[Mr.GoodThread]

1.) Was doing a web search and found this link:
http://chiangmaifranchise.com/franchise/...o-milk-en/ (not spam). Other than it being cheaper to just do it in Thailand in Thai, what other red flags do you possibly see here?

2.) Have any of you ever owned a hostel? Invested in one? Or nearly started one and then pulled away at the last minute?

3.) If investing in Cambodia today, would you suggest buying a condo, or putting money into a small business?

I don't have the capital for any of this at the moment, but one can dream.

[IntermediateBanger]

I was in Chiang mai for Songkran this year and loved it. I'm curious about going there as an english teacher then looking into starting a business on the side. Lunch at the market there is 40 baht, it's incredible . 1 hour massage 200 baht, amazing.

[seaofp]

(05-15-2018 03:50 PM)Mr.GoodThread Wrote:  

1.) Was doing a web search and found this link:
http://chiangmaifranchise.com/franchise/...o-milk-en/ (not spam). Other than it being cheaper to just do it in Thailand in Thai, what other red flags do you possibly see here?

2.) Have any of you ever owned a hostel? Invested in one? Or nearly started one and then pulled away at the last minute?

3.) If investing in Cambodia today, would you suggest buying a condo, or putting money into a small business?

I don't have the capital for any of this at the moment, but one can dream.

I wouldn't invest any money in thailand whether a franchise, hostel or anything else......too much can go wrong.

It's a great country if you just go about your daily life.....just don't get too involved with thai's.

[Ice Man]

Franchises usually require hefty upfront capital, generally have slim profit margins, and strict rules in the best of scenarios, which some janky Thai company is far from the best scenario.

You have no money anyway, so just pretend you already lost it in a bad Thai business deal.

Oh and your forum name has been reported.

[AsiaBaller]

Why would you invest or run a business in a place where you're a despised unwanted foreigner and everything is stacked against you?

The legal system is a joke and any well connected local can get rulings in their favor.

The only foreign companies doing well in SEA are large Japanese multinationals like Toyota.

Real estate is waaaay overpriced for shit tier third world building standards.

Making money from the western world and spending it in SEA while keeping one foot out of the door is the only time tested method.

Foreigners are barely tolerated in most of SEA as long term residents and you're always a visa rule change away from being kicked out for good.

[Suits]

Thanks for saving me the trouble of typing out a longer post, AsiaBaller.

[Mr.GoodThread]

Thank you AsiaBaller and others.

IceMan, in the first link that I posted it suggested that 2 million Bhat would be the investment. I don't have that much right now, but currency exchange shows me that that's not really that much if we're talking about investments. Also, why would you report me?

"It's a great country if you just go about your daily life.....just don't get too involved with thai's."
SeaofP, you joking, right?

[Fortis]

I think SeaofP is speaking about involved in Thai business. I'm not surprised. It's the same in China. If you just hang out, work and keep your head down, it's great. However, if Chinese friends start pitching you businesses, I'd be VERY skeptical since you can always assume they're taking the lion's share in whatever arrangement you come to.

[Suits]

(05-16-2018 06:47 PM)Mr.GoodThread Wrote:  

IceMan, in the first link that I posted it suggested that 2 million Bhat would be the investment. I don't have that much right now, but currency exchange shows me that that's not really that much if we're talking about investments.

Looks like I'd better just drop a more detailed post, given that when it comes to business in Asia, people are strongly inclined to keep asking questions until they get the answers they want to hear.

If you've only been a long-term resident of Western countries your entire life, it's hard to comprehend how fucked up most of the world is. You'll come to Asia and meet people and they smile and compliment you in more ways that you can count and then you'll become friends.

Except that if you're in Asia long enough, you'll notice that people don't give a fuck about friends or strangers and only care about their family being more successful than other families.

You'll come to Asia and you'll think back to this post and say, "Suits is too negative! All these people are so nice. Suits just doesn't understand the culture like I do!"

