Opening a new business in DR

4POSTS

8 years ago

I figure the start up costs would be somewhere in the range of $350,000 - $550,000 USD which I plan to fund myself without the need for financing. The demand is Santo Domingo is definitely there. One short trip to the San Isidro section on Santo Domingo on a weekend evening/night will prove it. There are already a fair amount of Cabanas there but they lack quality i.e. (good towels, soap, condoms, beds, food, and drinks). I can price my Cabanas in-line with the other cabanas but have a superior product/experience rooms. Ultimately I anticipate that this will lead to me 1)taking market share from the existing cabanas or 2)attracting people who otherwise would not go to these "lower quality" motels. The beauty of it is that I am still relatively young and have my full-time job that can/will keep me afloat until the business gains traction.

Are there any other pitfalls i should consider? What is the tax rate on earned income for expats or dual-citizens? What can I reference for labor laws?

planner Dominican Republic Expert

17771POSTS

8 years ago

#322

Labor.laws are very strict and probably the only laws that are upheld.

Your costs are in the.low end if you intend to offer higher quality. And i am not convinced that "if you build it they will come". They are successful on certain levels because they are good enough to serve their purpose.

Clean, air conditioning, good showers, tv etc are the standard. Some are much much nicer than others of course. And they are everywhere!!! They are moderately priced and often convenient.

Is there room for higher end model? Maybe. Is their market? Maybe.

You seem to be starting the process of finding out. My sense: the market is saturated. Make sure what you want to do will work. You have lots to investigate.

Tomas Cabrera Serial expat

606POSTS

8 years ago

#323

Planner is correct in all she is telling you.
Especially in the "build it & they will come" area.
For a cabana to do well you need lots of connections,
(sales people) in bars & night clubs.
Be careful in this area you are treading on dangerous ground chum.
Tom.

1 member reacted to this post

morganfeliz18 New member

4POSTS

8 years ago

#324

Maybe I am missing something but it seems like a very straightforward business to me. 1) I build a superior motel 2) Create buzz via social media and nightlife venues 3) people use the motel because its unlike anything in the market. What am I missing? Keep in mind that Finance and numbers are my area of expertise. I have the capital for construction and maintenance so again what am I missing? This is also not the only business and income stream I will be dependant on.

planner Dominican Republic Expert

17771POSTS

8 years ago

#325

Nothing here is straightforward, nothing. Social media is a force but doesnt always work the way you think.

Here its about convenience, price, location and so often the fact its owned by my cousins neighbors brother in law and therefor almost my family...... gets the business.

Remember why cabañas are built! More often then not they go where its convenient and cheap!!!

planner Dominican Republic Expert

17771POSTS

8 years ago

#326

FYI no doubt about crunching numbers!! Its all about the culture of the business and the culture you will operate in.

Tomas Cabrera Serial expat

606POSTS

8 years ago

#327

Hi Planner!
Is it me, or does Happy Morgan think these "Cabanas"
are a legitimate business here?
You & I know exactly what they are. Should we tell him?
Tom.

morganfeliz18 New member

4POSTS

8 years ago

#328

Tomas,

You keep making vague comments that are not adding any value to this dialogue. When you say "legitimate businesses" what exactly do you mean? A legitimate business in my eyes is a business that is 1) legal and 2) profitable. Are you implying that this type of business is illegal and can not be profitable?

I welcome constructive feedback but making vague comments is a waste of eveyone's time. Thank you in advance.

1 member reacted to this post

Tomas Cabrera Serial expat

606POSTS

8 years ago

#329

Hola Happy!
Thanks for you "get to the point" comment.
Are you aware most of these establishments are rented by the hour?
Tom.

1 member reacted to this post

planner Dominican Republic Expert

17771POSTS

8 years ago

#330

I think he does know and they absolutely are a legitimate business Tomas. Some do make money, sadly many dont.

Rynehoeyllc New member

5POSTS

8 years ago

#331

Can anyone share some thoughts on nail/beauty salon in the Dominican.
I was thinking Santiago?
Please all feedback or thoughts are wanted and appreciated!
Thanks in advance!

planner Dominican Republic Expert

17771POSTS

8 years ago

#332

Welcome to the forums. Nail salons are everywhere!!!! They are reasonably low start up cost, labor intensive and profit margins are not great. Competition is fierce.

It costs 2 bucks to get nails polished. 5 to get acrylic nails filled and maybe 10 to get new nails!!!!

You need a lot of customers to make Ny real money!

1 member reacted to this post

Rynehoeyllc New member

5POSTS

8 years ago

#333

My thoughts as well. Love profit margins and need high volume which can be hard with all the competition .

