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Exotic, but not easy: Starting a business overseas

07:00am November 08 2018

Five small business owners give their top tips on opening up in foreign countries. (Josh Wall)

It is a big leap opening a small business.

Marketing, staff, capital, loans, competition – and that’s just the beginning.   

But opening a business in another country where English is the second language, or hardly spoken at all, and navigating regulation – or lack of it – is a whole other ball game.  

Austrade, the federal government body designed to assist Australian business, says it does not have any complete data on the trend.

But, anecdotally at least, it says more-and-more Australians are making the jump. It recently expanded the number of “market profiles” on its books to 50 countries, giving Australians looking to expand overseas – or open new businesses – an insight into market conditions across the globe.     

Westpac Wire spoke to five separate small business owners from five of the more exotic places on earth: Costa Rica, Solomon Islands, China, Cambodia and Bali to find out what it is like to make the jump in a place where the landing may be a little bit trickier than home.

For Gary Burchett and his family, opening their small business was more like a leap into the unknown.

CrossFit Surfside’s Rachel Burchett (left), Gary Burchett, Nicholas Taylor and Samantha Morey. (Supplied)

It was December 2015 and Burchett, his wife – both TV production specialists – and their two daughters hopped on a plane from Sydney to Mexico to “learn Spanish and live a simpler existence”.

They didn’t have return flights.

After an eight-month “driving odyssey” around Central America they found a home in Playa Potrero on the north Pacific coast of Costa Rica and have lived there ever since.  

The couple had always harboured a desire to own their own business – and being CrossFit “fanatics” they combined the two.  

“We knew a small business would be a great way to integrate ourselves into the local community,” Burchett says.

“After 20 years of reporting up (across various media outlets in Australia and the UK) we craved the autonomy of our own decision making.”

They opened the doors to CrossFit Surfside in June last year. And apart from a few bumps along the way, the couple haven’t looked back.  

Burchett says the most pertinent piece of advice he can offer is to “use local knowledge”.

CrossFit Studio, on Costa Rica’s north Pacific coast. (Supplied)

“Guesswork will only get you so far,” he says. “From the outset we forged a business model that was inclusive of locals and expats alike. And so far, it’s worked.”

He says they hope to open a CrossFit retreat as their next venture. “And maybe something involving my other passion – wine,” he adds.

They may operate in similar tropical climates, but for Colin Dyer the back story to his business venture could not be any different.

Colin Dyer in The Solomon Islands. (Supplied)

Dyer, originally form the Sunshine Coast, first visited the Pacific Island nation of Solomon Islands in 2002 – a time when the country was in the midst of an ethnic civil war.      

Working with a church group to help village communities rebuild in the midst of the conflict, Dyer, a business and marketing consultant, was taken aback by how uneducated the communities were in basic commerce.  

As the conflict eased in the mid-2000s, he began working with the communities independently through NGOs (non-government organisations) and saw an opportunity in a developing agribusiness: coconut oil.

“We wanted to be able to model the things we were teaching,” Dyer says.

“And there was a technological development (a small, transportable oil press) that enabled us to bring the coconut oil production to the villages.”

From that, Kokonut Pacific Solomon Islands was born – a company that today supplies the oil for the retail brand Niulife.      

Dyer and his wife started out small: 10 villages in two separate areas of the island nation. Of those 10 with the oil press, only four survived. And after almost 15 years operating in the county, roadblocks he hit in his first year of operation are still encountered today.

Austrade warns anyone looking to open a business in Solomon Islands to be aware the country operates on “island time” – a loose concept meaning partners may be late to meetings, or not turn up at all.  

“It can be incredibly frustrating. But I’ve learnt to focus on the process and not on the failure,” he says.

“Operating in Solomon Islands, and the Pacific in general, you have to be ready for the unexpected. You have got to keep your expectations reigned in, be prepared to make incremental steps.

“Even though the legal framework or administration framework says something, that doesn’t mean it works that way.

“You have to understand the context in which you’re operating in. We might have five things to do, but if we get one thing done, that’s a win… and keeping that mindset, it saves you going insane.”

Today, Kokonut Pacific has 120 localised processors in villages all over Solomon Islands, however only 60 are operational. His advice is simple: “Listen, watch, learn”.

And being a social enterprise – where all profits go back into community development – he says the daily frustrations are 100 per cent worth it.