If "investing in Asia" interests you, then being broke is the best possible situation you can be in for the following reasons:

• Ever heard a story about someone who did business with a psychopath and got screwed? In Asia, everyone is a psychopath when it comes to driving in traffic and operating businesses.
• The moment they begin to believe that they can achieve more going forward without you than with you, they'll find a way to screw you out of your share of the business.
• You'll assume that this will be impossible because you legally own a percentage of the business on paper and if you believe this, you'd be wrong.
• If you have a legal situation and it goes to court, the decision will not be based on what is fair, but rather, what will offer the local country the greatest long term benefit.
• There's nothing to stop your local partner from starting a parallel business in his own name and funnelling sales through that business while letting the portion of the business that you are a partner in just die off.
• There's nothing stopping a well-connected local business partner from having you deported and permanently banned from the country where you have a share in a company you helped build.
• All the accounting and paperwork will be in a language you don't understand, so good luck with that.
• You can't hold a majority share in a business in Thailand. You can in China, but let's just say that you'd better have a million in the bank if you want to go down that road. It's not impossible to achieve, but you'll need incredibly deep pockets just to deal with all the corrupt government officials you will want their piece and that's not including all the normal challenges of achieving a profit.
• Every region in Asia (except maybe Thailand, which is ironically probably the most ambitious about not allowing foreigners to do any thing that looks like work) have a firmly held belief that their country would be a paradise of achievement and wealth if evil foreigners hadn't invaded and abused them at some point in history. They therefore see it is perfectly justifiable to screw you over.
• People in Asia do not conduct business from the perspective of "you scratch my back, I'll scratch yours." Their goal is to shift the balance of power in any relationship to where they hold all the cards and the other party has absolutely no power. The reason they are being so friendly with you is to soften you up to make it easier to get what they want.
• I have more than enough examples to support everything I'm writing here, but I don't want to spend two hours typing them up and I doubt anyone will want to spend thirty minutes reading that. If anyone who isn't broke is seriously thinking about investing in Asia or starting a business here, please feel free to get in touch visa PM if you need some more in depth feedback.
  

[Shoubuliao]

Aren't you starting a business in Asia, Suits? Granted it doesn't sound like a capital intensive business where you'll have a local partner, but still, aren't you going to have to deal with a lot of the shit you highlighted above? Why not just leave SEA to start your business instead?

Im not trying to ruffle feathers, I lived in China for 4 years and agree with what you said about the continent in general. Moving back to the US has made my professional life way easier, no question. I just wonder why you want to stay given your post.

[Suits]

(05-16-2018 08:57 PM)Shoubuliao Wrote:  

Aren't you starting a business in Asia, Suits?

Nope. I'm in the process of creating products and services that can be sold by a company I'll legally register outside of Asia.

If I do at any point register a company in Asia, it'll be for the sole purpose of processing payments (in local currency) and would not own any assets.

This business strategy is largely due to the points I've outlined above.

[Fortis]

I am pretty sure Suits' business is not your typical brick and mortar deal where he absolutely must have locals helping him run some aspect of the business. Suits has privately given me some insight into what he does, but I'll only go more into that if he decides to share more.


The thing that Suits and SeaofP are getting at is that to do business in many places in Asia, you absolutely must have a chinese partner or X number of local Asians employed by your business. This leads to inevitable entanglement with the locals and certain unsavory customs.

One common thing that occurs in situations like these is that locals will eagerly work for you to datamine your skillset and then hop off and start their own competing business where they steal your customers using your phone list. The sad thing is that their competing business will probably collapse because the ex-employee learned the bare-minimum before hopping off instead of really mastering the skillset. The problem is that if enough of your employees pull this, they can put such a dent in your bottomline so as to make you less competitive over a period of time.

You can skirt a lot of this bullshit if you run an under-the-table teaching or education consulting business that mostly operates on referrals and word of mouth. However, building your clientele list takes a long time and kids are always sick and always skipping classes because China has probably 3 months worth of calender holidays.

That said, if you really wanna make a go of it at a traditional business in Asia, you need to have rock solid connections and a skillset that is not easily stolen or mimicked.

I've been in China for only three years, but I've met many people in "business" and as I've gotten to know them more and more, I always find out that they're always doing something illegal to remain competitive. If you talk to these people about doing things above board, they laugh in your face. Literally. If you're in Shenzhen, I could probably name a few foreigner businesses that you know that are rotten to the core with illegal banking practices. It would probably blow your mind.

I have one, only one, foreign friend here who is doing a 100% legitimate business. He does something in the medical industry. I won't go too much into what he does, but he tells me that having the businiess under his name with Asian partners is such a hassle because you are treated with xenophobia whenever it comes time to deal with paperwork and regulatory practices. The other thing about running a legal, above board operation in China is that the banks you use can arbitrarily shift regulations and create a situation where your cash flow is almost fatally interrupted. This can spell death for any sort of import-export business right then and there.

