Don't open a business in Thailand (part 1)

I have lived in Thailand for almost 15 years. I am one of the few business owners that escaped without losing everything I put into it. I was partially lucky and partially smart. The system is rigged and you are not allowed to succeed - at least not as a small business owner.

Before I start to sound too jaded, i want you to understand that I actually came out on top. I didn't lose all my money so this is not just the rant of someone that got burned by a system they didn't understand. However, I am going to present multiple REAL stories of people I personally know in an attempt to prove my point. I will include my own story at some point in this series.

I have changed all the names but I can assure you all of these stories are true.

We'll start with a Swedish guy named Pelle.

Pelle owned a bar in Sweden that was very successful and found himself with a bunch of time off each year because the island where his bar was located was a "summer only" island in Sweden that during the off season wasn't even open because there are no people there and there is no reason to be open. Therefore he traveled the world from November to March, every year.

As luck (or lack thereof) the "high season" of tourism in Thailand is the opposite of the high season in his home country of Sweden. He found a place that he really liked in Thailand and decided to open at resort there.

He was very careful, deciding to have a lawyer and make certain the terms of his lease were in his benefit. He didn't skimp on this, he did everything correctly and secured the maximum lease that is available which was 3 back to back 3 year leases. He invested a great deal of money building a pool, making bungalows, and creating a bar and restaurant that was close enough to the beach to be attractive but far enough away from the main road to still be quiet. It was truly a wonderful spot and at $30 a night, it was quite a bargain.

actual photo of the actual place in question

the poolside bungalows were simple but cheap, they got the job done

A few years went by and the resort was doing very well.... A little bit too well as a matter of fact.

Jealousy by neighbors started to happen and Pelle suddenly found himself being questioned by the tax office about his receipts for guests. Because he does everything "by the book as it exists in Thailand" he provided said receipts. The tax officials would come back, this time with police officers and state that they "reviewed his receipts and he owes xxx,xxxx baht in back taxes ( I don't know the exact figures and I am not going to guess.)

Pelle refused to pay and then went to court against the tax office. After 1.5 years in court, Pelle won. However, during that time he incurred nearly 2 million baht ($60,000) in legal fees, which was supposed to be repaid to him if he was victorious in court. This was 8 years ago and he still has not received this money.

A few years went by and the place continued to do well, but then things started happening like taxi drivers all of a sudden "forgetting" where his resort is. The water was routinely cut off to his facility despite the fact that he was always paying the bills on time. He built a water back up system with his own money (of course) only to discover on several occasions that the PVC leading to the tanks had been cut with a saw, or the pump had been sabotaged.

He next hired a night security guard who was an ex champion boxer...... The problems stopped for a little while

it really was something else

The problems continued year after year and after a while his online rating started to suffer because it was such a battle to keep things running and he wasn't really making much money anyway. However, he was still profitable and the place looked great, the staff were happy, and he was still enjoying about 80% occupancy during the tourist season (this is very very good.)

After 9 years it came time for his lease to be renewed and the owner of the land told him that he would let him have 1 more year at the current rental rate but after that the price was going to be THREE TIMES the amount he had been paying.

At this point Pelle just decided to give up and walk away because he was barely making any money anyway and the resort had deteriorated to the point where it was just a place for him and his pals to hang out. Pelle, myself, his motorcycle club, and loads of friends that he had made over the years came together with all of our vehicles to help him move everything we possibly could out of the place.... including most of the vegetation that he donated to places including local schools.

I am actually happy to say that this particular plot of land still lies vacant. There is no replacement business that moved in to the spot that he had built into a once thriving resort. I can't say for sure, but I think it was jealousy of the neighboring hotels that created unnecessary 6-year long spiral of decay that eventually lead to the demise of a business that was doing well and employed a dozen Thai people who were quite happy with their jobs.

Recently (nearly 4 years later) there has been some construction going on at the property, but they seem to be going very slow, which normally indicates they keep running out of money.

I am also proud to say that every time I go to this part of town I park my bike in the parking lot of what was once the Ao Nang Tropical Resort, and i do so with a full bladder to show my appreciation for the new, far-from-finished buildings.

As always, i welcome your comments, suggestions, and eagle eyes for my bad spelling.