Can you run a successful business in Thailand?
The one conversation that trumps even that of the difficulties with getting a Thai Visa is making money in Thailand. It seems everyone who lands in Thailand is all of a sudden an expert in business and economics even if they've never been to Thailand or started a business before. Though for most people it's just a pipe dream, 1,000's of expats start up businesses in Thailand all the time, most fail miserably.
A good friend of mine likes to say "The only way to make a small fortune in Thailand is to bring a large fortune with you". While the newbies are all full of optimism as if Thailand is the new gold rush and anything you do will turn to gold soon get brought to reality when their small coffee shop on the outskirts of town runs out of money shortly after their beer bar wife returns to beach road.
I do know dozens of guys that actually do make good money 100,000 baht plus per month in Thailand and some even clear more than a million baht. The truth is those people actually brought in millions of dollars in order to clear a million baht a month.
While I didn't do a survey or anything scientific there are certain characteristics of those people that I do know that have succeeded in Business in Thailand.
- They have previous business experience.
- They own the property/building.
- They have the means.
The first point here having previous business experience is what I'm talking about. If you've never owned or run a bar before then your chances of succeeding are about 1 in 1000. If you've never owned or run coffee shop before your chances of lasting more than a year in business are about 1 in 100,000.
Secondly if you own the building you're protecting you're own investment. Let's say you rent a shop house, the business does well, the owner sees this and puts up the rent so now you're making nothing. You can't move the business you'll have to start all over again and all the fittings would have to be changed. Whereas if you own the building, whatever you put into the building you still own if the business falls over. When you sell you can sell everything. If you move out after renting you pretty much lose everything. Any appreciation in the building/land that occurs while you own it could help offset any losses that you occurred on running the actual business.
Finally while you don't need a million dollars to start up a successful business in Thailand you will need to be flushed with some cold hard cash. The following list shows you what you'll need if you want to follow the successful business guys in Thailand.
50,000 baht investment = Noodle Cart
4,000,000 baht investment = Coffee Shop
8,000,000 baht investment = Restaurant
If you're lucky enough to make those businesses work here's what you're likely to end up with at the end of the month
Noodle Cart = 10,000 per/month
Coffee Shop = 30,000 per/month
Restaurant = 60,000 per/month When someone in Thailand tells you that they don't make any money from their business in Thailand, really they mean they lose money every month.
If you can get a loan for half the amount of the building you could probably wipe 2,000,000 baht off those figures for investment but you honestly shouldn't go into the business if you can't buy the building outright as you'll lose way more money unless you need that 2,000,000 baht to see you through the crucial first 3 years of business. Assumed building costs 4,000,000 million.
As you can see that simply buying a noodle cart and making that work can make you a 6th of what a restaurant could potentially make but the restaurant would cost you more than 100 times what a noodle cart costs!
Remember in the beginning of this article I mentioned that only a few dozen people that I know run a successful business in Thailand. But there are thousands of guys I've met that live in Thailand from running their business from their laptop. And that's where the easiest money in Thailand and you don't need to invest millions of baht in order to make a paltry 60,000 baht a month.
Those guys who are running successful businesses in Thailand I take my hat off to them because I know all too well how difficult it is. Would I ever want to run my own business in Thailand? Maybe later, but a business in Thailand would require me to stay in one place for a long time, i'm not ready to commit to that just yet.
If I were to start a business in Thailand it would probably be a Short time hotel or Karaoke club what about you?