HAVING YOUR OWN BUSINESS

Spain is traditionally a country of small companies and sole traders. There are nearly two million families running businesses employing about 75% of the working population. The majority of businesses established by foreigners in Spain are linked to leisure and catering or to property sales. Why? Low entry cost and providing a service in one’s mother tongue are key factors. People choose to be self-employed for the lifestyle and freedom it affords, but small businesses in Spain often exist on a shoestring with their owners working extremely long hours, particularly those running bars or restaurants. Many foreigners start businesses in Spain with little research, little business acumen, no knowledge, no capital and no linguistic ability. It is asking for trouble.

The first step is to conduct appropriate market research to establish whether there is a real need for a business in the area, and secondly to check that all necessary licences for the proposed venture actually exist or can be obtained. These could include the Opening Licence and, if appropriate, a licence for serving food (see pages 115–116 for more details). The purchase of an existing business to be run exactly as before will not require a new opening licence, but if the nature of the business is changed, a new one is required.

Before establishing a business, it is important to talk to a number of people to obtain legal advice and to take advantage of any tax benefits or grants. This advice is usually obtained from a lawyer (abogado) or an accountant (asesor fiscal).

POPULAR BUSINESSES

Bars, cafés and restaurants

Many people dream of running a bar or a restaurant in the sun. Some have been successful, but for every successful catering establishment there are many more that have ruined their owners. Competition is fierce. The hours in the height of the tourist season are very long. A normal bar or restaurant in the summer months will be open until the small hours of the morning and then be open again for lunch the next day, seven days a week. In peak season it cannot close for even a day since its customers will go elsewhere. A catering business also suffers from world events, disasters, climate and the economy.

Computer sales and service

While most people use computers, few know what to do when problems arise. Many ex-pats need an English-speaking expert to sort it out; someone to stop computers crashing, get our programs running smoothly and somewhere to buy bits and pieces including user friendly English language software. Anyone skilled in graphic design can also find a niche for web design and short-run print work –advertising, posters, banners, flyers, programmes, menus, invitations, etc.

Construction work

Painting and decorating, plumbing, building, carpentry and similar skills are in demand from ex-pats who want to use the services of tradesmen to whom they can describe the required task without any language problems. Many offer their services as part of the ‘black economy’ and are paid in cash. However, moving into large contracts will mean dealing with a different customer base –people who want IVA receipts to reduce their liability to income tax.

Estate agents

Opening an estate agency business is easy. Unlike many other European countries, the estate agency market in Spain is not regulated. There are many people working in Spain in real estate without any background or qualifications, although some are registered through a professional association. A booming property market means a very good standard of living. On the debit side it is a results-orientated business with a hard-sell approach and a poor reputation.

Hairdressing

Good hairdressing and beauty salons flourish. Many women go to a hairdresser on a regular basis, preferably to one where they can at least chat to the operator. Hair dressers offering additional beauty treatments have an advantage. Independent mobile hair dressers can also make a good living.

Hotels, guesthouses and B&B

This is yet another area where people dream of having a successful business in the sun. With a good establishment, in a good location, look at a capital cost of one million euros. Too much? Compromise on location by going to the country and renovating a ruin! Income from a modernised premises is only 50ε per night for a double room. The holiday season is short, so the room-occupancy rate is only 25% over the year. Most visitors to the coast will rent an apartment or stay in a budget hotel on a package holiday. Guesthouse and B&B demand is mainly in the inland areas for independent travellers where it would be unusual for guests to stay more than two or three days before moving on unless the location had something really special to offer.

Kennels and catteries

While finding the right premises may be difficult, demand is high. If someone wishes to go on holiday or back to the UK to visit friends and family – where does the dog or cat go? People who live in Spain welcome a good English-run kennel or cattery for their animals. Opening a kennel or cattery means a place in the country, but a word of caution -just because a person has bought land in the country does not give them a right to open a business. Planning permission is necessary.

Property management

This covers property cleaning, pool maintenance and gardening. This is relatively low paid, unskilled and seasonal, but if correctly managed can be a successful business.

Satellite television installation

This is one business where there is little Spanish competition – the language barrier in reverse. Demand for English language TV is high —or to be more direct, demand for a SKY package is high. While new urbanisations and apartments have communal satellite receivers, there is demand from owners of individual properties.

Shops and boutiques

Selling the right product in the right area can be very successful. Examples are a flower shop, an English bookshop, a butcher, a small supermarket with British products and second-hand furniture shop.