The DR is the place for entrepreneurs

Chip

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Jul 25, 2007
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After dealing with various professionals in the construction industry here I have come to the conclusion that generally speaking, the services offered here are generally overpriced and inferior compared to Western standards and the providers will be typically replete with excuses as to missing deadlines and poor performance. I therefore understand then how so many foreigners come to the DR and do quite well, as they understand real work ethic, accountability and the true meaning of customer service. What this means to me is that I can do work down here in the DR and be competitive when before I wasn't sure it was possible. For others so inclined all it takes is somewhat of a specialized skill and/or market sense and some capital and you can be off and running.
 
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Chip

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Jul 25, 2007
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Understanding how Dominicans generally run businesses for example is essential in creating a business plan that will work.

The Dominican model is not a free market model in that they sell their wares/services to all at the same prices and the said prices they charge are what would be considered normal for what the market would bear. Rather, because there is typically less demand and an abundance of suppliers, Dominicans will set prices of services and goods based on an assessment of the propective clients ability to pay and their assumption of the resources of the prospective client to find the equivalent service. What happens then is that because this is the common model used throughout the island it may be very difficult to get actual reasonable prices for services/goods without having to do extensive research and negotiating.

Understanding this can help the foreigner to have in advantage assuming that they can create a business plan perhaps based less on said aggresive principles and more on free market demand to set prices. This should allow one to have a higher volume of work assuming that the level of service/product is comparable or better. I believe in fact that many foreigners have come to the DR over the years and been very successful. Unfortunately, as soon as their children take over the companies soon lose the "free market" approach to running the business and revert to the more aggresive principles. Still this feature of Dominican business should be an advantage to some who come here looking to start a business.
 

Berzin

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Nov 17, 2004
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Chip-since you are basing your observations and experience on the construction business, how does the work ethic and standard differ from the site managers to the laborers?

Are the examples of shoddy workmanship you've seen a reflection of an unskilled/unmotivated manual labor crew, a result of poor supervision and training or both?
 

Chip

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Jul 25, 2007
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Are the examples of shoddy workmanship you've seen a reflection of an unskilled/unmotivated manual labor crew, a result of poor supervision and training or both?

All of the above - of course compared to similar in more advanced countries. Relatively speaking, lower expectations of quality and performance coupled with less intensive training/education are the root causes.
 

MrMike

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Mar 2, 2003
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I thought the same thing when I founded my first 2 DR businesses, that all Dominican businesses were begging for competition, things could be done so much better, etc.

Now that I have a few failures under my belt from "showing the stupid locals how its done" I have become more aware that there is a reason for everything.

It's not that all of these contractors and vendors are doing things the right way, clearly they are not. But they are a product of their environment and have a clear reason why they do things the way they do.

One of the main issues is instability. Whether its supply lines for inventory, electrical outages, difficulty in getting basic services to work, changes in government that make life easier or harder, volatile attitudes in the workforce, changes in taxation or tax collection policy, the health of the economy, etc. All of these things over time have taught Dominican business people to be short sighted and "get it while the getting's good".

They cant afford to have reasonable profit margins because they can't be sure they'll ever be able to re-order inventory.

They cant afford not to take everything they can from every single customer because they don't know if they'll ever have another one.

I, of course, remain committed to fairly compensating workers, not overcharging customers and delivering what I promise, but I am aware that this in itself is for my own satisfaction and peace of mind, not necessarily a recipe for success.
 

Chip

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Jul 25, 2007
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I, of course, remain committed to fairly compensating workers, not overcharging customers and delivering what I promise, but I am aware that this in itself is for my own satisfaction and peace of mind, not necessarily a recipe for success.

Would you say that you personally have not been successful? From a longevity and adaptability point of view to me you seem to have been doing pretty good.

As far as "showing the stupid locals how it's done", my point isn't to demean the locals for the situation that they're in as much as to recognize that in certain areas with so much "fat" available it makes potential business prospects attractive. What I mean as "fat" is generally poor quality of service standards compared to similar expectations say in the US and billed at higher actual rates. For the foreigner who is more accustomed to the higher level of services expected at even more economical rates it should seem that they would have an advantage.

What I have seen among many wealthy Dominicans as soon as their are successful as they invest in their personal fortune as opposed to investing in the businesses. They then become accustomed to such a high standard of living (expensive home, cars, jewelry, clothes) that they are no longer interested in doing a good job as much as they are lining their pockets. Yet, since they already have their market share and credibility they are less and less concerned about competitiveness and the evolution of their product and services.
 

MrMike

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Mar 2, 2003
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Would you say that you personally have not been successful? From a longevity and adaptability point of view to me you seem to have been doing pretty good.

