Buying/Owning Bar

[gulls123]

All,

This is a general question for all of the expat bar owners out there. I am wondering how they went about owning a bar/club in Thailand. What were the costs? Did you go in as a partner (and if so where did you find a partner)? What are the legalities? How difficult is the process?

 

I am very interested in getting involved in this business so any advice would be greatly appreciated.

 

thanks

--greg--

[Ducar]

I can see so many really great business and investment opportunity's in Thailand.

 

Being a bar owner or restaurateur would probably be the third worst investment a foreigner could make.

Becoming a partner in a bar would be just plain foolish.

 

How to make a small fortune in Thailand. Start with a large one and buy a Bar.

 

There is a great island just off shore for sale. viewing by appointment. DURING LOW TIDE.

How about this great plot of building land. Only available for viewing DURING THE DRY SEASON.

 

No wait here's a better one. Get rich selling bars and restaurants to wide eyed foreigners. Then get em back for free when the new owner can't make the balloon payment. Usually all remodeled. Then sell it again. This one is actually viable and being done.

[snobbypit]

Listen to Ducar. It is WISE ADVICE...

[hedonist]

You wont get any decent answers to your question on a mongers board, no matter how well meaning people think they are being.

You won't, for instance get a post that reads:

"Hi, i'm <insert name here> and i own <insert name of, and type of business(es?) here> and all my businesses shit money 24/7. So much so that i cant spend it fast enough. I have a fabulous lifestyle, and heres how i do it................"

They will then go on to give chapter and verse of how easy it is to do, by following their instructions.

You know why you wont see a post like that? Well, firstly, it just dont happen that many farangs make good coin in Thailand. The laws that are set out dont allow it.

Secondly, detailing the "Secrets of my success" would be like shitting in your OWN rice bowl, by allowing all and sundry to help themselves to the contents.

No, the BEST person to ask questions to is none other than yourself, starting with but a simple one.........why?

"Why do i want to own a bar in another country?"

I will hazzard a guess, here and say that, like most people who have, are, or will contemplate owning a bar do so for ego purposes Those 6 little words that they will utter to their old friends and family ...... "i own a bar in Thailand"

Most people who get the "Pattaya fever" (an i inlude myself in there somewhere too, btw)think about owning some bar, or even another tourist related income stream. But most, quite quickly, come to the conclusion that its just not worth the hassle and heartache/stress.

Ask yourself if your life is that crap in your home country that you contemplate leaving your network of friends and your family to set out on your own thousands(?) of kilos away from them. Yes, you might well say "but i can make new friends there, once i get the bar up and running" Let me tell you this...there will be many AQUAINTANCES along the way, but your true friends will be a long way away. You will meet 2 types of people, as you set out in your one man kayak heading for the promised land. Those sharks swimming in the waters around you, waiting for you to roll over, and those shitehawks circling above, waiting to pick whats left of your carcase once the sharks have had their fill. Dramatic? yes Without substance? nope. I think of all the people i have known in over 25 years of going to Thailand, and NONE of them made Jack Shit out of anything worth talking about. Bar related or not. All went home potless with their tails between their legs.

Anyway, back to the question of "why?"

If your life is missing something back home FIX IT, but dont run away from it.

If your life ISN'T crap, and you are financially well off and have job security, and enough spare cash to have blow outs to Thailand multiple times a year, then why mend what isnt broken?

Then you might like to ask yourself "what skill set will i be bringing to the business?"

"Have i got any experience of, or proper inside info on running a bar?" And, no, its NOT the same as serving behind a bar!!!!

Just make sure you find out all the rules and regulations regarding shit like actually running a business. Look at work permit laws. Looks at visa laws. Look at EVERYTHING, because sometime in the future you are going to have to see which ones can be bent, how far they can be bent, and those which can be ignored (broken)and those which should NOT be broken/ignored/bent. And look at the consequences of getting caught breaking/bending the rules, too.

Remember....places like Pattaya are a great place to spend your money (thats why they were set up) They are very difficult places to make any decent money. (By "decent money" i mean an amount of money thats commensurate with the long hours you will have to put in, in order to protect your investment. Or even just an amount that you can scrape by on.)