“Solomon Islanders are wonderful people, and you see some great things happen. But if you’re looking to open a business and make a lot of profit in the Pacific, particularly in Solomon Islands, forget about it,” he says.

There are many elements of operating a business on mainland China that have tested the sanity of Andy Curtin.

In a place where the government can shut the doors at random and legislation can change in an instant, Curtin has one piece of advice that he says works across the board.  

Andy Curtin of Kung Fu Komedy. (Supplied)

“Be flexible,” he says. “Everyone I know who's been successful in China had a dramatic transformation from their original plan.”   

Curtin, from Melbourne, says he fell into his business by pure luck.

The financial analyst was doing stand-up comedy as a hobby at night when his day job started “turning south” and the hobby reached a point where it could become financially viable as a full-time venture.

So he decided to plug his money into opening his own comedy club in Shanghai.

Opening an unusual business in a place such as Shanghai had its challenges, but Curtin says there are elements that kept his head above water.    

One is making “clear and concise” plans and contracts with local partners.

“On that I would say also: don't take on close partners until you are very comfortable with the partnership,” he says.

“And don't start a business here from outside China. You will get screwed.”

Curtin, who now also works as global events company Live Nation's Asia comedy business manager, also advises always having a toe out the door in China.

“Always keep an eye on your exits,” he says. “Whether you're cashing out of a business, or leaving China altogether, this is the hardest part to get right.”  

Kerryn Peregrinus spent time in China herself before leaving for Cambodia to open a bar and arts space, partly due to the complexities of the former’s regulatory environment.

Kerryn Peregrinus, originally from Melbourne, at her bar. (Supplied)

“I spent a fair amount of time in bars (in Beijing) and one bar in particular, Más,” the former Melbournite says.  

“That was my local and I developed a strong friendship with the publicans.

“When it was closed down … they decided to move their trade to Cambodia and I thought I’d join them.”

According to Austrade, Cambodia is one of the fastest-growing developing countries in East Asia, with one of the youngest populations in the world and a vibrant tourism sector – the perfect environment for a bar.  

Peregrinus, a former university lecturer and voice actor, had never operated a business before and found out pretty early on that trying to do everything herself – particularly in a new country – wasn’t going to work.

“My advice is don’t go with your first plan because you think you got it right the first time,” she says.

“Also, don’t make a budget that is every cent of your savings. Budget for less so when you discover under counter refrigerators (for example) are insanely expensive, you have some extra dough to throw at it.”  

For Leah Hills, the owner-operator of The Bali Tailor – a specialist leather goods and fashion retailer – in Bali, operating in a foreign market is all about respect.

Leah Hills in her shop in Bali. (Supplied)

“Remember where you are,” the former Ernst & Young risk advisory services manager says.     

“Dot your I’s and cross your T’s - you’re not in Australia anymore so know and respect this.”

For Hills, it all started nine years ago when she was holidaying in the popular tourist island and visited a local tailor creating various leather goods.

“I remember thinking ‘I can do something with this’,” says Hills, who now splits her time between Bali and Sydney’s northern beaches.

It wasn’t Hills’ first crack, previously having fashion store Made in Bali in the 2000s until she sold it in 2009. With that on-the-ground experience in mind, she became a “middle man” for people wanting tailor made leather items out of Bali, whilst testing the waters on whether a standalone business was viable.  

She says the spread of social media enabled her to find new markets outside of Bali, and triggered her decision to set up The Bali Tailor’s first store in the island’s trendy suburb of Seminyak, with a second one planned in nearby Canguu.

The business has grown to 38,000 followers on Instagram exporting from online sales all over the world.    

“We’re also working on ways to grow our online presence – this is a huge growth area for us,” she says.

“But we’re so lucky that we’re in Bali. It’s an amazingly creative island with so many resources and incredibly talented local artisans – and it also helps that the lifestyle you can create here is one I wanted to live.

“And I guess my one major piece of advice would be to always value, respect and listen to those that are working with and around you – every person plays a vital role in making your business what it is.”

The views expressed are those of the author and do not necessarily reflect those of the Westpac Group.

Nick Sas is a former business-technology reporter at The West Australian now based in Sydney as a digital reporter for the ABC. He spent 2017 in Solomon Islands through the Australian Volunteers International program helping the local broadcaster, SIBC, develop its digital media footprint.

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