Post Number: 875
|Posted on Saturday, November 25, 2006 - 5:54 pm: |
Keith had a great idea. Whether you started from scratch or transplanted to Argentina with a plan, money and a set up let us know your story. It doesn't matter if it is in progress, is about to succeed or was put to rest. Over the years I witnessed first-hand a good number of businesses evolving and folding at the beat of political/economical changes. Whatever you want to contribute will help us avoid pitfalls and potential risks...
(Message edited by admin on November 25, 2006)
Post Number: 877
|Posted on Saturday, November 25, 2006 - 6:28 pm: |
The one thing to always take into account when considering a business in Argentina is that things can change *radically* in a dime. A new government, a change in the cabinet, a new tax regulation or similar can throw all your effort and work by the wayside and with very little anticipation. Perhaps, this lack of long-term stability or even lack of vision from authorities is the greatest danger for any business locally. I have heard and experienced horror stories when new taxes were introduced at different levels of commerce (sometimes retailing, other times to tilt the balance between imports/exports) leaving players badly hurt and in the wrong side. A 300% overnight increase in import duties sent my grandfather to a very large bankruptcy in the early 60s. One that was fought in court with over 100 creditors for about 20+ years. In the 80's he experienced a second bankruptcy when inflation spiraled out of control during the Alfonsin era. All the while, a friend of mine was making tons by selling his merchandise cheaper than his cost (illegal) only to raise cash fast for financial gains (he could make more out of interests -really high due to inflation- than by selling items for a profit).
Drastic changes in rates of exchange left relatives in the doldrums only to come back 10 years later as winners, when a new change took place. It is always useful to note that most of us -locals- have found ways of handling such events/changes even if by behaving in a dysfunctional manner -like keeping our savings "under the mattress" as opposed to investing our funds rationally- or requesting 100% cash when selling property.
For foreigners, specially those coming from the 'land of opportunities' where anyone can become rich or President of the nation (or so does the tale goes) this is particularly important as it may mean being blindsided.
Most success stories I am familiar with are from immigrants of the older periods when Argentina was still growing at a considerable pace or at least continuously. Anybody who tried to start a business locally from scracth in recent times, please share.
Post Number: 144
|Posted on Friday, March 02, 2007 - 11:24 am: |
Roberto provides very sound advice in his posts above. Argentina can be a brutal place to do business in. For as beautiful as the city is, the country is completely corrupt (http://www.transparency.org/policy_research/surve ys_indices/cpi/2006) It ranks with most African nations.
As Roberto mentioned, the laws are ever changing here. I own a few companies in South America and 3 in Argentina. All have been successful but it took years of planning and hundreds of thousands of dollars building them up, legal and accounting fees.
No matter what you are going to do in Argentina whether it's selling food or building buildings... you MUST have a good business plan and you must have good and competent lawyers and accountants assisting you. It's not enough to invest money here. You have to understand the laws. It also helps to have good contacts here via consultants that have good contacts including executives or politicians here.
I've seen a lot of foreigners come to Argentina in the past 4 years trying to do business here but most of them have folded up within 2 years and went back home. It's an incredibly difficult place to make money and do business in.
The tax structure is incredibly complicated and it is expensive when you are doing everything in the "white" legally.
So, in short. Have a rock solid business plan (and follow it), have good attorneys, good accountants, good consultants and good banking contacts.
Best of luck to all.
Post Number: 1544
|Posted on Sunday, February 24, 2008 - 9:34 pm: |
Arial, I am moving your inquiry to the Mar del Plata thread.