And they are a desolate, depressing, places when the money runs out.

If, after weighing everything up you DO decide to go ahead, then make sure you have at least 5,000,000 Baht that you can afford to walk away from. Its no good seeing a bar for sale at a "bargain price" of, say 250,000 Baht, because thats doomed to failure right away !!!!! If it were any good it wouldnt be for sale at any price, let alone a bargain one lol !!!!

Good luck....you are going to need it

 

Hedonist

[razors edge]

that sounds so like my story back in 92 the best time i had in thailand was and is on holiday dont spoil that mate.

[Randy]

@Gulls, if this is more than a pipe dream (I've been there and so have many many mongerers) read the book 'How to establish a succesful business in Thailand' by Philip Wylie. He gives a nice overview of all the pitfalls.

 

I've worked the numbers myself for a bar in Pats and I found it might be profitable but probably it would end up being a very expensive hobby. And I would be too busy for serious mongering.

 

Having said that, there are successful bars in Pats but many more who barely survive. I agree with Hedonist, unless you really want to live in Thailand it's better for holidays.

[Edge]

You wont get any decent answers .........................................................................

.....................Its no good seeing a bar for sale at a "bargain price" of, say 250,000 Baht, because thats doomed to failure right away !!!!! If it were any good it wouldnt be for sale at any price, let alone a bargain one lol !!!!

Good luck....you are going to need it

Hedonist

Good answer and while we're at it, don't forget that when we talk about buying and selling bars, we almost certainly mean buying and selling leases on bars - usually 3 years at a time or the term remaing. Then you have the monthly rent to pay. You may own the bar fittings, but it's highly unlikey that you will own a bar.

 

Also, a farang partner is pretty pointless except to share the losses with. You need a load of licences to operate a bar and these will usually be in a Thai name - wife/GF/mamasan/cashier. Given that you are not allowed to work yourself, the licence holder is key to the operation and often has more control over staff and cash than the alleged "owner". If she walks out or you get rid of her then you cannot operate without getting the licences changed to another name. Is there a farang here who has these licences in his own name? I haven't seen one yet, but I may be wrong.

 

The mathematics of the business are not that bad, with a reasonable number of customers, but you probably won't have a clue what's actually going on. If you want to enjoy yourself as well and you don't want to be manacled to the bar every soddin' night you won't even bother or be able to find out. The chances are the wife/GF/mamasan/cashier will be making more out of it than you.

 

As hedonist says, the ones who have made it work won't be rushing to tell you how and everyone else will be saying don't do it, unless they have a bar (lease) for sale of course.

 

BTW you should try searching the board - the Q crops up quite often.

Edited November 12, 2009 by The Artful Codger

[Erasmus]

Before coming to Pattaya, I read all the stories about the local bar business. That's in the context of knowing the bar biz rather well back in the US (and somewhat in Europe too).

 

After 5 weeks here, having seen a fair share of bars and chatted with several former/present/hopeful bar owners, I came to the conclusion that after all is said and done, Pattaya is no different than anywhere I have been around the world: Everybody think they can run a bar, the majority of them just burn money until dry and a small handful actually do know how to do it and do well at it.

 

It has little to do with Pattaya, New York or a shit hole in the Amazon. It has to do with knowing how to do it. I am 100% sure that the ones who do well here would do well anywhere else and the ones who do not would just burn money faster elsewhere.

[iching]

No wait here's a better one. Get rich selling bars and restaurants to wide eyed foreigners. Then get em back for free when the new owner can't make the balloon payment. Usually all remodeled. Then sell it again. This one is actually viable and being done.

 

When there`s a gold rush the only person to make money is the person selling shovels

[Randy]

... It has little to do with Pattaya, New York or a shit hole in the Amazon. It has to do with knowing how to do it. I am 100% sure that the ones who do well here would do well anywhere else and the ones who do not would just burn money faster elsewhere.

 

I agree with that, but if you're good in running a bar it might be more profitable to first run a bar in New York or Japan, save as much as you can and then open several bars in Pats! This will get you more money faster than successfully running 1 bar in Pats and saving from that.

