

The way for you to make money depends on your skills; one cannot give a general advice, correct to all. Find your edge, what can you do better than others. If you don't have such an edge; develop one. If you cannot do that as well, forget about starting a business, there is no magic formula.

[Sunbelt Asia]

Don't even think about anything to do with airports, IMO.

Areas like that are the domain of the connected; there is money to be made from captive audiences.

Very true. The rent being asked is for the new airport is high.

2,000 Baht a sq.m. per month for key money payable in advance for 5 years.

900 Baht a sq.m. per month base rent

25% of your gross sales with a guarantee minimum of 9,000 Baht a sq.m. per month.

Hence if you are looking at 92 sq.m. you need to pay

11,040,000 in key money( Gift) plus a minimum of 910,800 in rent per month.

If you are doing sales of 5 million you are paying 1,516,800 in rent per month ( which includes the pro rata key money per month of 2,000 Baht per sq.m.) which is 30% of your gross sales.

This is why the selling price of goods has to be higher at the airport than anywhere else in Thailand otherwise the vendor will lose money.

www.sunbeltasia.com

[LivinLOS]

Are you looking for something to really pay your way or just a tickover thing to keep the missus happy..

I would be happy to put some small money into something small to keep the GF busy but here in Patong phuket even a small biz seems to take more input (if its got any kind of chance of success, locations etc) than I think is reasonable..

One surprise was what a mate has done with his wife.. Year or two back bought 4 scooters on credit with the fastest payment plan.. Apart from putting the 10k or so per bike down they are more than paying for themselves (she gets 4500 per month on a brand new neuvo or mio, down to 3k for an older wave etc)..

After one year thats pure income (paid of the purchase).. Last time I went round I find out they had 8 bikes and she was buying 2 more then.. She does have a lot of contact with the bar girls and will extend them the odd bit of credit etc, doesnt mess with daily rentals or even much weekly stuff, mostly its long term rents she looks to hook into.

Now I know that sounds like small beer but when you think about it shes now getting (lets just imagine all bikes have had thier first year paid off) 40k or so out of just 10 bikes.. Maintenance is low and any damage and the bikes get paid for (in fact they have ended up making money out of damage and replace old bikes for new out of someone elses pocket).. Her sum input is washing the odd bike and hassling the very few rentees for thier monthlies.. Total start up capital was small enough to not worry about and they are left with the 'stock' at any time as they have bought something tangible. Its a biz that she can handle without instruction and gives her some freedom. As she gets more well known they just keep adding more bikes out on long term rents.

I am not suggesting its enough to keep anyone in high style but I did think it was a very low input biz that made an easy respectable return. Perhaps the high demographic of BG's who dont feel permanent in one place long enough to want to buy and have customers money to spend makes that happen here and not elsewhere..

[Cassandra]

Richard Branson started with 100 quid.

and a millionaire father, and an expensive public school education.Like Rupert Murdoch.A better eample would be Alan Sugar who made his fortune without any advantages of background.

[~G~]

Don't even think about anything to do with airports, IMO.

Areas like that are the domain of the connected; there is money to be made from captive audiences.

Very true. The rent being asked is for the new airport is high.

2,000 Baht a sq.m. per month for key money payable in advance for 5 years.

900 Baht a sq.m. per month base rent

25% of your gross sales with a guarantee minimum of 9,000 Baht a sq.m. per month.

Hence if you are looking at 92 sq.m. you need to pay

11,040,000 in key money( Gift) plus a minimum of 910,800 in rent per month.

If you are doing sales of 5 million you are paying 1,516,800 in rent per month ( which includes the pro rata key money per month of 2,000 Baht per sq.m.) which is 30% of your gross sales.

This is why the selling price of goods has to be higher at the airport than anywhere else in Thailand otherwise the vendor will lose money.

www.sunbeltasia.com

Wanted to get a scarf in the airport the other day. They wanted to sell me one for 6,000 baht.

[Farma]

The OP didn’t mention his wife’s education. If she has qualifications, IE medical, dental, pharmaceutical, massage therapy, travel etc plus business management skills she’ll be able to open her own clinic/agency for the amount mentioned. Medical or dental equipment will take the start up cost closer to the upper amount.

Remember location and good business sense is the key to success. Use the wife’s local knowledge

With the amount the OP suggested, look where rents are cheaper, away from tourist areas, except the travel agency idea where a small office with plenty of potential foreigner customers would be beneficial.

Rent the building, don’t buy. Expect 2 years rent up front. Check for any official business building/office requirements before signing the lease. Some businesses have requirements for enclosed areas or entry exit restrictions.

Find a good location with little or no competition, rent a shophouse (you can always live in the back), set the business up and see how it works. Start off small and be prepared for long working hours and to pour the profits back into the business for the first year. Use the profits to improve or expand the business.

If the original location isn’t as good as expected the business can always change locations for minimal cost. The business will have its own equipment, signs and stock by then.

Remember, if you don't feel comfortable with the business idea it could be a subconscious doubt telling you to research more.

[Heng]

Richard Branson started with 100 quid.

and a millionaire father, and an expensive public school education.Like Rupert Murdoch.A better eample would be Alan Sugar who made his fortune without any advantages of background.

True, but there are also at least a million out there with millionaire fathers though who will never be able to do what Branson did. I think no matter what the starting point (even for those with fairly solid family foundations), there's a long way to run if you want to build something up.