I know you're probably thinking "i can just get an HK bank account, right?" Nope. Over the past few years, the mainland has put the squeeze on HK bank accounts since locals were using them to filch money off into properties in places like USA, AUS, NZ and Europe. Now you go through hell just proving that you're not a money launder, and if the bank sees too many Rambos (RMBs) moving around to different countries, they might put a freeze on your account (and send you notification via snail mail ) until you verify that you're legitimate.

This happened to my above board friend and he had to fly to a few continents to finally find a bank that wasn't so shifty.

He could put the business under his Asian partner's name, but then he opens himself up to having the business swept out from under him if the partner decides he doesn't need my friend anymore. I'm sure there are foreigners doing everything 100% legally in China, but those dudes almost always have world-class proprietary skillsets and connections (Rich Wife's daddy) who the Chinese can't afford to fuck over.

I don't say this to discourage OP, but there is a reason you almost never meet non-Asians back home doing big business in burgeoning Asian economies. I know some dudes will probably come in here and say otherwise, but if some locals you hardly know are asking you to throw down millions in local currency to invest in some real estate scheme, you would be silly to not question it from every angle and then some.

[Suits]

(05-16-2018 09:38 PM)Fortis Wrote:  

Suits has privately given me some insight into what he does, but I'll only go more into that if he decides to share more.

I actually haven't settled on a long-term strategy. I'm still trying to learn more about which products and services are in demand and then form a strategy to offer them while being smart about protecting myself and my work.

Currently, I only take cash payments for under the table work. I haven't taken a traceable payment for anything in over two years now.

Obviously, this is only doable as a small time player servicing other small time players. Larger companies are going to want receipts.

You're welcome to comment, Fortis, on some aspects of the direction I'm moving in, but obviously don't go into specifics that could threaten my privacy.

(05-16-2018 09:38 PM)Fortis Wrote:  

I am pretty sure Suits' business is not your typical brick and mortar deal where he absolutely must have locals helping him run some aspect of the business.

I clued in a long time ago that it is basically inconceivable to run a business as one dude with a foreign passport in China. Just to register a WFOE in China requires two key corporate positions to be held by two different people, so having a partner/long term employee of some kind would be mandatory.

When it comes to a brick and mortar business, there are so many areas that are going to be an expensive pain in the ass, that I would only seriously consider opening that type of business if I had investors handing me up words of a million USD in starting capital.

Between requirement for a certain amount of local employees, fire code regulations, and various government agencies lining up for their piece of the pie, it's simply not the sort of thing one guy is going to want to put his own money on the line for.

Restaurants are about the worst type of business to open, because there are so many extra regulations to attend to and it's not really easy to fly under the radar as a business that depends on heavy public marketing to bring new customers in.

Retail is just about as bad. Manufacturing is something foreigners can't currently own more than 49% in.

(05-16-2018 09:38 PM)Fortis Wrote:  

That said, if you really wanna make a go of it at a traditional business in Asia, you need to have rock solid connections and a skillset that is not easily stolen or mimicked.

The best way to do business in China (and arguably anywhere else in Asia including SEA) is to own and manufacture a product that would be virtually impossible to copy and then have other companies sell it on your behalf in the individual countries.

This is probably easiest if you create a custom product for each buying and if doing so requires a skillset that only you possess.

If you're a big corporation with deep pockets to pay lawyers, you can protect yourself with patents and trademarks, but good luck with taking on companies 100X your size if you're a small time player. It only counts if you win in court.

(05-16-2018 09:38 PM)Fortis Wrote:  

One common thing that occurs in situations like these is that locals will eagerly work for you to datamine your skillset and then hop off and start their own competing business where they steal your customers using your phone list. The sad thing is that their competing business will probably collapse because the ex-employee learned the bare-minimum before hopping off instead of really mastering the skillset. The problem is that if enough of your employees pull this, they can put such a dent in your bottomline so as to make you less competitive over a period of time.

Virtually every Chinese (and I have to assume Asian) person you meet will be of the opinion that your only advantages are being white/having a foreign passport/being a foreigner and therefore automatically rich.

If you work as an employee at any company in Asia, your coworkers are going to largely assume that the only reason why you have the level of responsibility you do is because of your foreign status and that they are smarter than you and can do everything better than you.

It's very similar to women arguing that they can do everything a man can do, but better and in heels.

