How To Fund Your New Life Overseas


March 5, 2014, Panama City, Panama: Starting a business overseas can allow you to fund your new life in the foreign country of your dreams.

Dear Live and Invest Overseas Reader,

A friend in Poland years ago learned that Burger King was planning to open up shop there and needed warehouse space for its supplies. My friend bought a warehouse. Burger King became his client. In time, he expanded his storage business to include other clients and other products...and he made a nice living for himself in the place where he'd decided he wanted to live.

Another friend noticed how few coffee shops existed in Warsaw. (This was 15 years ago, before Starbucks came to this town.) My friend found a local roaster to roast the coffee beans and then packaged them himself. He set up a combination retail and wholesale operation that was bought by another larger one. That company is still going strong.

Some of the best overseas businesses start like these two--organically. You show up, discover a market niche, and find a way to fill it.

Other business start-ups can be more pre-planned.

About seven years ago, I took early retirement from the company where I'd worked for nearly 23 years. Six months later, I realized that retirement didn't suit me. I liked being in business.

For me, the question wasn't, what business might make sense? (I enjoyed the business I'd already spent 23 years learning how to practice.) For me, the question was, where best should I base the business I want to launch? (Panama stood out as the obvious choice.)



In other words, there are two ways to approach this--you can look for the best place to start the business you know you want to launch...or you can look for ideas for a business that might be successful in the place where you want to be. The good news is that it is easier today than ever and ever-easier in today's world to start a business of your own almost anywhere in the world you might decide you'd like to hang your hat.

The easiest and increasingly common approach is to pursue a portable profession (as a writer or a consultant, say). For this, all you need is a laptop and a reliable Internet connection. Going this route is a chance to go into business for yourself, to be your own boss, and to make your own money...without incurring the hassle and the overheads of a full-fledged business.

Perhaps, though, you're up for taking on the liabilities, headaches, and hassles that come along with running a fuller-fledged business. Perhaps you (like me) are interested not only in generating revenue and income, but also in the adventure and challenge of building something. If this is the case, here are six ideas to consider.

International Business Idea #1: A Franchise

A franchise can be an easy way to hit the ground running with a business model, strategy, branding, marketing, and support already in place. An already proven successful business can give you a leg up.

One franchise business opportunity in Panama crossed my desk recently. The regional manager for the Mailboxes Etc. franchise was looking to expand.

Mailboxes Etc. is well established in Panama already (with 18 stores), and, based on the success to date, was interested last year in growing the group to include a new store to service the Playa Blanca area near Rio Hato. This is the heart of the popular beach area about an hour-and-a-half outside Panama City, where many expats are settling.

You may be interested in neither Panama nor the Mailboxes Etc. business. However, I'd like to walk you through some numbers here, for your general reference.

The total start-up cost for a Mailboxes Etc. is US$60,000 to US$70,000. You don't have to speak Spanish to open one of these operations, as most of your customers will be expats like you. Several non-Spanish-speaking franchisees already run stores in Panama and Costa Rica. Another plus is that a Mailboxes Etc. does not require much staff. A typical store can be run with three local employees. Your staff overheads are controlled, therefore, both because you don't need much and also because salaries in this country are very reasonable. The quality and the cost of labor are two of the biggest doing-business appeals for would-be entrepreneurs in Panama.

Mailboxes Etc., like any franchise, provides training and operational support leading up to and during the opening of a new store and then, as well, ongoing support as long as you need it.

What kind of return could you expect? The franchise manager explained to me that stores in this part of the world typically reach a point of monthly profitability after six to eight months of operation. Earnings are typically US$3,500 to US$5,000 per month the second year and US$6,000 per month thereafter.

International Business Idea #2: A Tourism-Based Business

A tourism-based business (a bed and breakfast, dive shop, bar, restaurant, souvenir shop, ice-cream parlor, coffee house, wine store, etc.) can be a good choice depending on your interests (do you like to interact with people day-to-day?) and your location (are you interested in living in an active tourist destination?).

International Business Idea #3: An Expat-Based Business

If the place where you want to launch your new life overseas is home to a decent-sized expat community, the best way to identify an idea for a business to launch can be to think about all the things that you yourself miss from home. What products and services do you wish were available? Chances are good that your fellow expats long for these same things. An American I know in Argentina, for example, has been very successful with the Mexican restaurant he opened because he missed Mexican food. Turns out, other expats in the area did, too.

Other expats I know have opened a fitness center (on Ambergris Caye, Belize), wine shops (on Ambergris, on Roatan, and in the Dominican Republic), and short-term storage facilities (in San Juan del Sur, Nicaragua)...in each case because these were services they wanted that didn't already exist in the places where they wanted to be.

International Business Idea #4: Real Estate

Real estate is an industry that many expat entrepreneurs gravitate toward. In fact, I've known more gringo real estate agents in more developing countries than I could shake a stick at (and, often, that's just what I've wanted to do to these guys).

Gringo real estate types in sunny climes tend to get a bum rap, because, often, they approach emerging-market real estate as a get-rich-quick plan. If you're up for taking a longer-term view of things, this could be a good business to consider. You bring an understanding of the efficient real estate market to places where the real estate markets are typically anything but.

International Business Idea #5: Import/Export

Almost everywhere I travel, I notice something that I think might have a market someplace else. Garden urns and antique furniture from Ireland, for example...hand-carved wooden santos from Ecuador...uniquely woven baskets from Panama...leather jackets from Argentina...sweaters from Peru...hand-painted tiles from Colombia...wood furniture from Indonesia...silk from Hangzhou...

These are all opportunities for the would-be importer-exporter.

A great deal of research and planning is required to pull this off on anything grander than a suitcase-by-suitcase scale, but buying something cheap in one part of the world and selling it for multiples of that price in another is a real and viable opportunity to make money to fund a life of adventure.

International Business Idea #6: A Business Geared Toward The Locals

My friend who started the coffee business in Warsaw really was on to something. He saw an opening in that city's local market and went for it.
Making a success of a business geared for the local market requires that you first understand the local market--what do they like, what are they already buying, and, critically, what might they buy if it were available?

The best case is when you can import or transplant a business idea you've known to be successful somewhere else but that doesn't yet exist in your new place of residence. This is what my friend did in Warsaw. He didn't invent the coffee-shop business...but he recognized that, while people in Warsaw like and pay for coffee, at the time, no Starbuck's-like coffee venue existed. He identified a market niche and, as well, a successful business model he could transplant to fill it.

Kathleen Peddicord

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Kathleen Peddicord

Kathleen Peddicord is the founder of the Live and Invest Overseas publishing group. With more than 25 years experience covering this beat, Kathleen reports daily on current opportunities for living, retiring, and investing overseas in her free e-letter.

Her book, How To Retire Overseas—Everything You Need To Know To Live Well Abroad For Less, was recently released by Penguin Books.

Read more here.

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