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Why Some Ex Pats Businesses Succeed, while others don't
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Author:  TimBones [ Fri Oct 22, 2010 5:45 pm ]
Post subject:  Why Some Ex Pats Businesses Succeed, while others don't
Been thinking about why some Ex-Pat owned/run businesses fail in Costa Rica while others succeed. I am not looking for a MBA thesis, but more anecdotal information on why some businesses find a terrific niche, such as the Dunn Inn, HLH and of course the Sportsmen’s Lodge, while others such as Dos Gringos, Shannon Irish Pub, go under. I have a host of ideas, such as under-capitalization, lack of supervision, not understanding local business environment, just to name a few thoughts.
On my first trip back to CR after about 10 years, I had the opportunity to talk to Bill for a while and accompany him to the CRT party at the then Zona Blue, his off the cuff statement to me was “Well, San Jose is short 500 or so hotel rooms” and I think Ex-Pats that offer services in that area have a better than even chance of succeeding as evidenced by those same hotels. So, I guess I would like to hear opinions about other keys to success as opposed to hearing the old adage about how to make a million dollars in SJ…… :)
Author:  Xman00 [ Fri Oct 22, 2010 10:11 pm ]
Post subject:  Re: Why Some Ex Pats Businesses Succeed, while others don't
as some who has to deal with failed business daily here in the states my experiences shows that a good share of the failures fall into just a few areas, besides the one you mentioned and I feel will be universal.

1) not being a businessman ( or woman) running a business is a skill. and a skill that not every one can learn or deal with. Some of the lucky ones seem to born with that skill.This skill is hard to explain and not something that can be learned out of a book,and smarts are not the most needed ingredient of the skill, risk taking, imagination,ability not to be bothered by failure, leadership-ability to make decisions are just a few. ie- why would you under fire follow a private up the hill but not the Captain, nothing that you can put a finger one but few have it. That is why most of us are Indians and not Chiefs

2) Friends/relatives who for lack of a better world are leaches who consider your business free for them to use and abuse

3) understanding that you have to WORK the business 24 hours a day 7 days a week when you start, not hiring out every thing - to many owners start out thinking they can sit and watch the money flow in and never lift a finger-- some times the owner has to clean the plugged toilet.

4) if alcohol is involved, knowing how to say NO. Sitting one side of the bar for 20 years does not qualify you to sit on the other side the next day.

5) failure to keep good records of funds coming or going out ie- if you are selling 100 Snickers bar a night, but you are only buying 25 a month you might have a problem ( actual story)

while I may not have mentioned specific things to SJ, but any person who can avoid the above should very easily adj, or learn very quickly how to adj to local conditions,--- disclaimer Mafia control or Mafia government/police that you only will find out about after you are a success will affect "stuff" and not in the good way.

Then you have the things that only some one who has lived in the city/providence/county might know are in my opinion easy for a True Businessman to easily conqueror or know enough to get out fast. A good business man knows enough to close the doors and move on to something else fast

Few among us are Chiefs, most of us are just Indians

ps I am an Indian - who can never make all the conditions of the #1, only some, but can make qualify for the last 4, and I greatly envy those who are Business Men or Chiefs
Author:  Estebanh [ Sat Oct 23, 2010 7:29 am ]
Post subject:  Re: Why Some Ex Pats Businesses Succeed, while others don't
Xman,
Great post. I would add a little. The sad fact is, MOST businesses fail! Even in a strong economy, one's chances of success are slim. Those that do survive and thrive are the exceptional ones (and everyone should admire them). To succeed in small business, ones must have big cahones, financial depth and long term staying power.
Author:  Thirdworld [ Sat Oct 23, 2010 11:36 am ]
Post subject:  Re: Why Some Ex Pats Businesses Succeed, while others don't
Substance problems and using your business to impress chicas, or using money that should be applied to the business to impress chicas. I've seen many guys trying to be players just spend too much of their capital and crap out. Thinking you can just throw money at a business and it will succeed. I'm sure Bill has a good time at the SL, but if you notice, that guy is always working. Making sure that everyone has a good time and things go well. Same for BKtuna. They have work ethic..
Author:  Dean [ Sun Oct 24, 2010 12:04 am ]
Post subject:  Re: Why Some Ex Pats Businesses Succeed, while others don't
I agree with Xman especially whe it comes to some have it and some don't. You have to really like what you are doing because it should be on your mind 24/7. Everybody likes to think when they see a place like SL, I could do that. Well, you probably didn't see it in the beginning when it was 1/10th of the business it is now. I bet True Sportsman was 24/7 and probably had a room there in the beginning (a guess).

