By Mike Jones

My business partner and I are often asked how we decided to start a bookstore in Costa Rica. We began by listing all the businesses we thought might be interesting to operate and/or potentially profitable. The list we came up with included a pool hall, music store, bar, pharmacy, bagel shop, bookstore and laundromat. As we were mulling over the possibilities, we heard about a bar that was for sale. After talking to the owners of the bar and consulting with our lawyer, we decided to make an offer, contingent upon our being able to discuss with the building’s landlord the changes we wanted to make to the bar. When the owners of the bar told us that it wouldn’t be possible to talk to their landlord prior to purchase, we balked at the deal, sensing bad faith. A few weeks later, some friends contacted us about an excellent retail location that was becoming available in downtown San José. Because the location is near to the Plaza de la Cultura, a point visited by nearly every tourist, we decided that an English language bookstore, whose main market would be tourists, might work. And so, within the space of two weeks we went from being bar ownwers to bookstore owners.

Our bookstore has now been opened nearly four years, and each year sales have nudged upward. There have been moments of despair, frustration and crisis, but the business appears to have finally left the crawling stage behind and is walking. I never owned a business before in the U.S. and do not think that only four years of business ownership prepares me to give general business advice. What I could instead offer is a handful of tips that relate specifically to expatriate business ownership.

The first relates to your decision about opening a business in Costa Rica. You must decide if you like the country! This is an obvious point, but I have seen many tourists arrive and decide to move here mainly on the basis of having enjoyed their vacation. The rythm of day-to-day existence versus that of tourist life is entirely distinct. If you can pull it off financially, I would recommend first arriving for a six month visit to really test the idea that this is where you would like to live. Even then, you must keep in mind that there is a big difference between living here while not working and living here while running a business; all the things you enjoyed doing when you were free of work obligations, you will find little time for when you are starting up a business.

When you do decide to start a business, be prepared for a dual challenge, you will be facing all the standard problems of business ownership (managing cash, monitoring competition, attempting to increase sales, etc.) at the same time that you are learning a new culture and language.

As you go through the process of trying to decide what kind of business to open, it is common to make a list of kinds of businesses that exist in the home country but do not exist in Costa Rica. For several years we expatriates were clamoring for a bagelry and a micro brewery, and when they did finally arrive they met with considerable success. Nevertheless, it is important to keep in mind the significant cultural differences that exist between the home country and here, and that what works there won’t always work here. The expatriate community is not so large that you can succeed simply by targeting that group. You need tico customers too, and disposable income is not too high here. Also, whatever business you choose, it is obviously important as an expatriate to respect the customs and moral standards of this country. One gentleman from Canada entered the store and told me he was planning on opening a topless car wash. I said, “I would suggest doing that in another country.”

Expatriate business people need to resist the occasional pull toward paranoia, toward the notion that “they”, the locals are all trying to take advantage of me. A more reasonable stance, I think, is to asume that in business everyone is trying to take advantage of everyone, regardless of national origin. So far, our only slightly significant encounters with less than honorable people have been two unfortunate business deals with other expatriate business people, who , because they had no strong family or financial ties to this country, were able to flee the country.

Despite a strong tendency on the part of U.S. media to represent Latin American governments as bureaucratic, inefficient mazes, we have found the opposite to be true in Costa Rica. Nearly all the legal and regulatory issues that we have been required to comply with have generally been handled swiftly and fairly inexpensively by our lawyer. Get a good lawyer whose practice focuses on expatriate clients. A related stereotype about Latin America is that it is rife with corruption. While there are great differences between countries, we have never had anyone approach us and insist that we pay a bribe as a condition for conducting business. True, we have had people offer us the option of a bribe in order to receive faster or better service. I’ve seen similar things happen in New York. A last word of advice...don’t expect to get rich.