Owning your own business in Mexico

[jamaicamenutts]

Hey Everyone,

I think there are some people on this forum who own their own businesses down there in Mexico. I have always wanted to own my own business...not really sure why I didnt become a business major, but anyways....I love Mexico and the Playa Del Carmen/Rivera Maya/ Puerto Aventuras area. My hubby and I were talking about how cool it would be to open a boutique hotel or a restaurant or something small down in one of our favorite vacation destinations. So...what I am looking for is someone who knows something about opening a business in a foreign, specifically Mexico, and who can give me some advice and some direction on doing so. Is there anyone who can give me honest advice?? Maybe direct me to some websites or something.

Thanks so much!!

[Tony&Cheri]

Originally Posted by jamaicamenutts

Hey Everyone,

I think there are some people on this forum who own their own businesses down there in Mexico. I have always wanted to own my own business...not really sure why I didnt become a business major, but anyways....I love Mexico and the Playa Del Carmen/Rivera Maya/ Puerto Aventuras area. My hubby and I were talking about how cool it would be to open a boutique hotel or a restaurant or something small down in one of our favorite vacation destinations. So...what I am looking for is someone who knows something about opening a business in a foreign, specifically Mexico, and who can give me some advice and some direction on doing so. Is there anyone who can give me honest advice?? Maybe direct me to some websites or something.

Thanks so much!!

Well, we moved to Mexico and opened a small boutique hotel, and as one person on this forum recently said to us, "you were blessed to move away to an eternal vacation." When we read that we rolled around on the floor laughing hysterically.

In all seriousness, your question is far too complex to simply find answers on any websites. All of the difficulties and problems that exist with any business, particularly one in the service industry like a hotel or restaurant, apply here 100 fold, and are combined with all of the frustrations and limitations that exist in a third world country. Just getting permission to stay in Mexico to run your business is a complex and difficult issue.

The best we can suggest is that you begin a long process of research. What are your interests, what is your background, what is your ability. Once you determine the type of business you're interested in, it's time to start researching both the availability of that business in Mexico and the legal requirements of owning and running such a business.

There are many books on the market about retiring to Mexico. We read them all and utilized hardly any of them. We really found no good books on the subject of ownership of a business in Mexico. We would suggest your best source of information will be forums like this one and more specifically the blogs of people who have moved here, live here and work here. Michele's and PlayadelSoul's blogs are good places to start. You can also take a look at ours. John & Libby and Mike & Sharon also have good blogs, and we know there are many others just in this area.

We also strongly suggest that you spend as much time down here as possible. Not just a week's vacation but an extended stay when you can meet and talk not only with locals but with professionals like attorneys and accountants.

Of course, being fluent in Spanish would be tremendous help. Unfortunately here were are having moved to Playa three years ago and we've only just now completed our first Spanish course. This is a do-as-we-say not do-as-we-do piece of advice. It would have made a big difference to us.

In the end, our best advice is this: realize now that you will work harder here than you ever would at the same occupation or business if you owned it in the States. You'll be working when everyone else is in the bars and at the beach. On the plus side, life in another culture and country is an experience that we would not trade for anything. It gives you a totally new view of the world and of yourselves.

And every once in awhile, not often but sometimes, you get to walk down to the beach and wade into that beautiful blue Caribbean Sea and say to yourself, "This is why I moved here."

[Solomon]

I would have to say that owning my own business in Playa Del Carmen has been one of the most rewarding and challenging things I have done in my life, but it definitely takes a lot of adjustment from the mindset a lot of people have in the States.

Two years ago I started doing building administration for a couple of condominium buildings here, the process for getting the company legal and running properly was long and tedious. My business partner and I used an accountant to get all of our papers in order, because neither of us really knew where to start.

In the last couple of months, I have been working on opening a consignment store in Playa Del Carmen and I have been trying to do all the setup work myself. This has been exhausting and at times really frustrating, but I am really happy I did it myself this time, because I have a better idea of system now. My spanish is pretty good and I have had ample chance to get adjusted to the way things work here, I wouldn't advise doing things yourself for the first time. There are many good accountants and attorneys that specialize in helping foreigners open a business, if you need a reference I would be happy to give you one.

Some businesses here do incredibly well, many fail within the first 6 months. I guess that is probably true anywhere. As was mentioned before, I work when other people are at the bar or at the beach or sleeping. Also as mentioned, the benefits are that I wake up every morning with the Caribbean a block away.

[jamaicamenutts]

This is great information. I think my hubby and I were thinking about a small hotel more than a restaurant or store. But like I said it would depending what would work out to be a better business in the area.