Serve a quality product!!!!! People will always come back.

I must say I have been extremely lucky to be a business partner with my brother. Most of the time, working within families or friends fails bcs people do not know how seperate business expectations from family/frienship ones. My best friend (35+ yrs) wanted to open up a restaurant with me. I told him I value the friendship more than another store so I declined.

Realize not every decision will have a positve outcome. You better have the stomach to make mistakes. Do not blame everyone around you in bad times. In fact you better be looking on how YOU can be doing more. It is your business and the consequences will always be yours.

TW is also 1000% correct. People using the business instead of nurturing it will destroy it. The last person to get paid is the owner. You don't push bills out another week. Employees are always paid. There is never an excuse to not pay the person that has worked for you. You do not borrow from your business, it has to be treated as a seperate entity, even though it is yours.



Dean
Author:  Phoenix Rising [ Sun Oct 24, 2010 1:26 am ]
Post subject:  Re: Why Some Ex Pats Businesses Succeed, while others don't
6) Lack of due diligence or disregarding red flags in due diligence.

Many enterprises are doomed to failure because there was never a chance they would have succeeded in the first place. Yet many would-be enterpreneurs...

1. jump into situations without taking the time to thoroughly educate themselves about every little detail regarding their new venture or

2. do some research but ignore the numbers that show a biz will likely fail...

Usually because they are so in love with the dream of being their own boss...and in Costa Rica !!

Kinda like catching feelings for a hooker! :wink:
Author:  Icantstayaway [ Sun Oct 24, 2010 10:54 am ]
Post subject:  Re: Why Some Ex Pats Businesses Succeed, while others don't
Quote:
I've always wanted to have my own bar


Now that sounds like a solid business plan !
Author:  BlueDevil [ Sun Oct 24, 2010 11:56 am ]
Post subject:  Re: Why Some Ex Pats Businesses Succeed, while others don't
Based upon my limited knowledge of gringo-owned businesses in the gulch, I would say that experience, knowledge, vision, commitment and the correct mix of resources count a lot. Some of the successful businesses I am familiar with, the owners have a vision and a target clientele in mind. These businesses are adequately capitalized (maybe very close to the bone in some cases :wink: ) and have owners that are hands-on. One exception, the Hotel Castillo, has an owner in abstentia, however, a very capable, trustworthy deputy (Darren) oversees the operation. I guess another ingredient for success, is a knowledge and respect of the local business environment.

The restaurants next to the Hotel Castillo have been case studies in failed business for as long as I've been a visitor to San Jose. The building is owned by the same guy who owns the hotel. But, the hospitalty businesses that have opened and closed ever since his Las Palmas restaurant (the first one), have been failures. Lack of capital, vision and attention to detail contributed to the downfall of these establishments. I am still not convinced that this restaurant is eternally cursed. I believe in the right hands, it could be developed into a viable business and a welcomed addition to the gulch.
Author:  Xman00 [ Sun Oct 24, 2010 12:43 pm ]
Post subject:  Re: Why Some Ex Pats Businesses Succeed, while others don't
Dean said "I must say I have been extremely lucky to be a business partner with my brother. Most of the time, working within families or friends fails bcs people do not know how seperate business expectations from family/frienship ones. My best friend (35+ yrs) wanted to open up a restaurant with me. I told him I value the friendship more than another store so I declined. "

My father ran the Caterpillar Dealerships in Wis for 15 years in the 60's-80's and he had a basic rule on that,
1) never work with the people you play with
2) never play with the people you work with

If you have avoided problems with your brother I say you two have a very strong compatible relationship from well before the business, and that is very good on both levels B and P- congratulations to you, that is a success few people in this world can claim. :D

But I have talked to to many who had so many problems in business with friends/families and even spouses that, that you are better doing the business alone to save both money and friendships. Money can do strange things to the best of friends.

Also by following both rules your save a lot on the sexual harassment( paternity ) :evil: lawsuits by your employees and self, but hey we go to SJ :D so it just be employees that need to follow that rule.
Author:  Xman00 [ Sun Oct 24, 2010 12:51 pm ]
Post subject:  Re: Why Some Ex Pats Businesses Succeed, while others don't
Phoenix Rising said "6) Lack of due diligence or disregarding red flags in due diligence.
Many enterprises are doomed to failure because there was never a chance they would have succeeded in the first place. Yet many would-be entrepreneurs...