A common example for those who teach, is dealing with this attitude from the Chinese teaching staff at their school who have an English language level so low that they say "open the lights" rather than "turn on the lights" but are still convinced that they could do a better job teaching the English language than any Westerner and are pissed that someone who leaves their home in a first world nation earns more money that they do for doing what they believe is an identical job.


So, copying businesses is a pretty common activity for Chinese employees. Sure, failure is pretty common, but until that happens, they are completely convinced that they are absolute geniuses.

[Shoubuliao]

I get that you're registering your business in another country and not investing any meaningful amount of money in Asia, but why do you want to do business there in the first place? It sounds like you don't like dealing with Asians period. Even if your clients are mainly expats living in the region, you still have to deal with the backward ass BS of the countries you're operating in. And cash payments and under the table work is not scalable, as you've alluded to. So...why Asia?

[Suits]

(05-16-2018 11:02 PM)Shoubuliao Wrote:  

I get that you're registering your business in another country and not investing any meaningful amount of money in Asia, but why do you want to do business there in the first place? It sounds like you don't like dealing with Asians period. Even if your clients are mainly expats living in the region, you still have to deal with the backward ass BS of the countries you're operating in. And cash payments and under the table work is not scalable, as you've alluded to. So...why Asia?

Like most things involving earn an income, people tend to go where their skills are needed. My current clients and the clients of the products I'm developing are largely local Asian business people, so Asia is a large target market for me.

I am interested in diversifying to target North America and possible other regions over the next few years, but I haven't explored this as of yet and having lived the better half of my adult life in Asia (mainly China and Japan), my current knowledge and skillsets are specifically well suited for local needs.

I'm not going to intentionally discourage anyone from pursuing Asian economies, as there is money to be earn here.

However, I will actively go out of my way to discourage anyone from thinking (1) that it will be easy to do so here, (2) that running a legal business here without being backed by investors that provide upwards of a million dollars in seed capable makes much sense and (3) that you're really prepared to navigate a local environment as someone who hasn't spent much time here.

As I noted above, I'm more familiar with business opportunities in Asia than I am with business opportunities in North America (or Africa, South America or Australia for that matter), so that actually means that for me, it's easier to pursue opportunities related to the terrain that I am familiar with.

Likewise, if you've spent less than 2 years living somewhere specific and don't speak the local language, you are putting yourself at a disadvantage trying to move to a new country where you are an outsider and trying to build a business.

If part of the motivation is that you don't see any opportunities where you already have experience, then you'd best give up on the idea of trying to put a shingle somewhere else, because the opportunities aren't going to be superior for you there either.

Since becoming an adult, I've spent less than 2 years of my life in the one country where I'm a citizen, so me going there now to look for opportunities would be a step back, even with the added advantage of not being a visible minority.

[Saweeep]

I know plenty of expats here in Thailand that own businesses of various sizes and levels of success.

Would I do it myself (I've considered it multiple times)? If it required no major capital investment in the country itself, like Suits' business, possibly.

Would I invest into an infrastructure based business that couldn't up shop and piss off at a moment's notice? Hell Fucking No.

The wind changes direction out here fast...one day everything's going fine; the next the govt changes policy or the local owned competitor decides he doesn't want you around anymore and bam...you're done. Think the rule of law will save you?

What rule of law??

Life out here is cheap...get into a dispute with anyone in this part of the World and tbh it's probably easier for them to just have you shot than piss about arguing etc.


SEA is for holidays and spending your Western earned money.

Be careful!

[seaofp]

(05-16-2018 06:47 PM)Mr.GoodThread Wrote:  

Thank you AsiaBaller and others.

IceMan, in the first link that I posted it suggested that 2 million Bhat would be the investment. I don't have that much right now, but currency exchange shows me that that's not really that much if we're talking about investments. Also, why would you report me?

"It's a great country if you just go about your daily life.....just don't get too involved with thai's."
SeaofP, you joking, right?

No, not joking......it's a good country and the people are pleasant, just don't get involved with them when it comes to business (or relationships) as lurking below that calm exterior is a greedy & ruthless psycho.

[pargan]

The #1 most important factor of doing business in a country is its rule of law. If a country has fucked up corporate law it is a bad idea doing business there. If you're thinking of doing business in a developing country/country with bad corporate law it's best to stick with something simple like export/import cheap products and even then you have to be careful.