Edited January 20, 2006 by Heng

[soic]

Like I was saying before... it depends on what your goals are. If you want major profit, good luck. If you want to get by and finance a life here, that's doable. Figure out what your long term goals are. Once you have those, you plan and build a business that will give you the returns to meet those goals.

Just a few questions that will determine a portion of your investment:

Are you single or married to a thai?

What visa's will you need to get the business you want?

Work permits?

Will you need to form a company? Share holders?

[Butterfly]

Richard Branson started with 100 quid.

and a millionaire father, and an expensive public school education.Like Rupert Murdoch.A better eample would be Alan Sugar who made his fortune without any advantages of background.

I love those self-made millionaires myths. Bill Gates, Murdoch et al are all trust fund heirs.

Only Oracle CEO is the real thing. He claimed he was picking up trash when he was 10 and he started Oracle with 1,000

But who knows, he could also be a fraud

Do you guys really think that the capitalist system will let the poor go to the top in less than a few decades ?

[Jersey_UK]

and all the other crap.

Welcome to TV

I do not have any story of doing business in Thailand (succesful or otherwise ).

Way back, when I thought I wanted to move to Thailand 24/7 I was also thinking of starting / investing small scale in a business on the basis that I could learn the ropes in Thailand without risking my financial future - but I decided against it, because for the amount of time and effort, the rewards were just not there (for me, and given my skills), because I valued my time and effort in "real" money. (I admit here that for others the "value" put on being IN Thailand 24/7 will be a lot higher than it was for me then, let alone now!)

Even if I had "serious" money to buy / build a business in Thailand, where the returns might have the potential to be justifiable, I still wouldn't. Plenty of other places and ways in the world to invest money. The rule of law in Thailand is in PRACTICE just not good enough for ME to invest any serious money - if I had any

I would suggest that whatever you do - start small and rent - just to get first hand experiance - you can always decide later to walk away or expand or relocate or try something else...........but by then you will KNOW in practice what you are dealing with and be able to weigh up the risks vs the rewards............ in Thailand. Spending money with the Thais is one thing......when the cash goes the other way is a bit different.

Having said all that I wouldn't say do not try something - especially if part of the attraction is to keep your brain ticking over in the LOS.

[RAZZELL]

Great post LivinLOS...

Something I might get one of my friends interested in...

Minimal effort..reasonable return.. (in Thai terms)

[ThaiPauly]

You may want to consider a 7-11 franchise!

It's not that much going in as they take 52% of your profit... BUT I have NEVER seen one close down.. so they MUST STILL be all making money!

I think though from my research that you can put more in "up front" and they will take a smaller slice of the profit.

They will find you a location, put in a Manager, until you have learnt the ropes etc.

I highlighted a few places in CM that could use a "7".

I beleive their head office up here is above the store on the corner of Chaingmai Land if you are interested in knowing more,(but that is accordig to my Wife ) or visit their website.

For myself, I had two unsuccessful attempts to launch businesses out here which cost me 2m baht.

After then doing a lot of research, we eventually found a rather lacklustre restaurant BUT had a fabulous cook, there had never been any attempt to promote the place so we refurbished it, put ALCOHOL in (by that I mean spirits of any sort or cocktails etc were not avialable before) and stayed open later. (Previously the place closed at 5pm)

We are now doing good business after 4 months of hard work (on my Wife's part). As trade can be very seasonal up here we are now formulating a marketing campaign that should see us through the thin times.

I must have looked at 50 business opportunities up here before I eventually bought one, and then did not spend much to buy it, I would imagine with takings as they are now that we would get substantially more for it than we paid, even though we spent money on the refurb.

BUT it will take me a long time to recoup my total financial losses in Thailand.

Just be very careful, and don't fly headlong into the first opportunity that presents itself unless you have thought it through thouroughly, and as Ajarn said, do mot invest more than you are prepared to loose.

Good Luck

TP

[johnnyk]

Not so sure you are entirely correct about 7/11.

My guess is that 7/11 owns the premises (land & building) or has a very long lease.

They then sell the franchise to someone.

That 7/11 person may go belly up and we wouldn't know it. The store stays open, a new franchisee is behind the scenes and the same girls out front.

Samesame McD, franchisees seldom ever (maybe never) own the land, bricks, mortar and formica.

[Heng]

A friend of mine has a few 7-11's and CP is renting out the bottom floor and second floor of one of my buildings that is then run by a franchisee. The folks at one of the business advisor groups probably know more in detail, but I believe there are two franchise opportunities offered by CP.... type A and type B. One is where A) you already own or rent the location and one is where CP already owns or rents the location. You have to buy the initial stock in both instances, but the profit share percentages (42-46% of your gross paid to CP are the #'s I hear thrown around) vary. The initial stock runs you about 3,, million. If you have your own location your odds of success are obviously better, as most people will tell you that the type B locations are CP's LEAST profitable locations (as is often the case when you buy pre-existing businesses).

[Khun Jean]

Problem is that in CP's mind it is no problem to open a 7-11 within a 100 meter radius. Effectively splitting the profit in 2. Seen some places with 3 7-11's and 3 other supermarkets in 1 street. It just asking for problem.

In my opinion CP's strategy is filling their pockets with ZERO protection for the actual entrepeneur who invests. But 'mai pen rai'.