How do you afford to open your business? Did you take loans out? Did you have a savings of any sort? Can I ask how much you spent on the original purchase without "updates" or remodels? Did you buy it when it needed a lot of work or was it already established?

I have heard that Americans cant own property in Mexico...is this true? If so how do you work around this??

I will read those blogs you suggested. Thanks again!

[Solomon]

I have a business partner. He put up the money I do the heavy lifting. That is how I afforded to do it, our overhead was pretty low as well.

Americans can own property in Mexico through a land-trust or a corporation. It is more-or-less necessary for a foreigner to do business in Mexico to open a corporation, so your corporation would hold any of the assets. It cost about $3000US to set up my corporation a couple of years ago, I have heard of it costing other people more and others less.

[jamnkats]

Hey Solomon! I see you import! I just emailed you about some stuff I want brought down.

[Tony&Cheri]

Originally Posted by jamaicamenutts

This is great information. I think my hubby and I were thinking about a small hotel more than a restaurant or store. But like I said it would depending what would work out to be a better business in the area.

How do you afford to open your business? Did you take loans out? Did you have a savings of any sort? Can I ask how much you spent on the original purchase without "updates" or remodels? Did you buy it when it needed a lot of work or was it already established?

I have heard that Americans cant own property in Mexico...is this true? If so how do you work around this??

I will read those blogs you suggested. Thanks again!

We appreciate your curiousity but the truth is we prefer not to discuss personal financial issues onine. In addition our costs both of purchase and improvements are already irrelevant and outdated by the rapid appreciation of Playa property in the last few years. However we will offer some thoughts:

You can own commercial property in your own name even as a foriegner in Mexico. Residential property requires a bank trust or Fideicomiso.

Commercial loans are rare in our experience. Mortgages or loans or carry back moneys are unsuual but may exist depending on the seller. Most of the time it is cash in full at time of purchase. And there is a substantial transfer tax on real property which often affects the purchase price.

We bought out business as a "fixer-upper" and did the renovations ourselves. However there are businesses in Playa which can be bought as "turn-key" operations requiring no further investment or improvements...but these tend to demand top dollar.

The most important question is not how others afforded the move...but how will you? Again before selling the house, quiting the job and cashing in the IRA's we strongly suggest some extended time staying here, and scratching beneath the surface of the local business scene in person.

[jamaicamenutts]

Thanks for the info. Well...I am only 25 years old. I have no house, all I have is student loans. LOL.

[Tony&Cheri]

Then maybe you should consider a lottery ticket.

[jamaicamenutts]

lol...maybe some day.

[marissab]

My business partner always told me that if you can make a business a success in Mexico you can make a business a GIGANTIC success in any other country.

Doing business and being profitable here is very very hard. A lot harder than in the States....

[Michele]

Originally Posted by marissab

My business partner always told me that if you can make a business a success in Mexico you can make a business a GIGANTIC success in any other country.

Doing business and being profitable here is very very hard. A lot harder than in the States....

While I would agree with that almost 100% I should add in one caveat:

If you come here and apply the same work ethic and standards to yourself and your business that you would have in your home country then you WILL have a leg up on much of your competition. People often ask us what we do differently that has made us a success story rather than one of the dozens of real estate offices that closed their doors this year. The answer is simply WORK. We get up everyday and do the job. No matter what is going on, whether we have customers in town or not, there is work to be done every single day. Low season does not mean we go on vacation or lay people off. Low season is when we work the hardest getting prepared for high season, hring and training new people and making the necessary expenditures that will insure that we are absolutely ready for the winter/spring rush of buyers.

Do we get to the beach every week? Yes.
Do we make time to travel and explore the region and beyond? Yes.

Remember, most folks don't come here to reach the pinnacle of success in their chosen field. They come for the beach, the laid back lifestyle and to have fun. If you can balance all of those great things with your existing work schedule, strategies and effort you will come out ahead.

Just my 2 pesos.

[marissab]

Hi. I do agree Michele. We did well thanks to my partner's long days! He worked so hard. Treated our employees well! And was always looking forward.

( I was in the States at the time...)


If someone thinks they will come here and NOT work they are crazy. And setting themselves us to fail. Here, I believe, you have to work harder! And Smarter!

[Michele]

Originally Posted by marissab

Hi. I do agree Michele. We did well thanks to my partner's long days! He worked so hard. Treated our employees well! And was always looking forward.

( I was in the States at the time...)


If someone thinks they will come here and NOT work they are crazy. And setting themselves us to fail. Here, I believe, you have to work harder! And Smarter!

Exactly!!