If someone shows you a "business opportunity" to develop some real estate or anything that relies on you trusting them tell them to fuck off. When doing business in these countries you need to control the process 100%.

[Shoubuliao]

@Suits

Fair enough, I see where you're coming from. But one problem I see with a lot of expats in Asia, myself included at the time, is sunk cost fallacy. You feel like since you've learned the language to a solid level, have most of your network there, etc going home would be a huge waste. So you stay. But the lack of rule of law, impossibility of full assimilation, bias against foreigners, etc do not change based on language ability, network, lack of opportunity at home, etc. I was in much the same situation you are when I left. I had to rebuild my life in the US from scratch, and it sucked for a while, but I ultimately got a much better opportunity than I would've gotten in Asia. I'm glad I got out when I did.

I'm not telling you to do what I did, more just a warning for people to be careful about sunk cost fallacy. Asia is a place I love for travel now, but don't want to rely on for an income. But either way, I wish you success and look forward to hearing about how the next few years play out.

[Suits]

(05-17-2018 08:44 AM)Shoubuliao Wrote:  

@Suits

One problem I see with a lot of expats in Asia, myself included at the time, is sunk cost fallacy. You feel like since you've learned the language to a solid level, have most of your network there, etc going home would be a huge waste. So you stay. But the lack of rule of law, impossibility of full assimilation, bias against foreigners, etc do not change based on language ability, network, lack of opportunity at home, etc. I was in much the same situation you are when I left. I had to rebuild my life in the US from scratch, and it sucked for a while, but I ultimately got a much better opportunity than I would've gotten in Asia. I'm glad I got out when I did.

I live in China for the following reasons:

• I like living here.
• At my current stage of career development, China is the perfect platform to continue learning (a lot, fast) and test out new innovations and products.
• My visa situation is currently stable.
• I have income streams in Beijing that I've built over time. That time would only be a sunk cost if I could immediately have the same income streams in place elsewhere, but that reality is that I would have to build it from scratch, which would cost me 6-9 months of lower income.
• I'm currently far more competitive and can earn more money in China than in any other country I know.
  

My long term plan isn't to remain in China. I haven't decided where I'm settle, but no matter where, I am working towards the goal of having a business where money comes from customers in several different countries, so I never have all my eggs in one basket.

By the way, you're confused about what a sunk cost is. The sunk cost fallacy would be choosing to remain in Asia, because of the effort and time/money put into getting to where I am now, even if better opportunities exist elsewhere.

I don't currently have better opportunities elsewhere, so the fallacy is not at play here.

If you've followed my posts recently, you'd be aware that I'm actually planning a break from China next winter to explore non-Chinese specific opportunities (even if it means temporarily not having an income for a few months).

[Mr.GoodThread]

Okay, I guess we got a good thread out of this after all... I appreciate all of your replies and I appreciate the effort in writing all of that up (really do).

Suits, although it'll be more expensive, would you be able to say that Japan is less shifty and underhanded (strictly speaking about business practices) than China and Southeast Asia?

Pargan, nice post to sum things up.

[buja]

Check this out...

https://www.investasian.com

He focuses on Cambodia and says it's the best place for foreigners to invest.

Opportunities in Cambodia

Opportunities in Cambodia 2

[Mr.GoodThread]

@buja
Thanks for the link, but after this thread I will definitely tread lightly, and think and rethink about any sort of actions I take in the near future investment- wise in Asia.

Edit: quick look at the site made it look spammy. Hopefully that's not the case upon further review.

[Suits]

(05-17-2018 01:15 PM)Mr.GoodThread Wrote:  

Okay, I guess we got a good thread out of this after all... I appreciate all of your replies and I appreciate the effort in writing all of that up (really do).

Suits, although it'll be more expensive, would you be able to say that Japan is less shifty and underhanded (strictly speaking about business practices) than China and Southeast Asia?

Pargan, nice post to sum things up.

People are not above underhanded behavior in Japan, but there is definitely a greater sense of rule of law there and equally importantly, honour.

China is not an honour culture. Behaving with honour is viewed as stupidity/weakness. Korea pretends to be an honour society, but isn't.

Japan actually is.

Not that Japan is some paradise. It's far more racist than China (where the people are uniformly nationalist and selfish, but not specifically racist -- they don't care who the have to sit next to on the subway, as long as they get a seat -- many Japanese don't want to be anywhere near a non-Japanese person and view non-Japanese people as subhuman).