Chile Forum

The thing that drives us nuts about Temuco more than anything else is that if you go to an expensive restaurant or cheap restaurant, it is the same except for the wine list. They all have the same menu items. I do not even need to really open the card to order at most restaurants in Temuco. Now that is changing slightly. There are like 5 sushi restaurants in town, and they all opened in the same week. None of them know how to make sushi. At least the fish is fresher here than in Japan, so no real harm done. It is just not good sushi.

Service industries, if you can get over the employee training culture problem, is lacking in just about every area. Find a service industry and do it right. Done right, service industries make big money because there is no competition and almost no Chilean company has figured out how to provide it.

I like to repeat this story every time this topic comes, but it is relevant. An old partner of mine in another country in Latin America said it. You don't need a new idea in Latin America, you just need a good idea. Don't try to get too creative. Better to adapt something you know has always made money in other countries, and make it work in Chile.

For instance the little store idea. I have been seriously considering opening a couple Temuco. Go to the riches neighborhoods in any city, with a high population density. Drive around until say you find an area where there are no stores open late for kms in every direction. Then make it safe and well lit, and you will be rich. Think 7/11's in the states and how much money they make. Some of the poorest areas in Chile will have like 5 stores on every block, and some of the richest you will have to drive 5 km or more at just 4 in the afternoon let along 10 pm at night to buy milk, bread, or a good bottle of wine.

For 125,000 US, you could likely open a half dozen of them, and close the ones that don't poll their weight. The other thing I see among those little stores that do exist is that they never figured out that because you are the only store, you can charge more money. They try to compete with the super market prices, when they could charge from 5 -50% more on products and at least in a rich neighborhood no one would bat an eye.

Basic marketing and buisness management 101 does not trickle down to the small buisness in Chile. Keep it simple.

Honestly, since I have been in Chile I have started at least 7 different businesses (all at the same time) and they all made money. I just dropped several because some made more money than others. I mostly dropped them because some consumed more of my time than others. In fact, I have never closed a business here because of financial reasons so much, as more quality of life issues such as enjoying the work or the amount of flexibility it provided in my free time. I could have likely made a good living at any of them.

I also have a sort of Darwinian theory of small buisness. A good business idea is one that you invest money in and get a return. A great buisness idea is one that you invest almost no money in, and get a return. A great buisness idea should make money out of the gate, and self-finance its own growth naturally. It is kind of corollary of 'don't throw good money after bad'. In fact, don't throw money at it at all (well as little as possible). Nothing ventured, nothing lost.

If it is a good buisness, it should make money all by itself or you need to start asking yourself if the demand is really there.

The growth will be natural, and you can avoid the mistake of over expanding too fast. I burned a really good buisness to the ground when I was about 24 years old in another country because no one told me that over expansion can be more dangerous as under expansion at any stage of a buisness.

Now, I buy each piece of office furniture and hire each employee only after a good amount of kicking, screaming, and racking my brain for a way to get around it. I apply the same policy to my Chilean employees. If they don't pay for themselves in the first 30 days or at least solve some sort of other problem that makes me money in the first 30 days, I cut them loose.

The odd thing I have found with my Chilean employees that stay and perform well is that they now don't tolerate any new employees that also don't perform. They run them out for me. They are harder on new guys than I am. I am at least slightly understanding that it takes time for people to get the swing of things sometimes. My girls in the office will be telling me to fire them in about week because they are not pulling their weight.

There are good Chilean workers out there. The number one thing I have found with our Chilean employees is that to be loyal they want a sense of belonging or family. The team management style like they use in the States does not work. Team members are interchangeable parts, family members are not. People let their team down in Chile, but they won't let their family down. Create a family environment, to get a family level of loyalty out of employees.

This is for people that do not have a multimillion dollar marketing department to study the market trends for them and conduct surveys. Throwing money at an idea does not guarantee success in Chile. In Chile even the biggest international companies get their a*s handed to them. It is because they misread the Chilean market and culture.

Tom beat me to it. I just had the longer version.