Many foreigners are tempted to set up businesses in Spain. Lots find success, but every year there’s also a long list of those who didn’t quite make it.
In this article, we look at what’s behind successful businesses in Spain and offer tips to help make your venture work.
Do your research
Research is key to a business’ success wherever it’s based and Spain is no exception.
Spend as much time as possible getting the facts on:
Location – where’s the best place to set up your business within your chosen place to live in Spain?
Competition – what’s the local competition and how are you different? Even if you’re offering more of the same, you need a differentiating aspect to make people choose your business over local competitors
Market – is there a market for your business? If there is, how big is it and is it big enough?
Bottom line? Decide what you can offer and make it better, cheaper or completely different.
Get advice and support
Don’t go it alone. Before you take formal steps to set up your business in Spain, get as much help and advice as you possibly can. Lots of organisations and associations offer support, often for free. Read more about setting up a business in Spain.
No businesses in Spain are successful overnight. The timescale to build a business that works is actually much longer.
Allow at least two to three years for your business concern to find a footing and establish itself.
That said, don’t just sit back and wait for it to happen; draw up a business plan and follow it through. Tweak the steps as you go if necessary.
Have a plan B
The harsh reality of businesses in Spain is that many don’t work.
You might make the best possible go of it, but circumstances beyond your control may mean you have accept that your business is a failure.
Think about a plan B and be prepared to put it in place.
Do you simply close the business or try a new tack?
And make sure you’ve got sufficient funds to last while your business gets off the ground.
Best businesses in Spain by type
Not all types of businesses in Spain will work. Cultural considerations mean that Spain may not be suitable for certain kinds of businesses. There are, however, enterprises that thrive in Spain.
Bars and restaurants
The Spanish love to eat and drink out and some of the most successful businesses in Spain cater for this passion. That means, however, that if you decide to open a bar or restaurant-type business, you’ll have a lot of competition.
Look out for – paperwork including permits is complex for the restaurant business and you and/or your staff may need to obtain a food handler’s certificate.
Do the research – check out the competition, its size, offerings and prices. Find out who goes there and how often.
Providing some sort of accommodation in Spain is a popular business option. Whether this is offering rooms to rent in your home via a system like Airbnb, turning a property into a self-catering holiday rental or opening a hotel or hostel, the boom in Spanish tourism lends itself to lots of potential.
Look out for – rental regulations vary hugely from region to region in Spain. Check these as your first step because there’s no point making plans only to discover that holiday rentals aren’t permitted.
Do the research – look at tourism statistics for an area and the seasonality. Check out the competition and their rates.
The recent recovery of the Spanish property market has brought with it a flood of new estate agents. Commission on sales comes in at 5% of the purchase price so this can be lucrative business. On the other hand, strong competition and an often cut-throat market means that only the best stay around for more than a year.
Look out for – estate agents must be qualified and registered in Spain. Don’t start doing business until you have all your paperwork in order.
Do the research – find out who else is selling property in your area and decide how you can do it differently. Do you target a different nationality? Sell a niche-type property? Offer a property finder service?
Whatever the services you offer – translation, marketing, IT, property management, car repair, plumbing, home renovations, care of the elderly… - there’s a market for it in Spain.
Make sure your qualifications are valid in Spain and find out if you need to do extra training before you can open a business concern.
Look out for – catering only for expats and overlooking the Spanish market. This is much bigger and more stable. You will, however, need a good grasp of Spanish.
Do the research – find out what people need in your chosen location and see if your business can make up the shortfall. If they don’t need it because there’s already plenty of it, work out how your business can offer a better option.