Where is your office located?

abreuimmigration Contributor

181POSTS

8 years ago

#334

I agree with Planner. It is not easy to support oneself with that type of business.

Perhaps if you provided high quality nail products and/or services that at hard to find in the Santiago area. You may be able to charge near NY prices for these high quality services in high-end neighborhoods like Los Jardines Metropolitanos, Villa Olga, Cerros de Gurabo and Las Trinitarias.

But, the rents in these areas would also be higher than other parts of the city. I recently opened another office in Los Jardines Metropolitanos which is a very nice area.

Advertising your services in these areas will also help attract more clients.

planner Dominican Republic Expert

17771POSTS

8 years ago

#335

Sorry I know of absolutely no one in this country willing to pay New York prices for any kind of nail service or product!!!!

1 member reacted to this post

abreuimmigration Contributor

181POSTS

8 years ago

#336

The mayor cities (Santo Domingo and Santiago) in the Dominican Republic have higher income individuals that would be willing to pay higher prices for a product or service that is of high quality. These prices already exist in select neighborhoods.

planner Dominican Republic Expert

17771POSTS

8 years ago

#337

Higher prices NOT New York prices! Does not happen.

Tomas Cabrera Serial expat

606POSTS

8 years ago

#338

Definitely have to agree with you there Planner.
Tom.

1 member reacted to this post

Jayyanamria17 New member

5POSTS

8 years ago

#339

I have a few different business ideas I was looking for assistance with.
1) selling organic, holistic soaps and lotions at hotels and resorts, although I noticed someone is already doing that on my last trip to Juan Dolio.
2) Purchasing homemade Dominican goods and selling them abroad online.
3) Opening a sports performance improvement firm. I know baseball is king in the DR and I have been training in a performance improvement program based in neurology.

Any advice is greatly appreciated.

planner Dominican Republic Expert

17771POSTS

8 years ago

#340

Welcome to the forums. Here is my 2 cents

1. Its being done

2. The cost of shipping out of here is the issue! Its too expensive

3. That is covered in baseball with all the professional mlb team training camps.

Not sure any will work well!

Jayyanamria17 New member

5POSTS

8 years ago

#341

Thanks for the response. I appreciate it!

1 member reacted to this post

El extranjero1959 Member

12POSTS

8 years ago

#342

I have to agree with planner on the shipping part. I have tried and shipping anything out is so so expenses.

El extranjero1959 Member

12POSTS

8 years ago

#343

That's right no one unless American but even then looking for bargain. In the states we at less triple mark ups here in D R you lucky if u can double . Example I made custom jewlery in Florida and sold for $5 those same one will not even sell for 100 peso so imagine that's 150 less then what I am use to it . So I had to trash that business. This is to give example to you all to help. Hope it was helpful.

2 members reacted to this post

El extranjero1959 Member

12POSTS

8 years ago

#344

I have to agree with planner on slot of things. Cabañas are all over the place n very low profit with the natives but maybe you would have a better luck with advertising and focusing on vacationing people from out of island. Let me tell you living in D R is so different. I am married to a Dominican women and I have thought of many businesses to start but no real profit. Very hard. I also am a photographer can't even make it as that no one wants to pay. Natives want things for free most of the time. So hard . I hope it was helpful to you. And remember it is always up to you whatever you decide to do.

Jayyanamria17 New member

5POSTS

8 years ago

#345

Thanks It was helpful. I am engaged to a Dominican woman and I have a successful business here in the states, but I would like to have something going there as well. Maybe buy a home and have dual citizenship. I've also thought of a business providing generators. I know the power infrastructure is an issue.

planner Dominican Republic Expert

17771POSTS

8 years ago

#346

There are lots of those companies already. If you have a better "mousetrap" then it can work.

El extranjero1959 Member

12POSTS

8 years ago

#347

That's a great business but it has its pros and cons at the same time let me tell you in some of the city's bigger cities they're getting 24/7 electricity now in the rural area they can't afford it so please do some homework some research before you do big Investments. I shouldn't be telling you this you're a businessman as well as I am and you understand that we can't go into you know head first into things we have to walk in and put our feet in first. I as well he's trying to buy a home but I have to buy it in the ruaral area cuz they are less expensive. But you can find good catch in the cities to. Plus house that they started and ran out of funds or died you can pick up one like that.

planner Dominican Republic Expert

17771POSTS

8 years ago

#348

Always good to do your homework.

Some good info here however the big cities have massive areas (barrios) with lotsnof electrical outages. The areas that do not tend to be areas of middle and upper class who either pay their bills OR have political influence.