Daily I run into people who have taken over a business location where the last 2-4 -5- 10 prior owners have failed, and are doing the exact same thing in the exact same way-- I do very thing in my power not to smack them up along side the head and demand a explanation on why they think they will succeed when every else has failed there-- there might be a reason no one is making money doing that there??? I know a account who has gotten rich reselling on land contract the same locations over and over to people who have not put any thought into that..
Author:  TimBones [ Sun Oct 24, 2010 2:32 pm ]
Post subject:  Re: Why Some Ex Pats Businesses Succeed, while others don't
Lots of good input so far. I would like to follow up and ask whether you all think that Bill's comment (TrueSportman) about SJ still having a shortage of 500 hotel rooms is still viable. It would seem that it is based on the new monger centric hotels that have sprung up in the past; the MM, Amistad, Dunn (change of ownership) FB and that have gravitated toward the CRT board by becoming sponsors. If that is the case, it would seem that it could be a good proposition to buy a small hotel or convert a house in or near the gulch. :D
Author:  Thirdworld [ Sun Oct 24, 2010 2:45 pm ]
Post subject:  Re: Why Some Ex Pats Businesses Succeed, while others don't
Barrio Amon TimBones. Call it the Clubhouse and have 6 moderate suites with a nice, but not fancy common area, bbq, big flat screen tv. :D
Author:  February [ Sun Oct 24, 2010 3:21 pm ]
Post subject:  Re: Why Some Ex Pats Businesses Succeed, while others don't
Xman00 wrote:
as some who has to deal with failed business daily here in the states my experiences shows that a good share of the failures fall into just a few areas, besides the one you mentioned and I feel will be universal.

1) not being a businessman ( or woman) running a business is a skill. and a skill that not every one can learn or deal with. Some of the lucky ones seem to born with that skill.This skill is hard to explain and not something that can be learned out of a book,and smarts are not the most needed ingredient of the skill, risk taking, imagination,ability not to be bothered by failure, leadership-ability to make decisions are just a few. ie- why would you under fire follow a private up the hill but not the Captain, nothing that you can put a finger one but few have it. That is why most of us are Indians and not Chiefs


as someone who owns 2, sold one on contract, only to see it fail and take back over...

All of your points are dead on! But, #1 said it all. Should be 1 y 1a. You take care of your first part, the rest just follows.
Author:  BlueDevil [ Sun Oct 24, 2010 4:10 pm ]
Post subject:  Re: Why Some Ex Pats Businesses Succeed, while others don't
TimBones wrote:
Lots of good input so far. I would like to follow up and ask whether you all think that Bill's comment (TrueSportman) about SJ still having a shortage of 500 hotel rooms is still viable. It would seem that it is based on the new monger centric hotels that have sprung up in the past; the MM, Amistad, Dunn (change of ownership) FB and that have gravitated toward the CRT board by becoming sponsors. If that is the case, it would seem that it could be a good proposition to buy a small hotel or convert a house in or near the gulch. :D


Keeping it all hypothetical, I would have been more inclined to open a monger-centric business in Costa Rica 2 or 3 years ago... than today. The economy and current tico administration are among the factors that put a damper on my "hypothetical" enthusiasm.
Author:  Bilko [ Sun Oct 24, 2010 9:00 pm ]
Post subject:  Re: Why Some Ex Pats Businesses Succeed, while others don't
I have personally known several of the owners of failed businesses in and around the gulch. In many cases, it is the old 'a fool and his money' adage. Guys who were successful in the USA or Canada doing something decide they want to 'do something' in Costa Rica. In most cases, the way they made their money (or found a backer) had little to nothing to do with what they decided to do in Costa Rica, or if it was similar (the Irish Pub where Baja Beach is now) it was a concept that was a bad fit for San Jose.

Most guys who presided over a failed business never had a real plan, never did their homework and didn't even speak enough Spanish to reprimand his employees. Most couldn't have distinguished a balance sheet from an income statement, or differentiated cash flow from profit. Too many thought 'hope' was equal to a 'plan' and it ain't. You can get away with things sometimes because you are in the right business or place at the right time. Several gulch businesses were started on inherited money. If you have enough you can be stupid for a long time.

Oh and I should mention those who think a business can run itself or that drunken supervision is adequate.
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