Welcome To Thailand
Have you noticed a few similarities running through the Stick Submissions now and then?
First everyone was quoting their favorite singer or writer. Just a sentence or two. Then it was verse or poetry if you can call it that.
Next, people are bouncing off of each others' submissions. I have done this myself and I like it. One idea begets another. Or two writers may disagree. I may be feeling mean today but I get a laugh when Korski smacks Dana around verbally. I can just see him stamping his little feet and running to hit the block sender button. Hey, if you can’t stand the heat, why leave your email address? Do you expect it to be all hearts and flowers?
Casanundra hit so many nails on the head with his submission 'Investing in Thailand' that I would like to add my two cents, if I may.
There seemed to be two central themes to his submission, which was Thais trying to grab a bit of cash from you or asking for money with no intention of paying it back and a lack of a business plan on anyone’s part.
His story started out in Phuket which is where I live. Residing in a tourist area, one can not help but be subjected to some harassment.
But holy smokes it’s never ending. I have been living in Rawai for the past eight years and I think it’s one of the least touristy parts of the island. But maybe not. When I put gasoline in my car I am short changed eighty percent of the time, or at least they try to. There are really only a few gas stations in the entire area. Wouldn’t they become tired of this?
Sometimes it’s hard to read the green digital numbers on the gas pumps so I always get out of the car and they still hold back sixty or eighty baht. It’s really annoying when you can see the rest of your change in their other hand in case
you ask for it. Yesterday I was out of the car pointing to the price on the pump and the girl still did not want to give me the proper change. I had a complete fit. I went berserk. Two other attendants came running over and convinced the girl
to part with the eighty baht she was holding back. But some how she owed me one more baht and I insisted on it. I ranted and raved but no one could come up with a one baht coin so I eventually left. On the way home I started shaking my head saying,
'Frank, you’ve got to get a grip on yourself.' The next day I asked my friend Randy who has also been here eight years how many times this has happened to him and what do you think he said?
'I don’t know. I just give them money and they give me change.' For once I was speechless. Then there is the photo store on Chalong circle where I have been going for years, spent hundreds of dollars there and the lady owner constantly tries to short change me.
After eight years they must have some idea that I live here and am not just a tourist passing through or is it a matter of pride and practice with them? Screw the farang. I never go to Patong anymore. There is a popular disco at the end of Soi Bangla, away from the beach, on the second floor that charges admission and almost never gives anyone the correct change. Don’t even mention the tuktuk drivers please.
I went to buy a new Toyota a few years back. They had two on the floor – one fawn colored and the other one black. The saleslady was telling me that this year the Corolla would only be coming in these two colors and which one would I take? I asked her if she said that to every customer or just the ones that looked particularly stupid.
I was getting crazed and insisted on an answer, asking her three or four times but of course I got nowhere. They just give you that idiot smile like Casanundra says.
I have a friend here that’s an architect, psychoanalyst and university graduate so he’s had some education. He ran into a Thai lady money lender who promised him double his money back in three months and if he wanted to leave it with her she would really build up a nest egg for him. Now he’s lived here a long time and knows that she’s the real deal so he gave her forty thousand baht. Three months go by and nothing. He asks her for some interest on the money. She shrugs her shoulders and says 'no have.' Now he can’t go to the police and he can’t get tough with her, if he wants to keep on breathing, so he’s stuck.
But let’s get to my favorite part and that’s business plans. Does anyone here really take the time to figure out how much money they have to take in to survive? It’s a relatively easy thing to estimate. There is a restaurant a block away from me, first opened by a Canadian guy who wanted it for his girlfriend so bad that the owner raised the rent from twelve to seventeen thousand baht a month. The Canadian had the brilliant idea of opening a Cantonese Chinese Restaurant, after all, there were none around here and doesn't everyone have fond memories of chop suey or egg fu young or General Taos chicken.
I said, maybe there’s a reason there aren’t Chinese restaurants here. Thai food is tasty and inexpensive’.
Yes but this will be the real thing.’
So you can cook Cantonese food?’
No but I’ll hire someone who can.’
He could not find anyone that could even remotely cook Cantonese food and the restaurant never took off.
It was reincarnated as an Authentic Belgian Restaurant by a couple visiting Phuket. The prices were high and the portions small.
Next a farang bought it for his Philippine girlfriend. Put in glass walls and air conditioning. Spent a lot of money. The girl was so stunning she probably had guys lined up waiting to dump cash on her. The restaurant stayed open three weeks. Now some farangs have bought it.
They tore down the glass walls and air con. Painted it white and blue and it looks pretty. It’s ready to open if their advertisement in the Phuket Gazette can find them a cook for Thai and foreign food, must speak English. Is this spot doomed to be operated solely by amateurs?
There are two things that would seem apparent if you looked at this location. But has any one of the previous or current owners noticed?
First is that there is no parking what so ever. Possibly for a few motorbikes. The store is smack on the street, not even a sidewalk to separate it from the traffic and it’s almost on an intersection. If you had a car there is no way you would park it anywhere near the place and more importantly the store only has a half dozen tables. Now the less tables you have the more you have to charge to meet your monthly nut. If you have more tables you might be able to do some extra business by lowering your prices and having more customers.
This will be yet another farang restaurant of some kind.
In the mean time there are some really outstanding Thai restaurants on the same street charging thirty-five to sixty baht for a meal.
You’re looking at some tough competition here.
Casanundra mentioned a business plan, target market, risk factor and return on investment.
I could sit down and knock out twenty pages on this topic and Casanundra could probably knock out forty more.
But let’s keep it short and simple and only talk about breaking even at the end of the month.
Think of this as just a very small part of your feasibility study.
Write down all of your monthly expenses. Start with your lawyer, accountant, sales tax, government taxes, rent, salaries and so on.
As for the food and liquor costs, we will have to estimate them. In America the average food cost is 35% and the average liquor cost is 23%.
(That is if you pay 23 cents for a beer -you sell it for a dollar.) In Thailand I believe the liquor cost is even higher because of all the beer sold and to me it does not look like there is much profit in that.
Let’s just say that you have added up your monthly expenses and they come to 200,000 baht without the cost of food and liquor.
Average out the food and liquor cost to 32% to make this easier.
Now if the gross is 100% and food and liquor are 32% that means that all of the expenses you have added up are 68% (68% plus 32%=100%).
To find the 32% in cash, divide expenses (200,000 baht) by 68% and you also find the gross sales which comes to 294,117 baht.
This is what you must take in each and every month to break even.
How many people will have to come into your store and how much will they have to spend each and every single day to arrive at this amount? Let’s say you have twenty seats and you fill up once for lunch and once for dinner. This is an ambitious estimate.
So you do forty covers a day times thirty days which equals 1200 covers for the month.
Divide estimated covers into gross sales to find an average check per person. 1200 divided into 294,117 equals 245.09 baht.
These calculations are only a guide and a small start at that, on your way to thinking about going into business.
Suppose after all your hard work and careful planning you open your restaurant and everything is going excellently and the money is pouring in.
Now suppose a few weeks later a Thai bar opens next door and the music blasting through is making your wine glasses rattle.
The bar is filled with Thai toughs and / or cops. You know what?
Welcome to Thailand. You’re screwed.
Hahaha. I had to laugh at the ending!