My guess is 75% of this country still has outages on a regular basis.

2 members reacted to this post

Jayyanamria17 New member

5POSTS

8 years ago

#349

Thanks. I'd rather be in a rural area sometimes. But I also like Juan Dolio. Just enough tourism to have potential for the right business and small enough to enjoy the beach without being overwhelmed.

Jayyanamria17 New member

5POSTS

8 years ago

#350

Agreed Planner. My fiancee has outages at least once a month in Santo Domingo Este. The question is how to make it affordable enough for that population.

Rynehoeyllc New member

5POSTS

8 years ago

#351

What's about customer apparel in the free zones? I have contacts to produce customer sports apparel direct to the cusstomers. Also I have a friend who has been in the same business and could share some talented operators.
Any feed back in appreciated.

planner Dominican Republic Expert

17771POSTS

8 years ago

#352

Depending on margins, yes it can work. There is a move to take manufacturing back to the USA. But if course no one wants to pay higher prices. Production here is closer, not the highly publicized china sweatshop, and still cheaper then USA produced items.

1 member reacted to this post

Rynehoeyllc New member

5POSTS

8 years ago

#353

Profit margins will be at 30-40 percent,
Possibly as low as 20 depending on volume.
I am looking for one more solid company.
I'mot wanting to buy the fabric but have it supplied to me

sunshine28 New member

6POSTS

8 years ago

#354

I've stayed long term in the DR on and off for the past 3.5 years and explored the country all over (literally), and finally getting the courage to start a business. I'm thinking of offering day tours that would include lesser-known cultural and outdoor places based on my intimate knowledge of the DR. Does that sound like something that would be popular, and how can I find out/measure the market?
Also wondering whether it's best to be based in Bavaro because the amount of tourists who naturally flow there vs. Santo Domingo (plus most tour ops in PC offer the same stuff).
A lawyer told me you can incorporate a business without being resident. Could I operate by collaborating with a licensed tourism driver?
Curious to hear thoughts from those of you who are experienced business owners! Or anyone doing tours. Cheers!

Bob K VIP Member

7675POSTS

8 years ago

#355

Sounds a lot like what "puntacana Mike" is already doing in the area.
Not sure of all the legal hoops you need to jump through. It may not be easy with out your residency as I assume you need to register you company with the tourism board. You better get a good lawyer to help you set this up if you go ahead with the idea

Bob K

1 member reacted to this post

planner Dominican Republic Expert

17771POSTS

8 years ago

#356

You can incorporate without residencia but cant work in the business without it. To offer "tours or excursions" you need li ending insurance etc etc. And i believe to be a licensed guide you must be Dominican!

It is not a simple process. Happy to meet with you here in SD and share my knowledge!

1 member reacted to this post

sunshine28 New member

6POSTS

8 years ago

#357

Thank you both for your advice!

@planner - I'd love to meet and chat, thanks for offering! Will inbox you - soon as I figure out how to use the inbox thingy.

1 member reacted to this post

mdk004 Member

3POSTS

8 years ago

#358

Hello,

I want to open up a consignment store in Dominican Republic. I am from Dominican decent, I do not live there, however I would love to open up a store and I would like some advise on where in Dominican Republic, and the steps I may need to take. Also, I am thinking of exporting from Florida.

Any Help and Advise will be appreciated.

Maria

Bob K VIP Member

7675POSTS

8 years ago

#359

Maria welcome to the forum. Have you been here and explored extensively? Have you located where there is a need for your type of store? IN our are there are two. One with three shops is aimed at the Expat population and somewhat the local Dominicans and the other basically for the locals as well as a couple of Pulgas (flea markets with clothes and shoes).
Do you have you residency, which you will need to operate here legally? Are you planning on incorporating? Have you studied the tax laws and any permits if necessary?
There is a lot of home\work to do and you should start by visiting and decide if there is a need for your plan.

Bob K

mdk004 Member

3POSTS

8 years ago

#360

Bob,

Thank you for your insight. I am actually planning a trip soon, in the next couple of months. I know for a fact that people constantly send used clothing to sell in Dominican Republic. Which is why I am hesitant to whom I give my children's clothing away, because I prefer for someone in need to receive them and not to be sold. I do now have my residency and I will have to begin to work on that. I also have plenty of family in Santo Domingo that can probably assist with some things.

I will do my research in regards to the tax laws, permits and etc. Is operating in a Pulga equal to operating a normal business?
Also, do you have any recommendations on where I can educate myself with the information.

Thank You