 

And dont forget there's still cultural differences as well. And speaking Thai is a must I think.

[gazza65]

I agree with that, but if you're good in running a bar it might be more profitable to first run a bar in New York or Japan, save as much as you can and then open several bars in Pats! This will get you more money faster than successfully running 1 bar in Pats and saving from that.

 

And dont forget there's still cultural differences as well. And speaking Thai is a must I think.

my 2 mates moved 2 cambodia and told every1 they would make loads of money.

they bought in 2 a bar,hotel and even sold ice creams. 1 has just got back 2months ago

and the other 1 would love 2 come home.but he has a cambodian wife and 2 children now

both said they would b rolling in the money.

wel they dont hav jack all now,both would hav been better of stayin here makin money.

but i suppose foreign men get great idea's, when they r sittin with beautiful thai women.

and i know this is about thailand but same mugs do the same things in cambodia

[Erasmus]

And dont forget there's still cultural differences as well.

You are right, New York would be a tough one. LOL

[Daryle]

I go to bars - don't like the owners.I like the women and would never own or run a bar.

[themosch]

This could work if you do this for the right reasons: not making money as it's almost impossible from the first time but having some activity to fill your days while living in pattaya.

I don't see many farangownedbars that make large amounts of money so don't expect that yours will! Another misstake is that many newbies invest heavy at the begin and when things go bad have no reserve!

A good plan is to go live there and learn the scene and city. Start with something small with low investmentrisks so you won't loose your entire cash with beginners-mistakes or traps! Call this money a newbie-fee. When you learned all risks, problems and traps you can look for the real deal. You can ask many owners but a few will say that their first bar was a direct succes!

It's a nice place to live if you have the money, but it isn't a nice place to make money! Just see the business as a reason to fill your days not to make money! It's much easier to make money at your home as in LOS!

[jamilv]

I have been looking at a few....most gogos and beer bars I saw were between 10mil baht and 20mil baht....but they say their monthly income is like +500,000 baht...so I dont understand why they are selling them so cheap, most businesses sell at 6 or more times the yearly income

 

either way if you buy an established bar/gogo they seem to already all have staff and everything up and running, its just a matter of taking over and overseeing the operation.

I am in contact now with a guy who is selling a beer bar at 10mill, he already has staff, managers and everything and said he would provide some help with getting started. After expenses he said he makes about 400,000 baht a month which seems reasonable from an investment point of view.

[panasar]

Simple answer - dont even think about it.

You cannot work in it, you have to trust Thais to run it for you.

I think you can work out the rest.

[hedonist]

I have been looking at a few....most gogos and beer bars I saw were between 10mil baht and 20mil baht....but they say their monthly income is like +500,000 baht...so I dont understand why they are selling them so cheap, most businesses sell at 6 or more times the yearly income

 

either way if you buy an established bar/gogo they seem to already all have staff and everything up and running, its just a matter of taking over and overseeing the operation.

I am in contact now with a guy who is selling a beer bar at 10mill, he already has staff, managers and everything and said he would provide some help with getting started. After expenses he said he makes about 400,000 baht a month which seems reasonable from an investment point of view.

Talk is cheap. Ask to see the books, and you might get a different idea of what he makes month after month. Due dilligence is essential

I have said this before, and will say it again now:

Golden rule #1 is only put in what you can afford to walk away from

You are talking of a multi-hundred thousand Dollar investment. If you can afford to walk away from that kind of money, then........why do you need to work at ANYTHING, anywhere, in fact?

 

Heres a couple of links you might like to look at:

 

<a href="http://www.ustream.tv/channel/walking-street-pattaya">see how "busy" Walking Street is these days</a>

 

<a href="http://www.nationmultimedia.com/search/read.php?newsid=30118523&keyword=Inbound+tourism">34% drop in tourism</a>

 

And THAT'S off the back of last years "high season", which was one of the lowest on record ....until now

 

Pattaya... a great place to spend your money, but a piss poor place to MAKE any. And a vicious, desolate place when you run out of money.

 

Hedonist