Well its only been for the last 3 years or so that I would consider myself "successful". Success in this case means not having to worry about breaking the bank to buy food and pampers. I don't know if thats enough time to declare victory. It's been alot of ups and downs. I nearly threw in the towel in December, things are looking better now, I guess we'll see.

As far as "showing the stupid locals how it's done", my point isn't to demean the locals for the situation that they're in

Sorry, didn't mean to imply that you were, I was referring to my own (former) attitude, not yours.
 

bob saunders

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Jan 1, 2002
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Even in the dr, Attention to detail, quality and priced right make a difference. My wife has hired many people to do work and those that do good work at the right price get repeat work, those that don't, never again.
 

ExtremeR

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Mar 22, 2006
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Understanding how Dominicans generally run businesses for example is essential in creating a business plan that will work.

The Dominican model is not a free market model in that they sell their wares/services to all at the same prices and the said prices they charge are what would be considered normal for what the market would bear. Rather, because there is typically less demand and an abundance of suppliers, Dominicans will set prices of services and goods based on an assessment of the propective clients ability to pay and their assumption of the resources of the prospective client to find the equivalent service. What happens then is that because this is the common model used throughout the island it may be very difficult to get actual reasonable prices for services/goods without having to do extensive research and negotiating.

Understanding this can help the foreigner to have in advantage assuming that they can create a business plan perhaps based less on said aggresive principles and more on free market demand to set prices. This should allow one to have a higher volume of work assuming that the level of service/product is comparable or better. I believe in fact that many foreigners have come to the DR over the years and been very successful. Unfortunately, as soon as their children take over the companies soon lose the "free market" approach to running the business and revert to the more aggresive principles. Still this feature of Dominican business should be an advantage to some who come here looking to start a business.

Excellent post Chip, agree 100% with you. The biggest example of this are Chinese expresos or picapollos. Compare them to Picapollo Victorina and you will see the difference ($500 for 15 chicken tenders in Victorina, $150 for the same amount in a Chinese expreso). Those business grow so much in 3 or 4 years that by that time frame the Chinese owners are moderately rich, hanging out in Lexus Jeepetas and moving to high scale areas.

I think a good start would be to improve the customer services approach of actual business nowadays.
 

J D Sauser

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Nov 20, 2004
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The first impression, when visiting countries like this one, obviously always is, that there are soooo many things either missing or done so badly, one could almost do anything.

The truth is, it ain't that simple.

The DR certainly is one of the most difficult working environment around. As mentioned, it's not a true free market environment, locals have several ways to deal with competition which may seem unfair, to put it mildly and because some many things are lacking, unless one finds a business which need no materials, no tools and requires no outsourcing to reliable, capable third party firms... things can quickly seem "cloggy".

I've written several times about this little experience here, but it serves well as a typical example.

A couple of months back, I volunteered to fix a broken wooden living room chair, which to begin with had been made by a local "carpenter" apparently implicitly seeking to defy every and all rules of carpentry and logic.
I glued the broken parts back together, but fearing that because of bad initial workmanship, I decided I need to run two 10" long 1/2" dia. wooden dowels into the planks across the fibers, so to reinforce them.
First bump... NO dowels! None! Not even short ones one would expect being used in carpentry and furniture making every day!
So, I log onto e-bay and bootleg a dozen 3 foot long dowel rods onto the island from some Northern State in the US.
Then, no auger drills.... actually No WOOD drill at all.
Back to e-bay, back to the smuggling biz...
All that, just to try to fix a couple of dern locally "made" living room chairs.

Cost? Do you really want to know?

I have never been so inactive as I am since I moved here... resigned to consulting, giving advise and supervising and controlling trolls working with either no tool, the wrong tools, broken tools or stolen tools and having for most part NO clue.
I talk to engineers which come to me with things like trying to convince me that water runs slower up hill than downhill (hint, water does NOT run uphill... but you go tell them). Architects insisting on roof slopes facing inward to the middle of the home and civil engineers which will NEVER accept the world wide demonstrated advantages of humidity barriers bellow a home's ground floor... never like in NEVER.

You think it looks easy? You try! :D

And yet yes, there is a lot of money being made and to be made here.

... J-D.
 

dv8

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Sep 27, 2006
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i think we all saw on dr1 too many people fail with their DR business. "i am in love with DR and i want to have a small hotel, i will work" and then a year later "i have lost all my money".
one can be successful and make good bucks but there in a need of money, knowledge, contacts etc. i doubt that most of foreigners have that.
 

Chip

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Jul 25, 2007
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Santiago
I don't want to imply that any service or business here in the DR would be a slam dunk, rather that there are certain business opportunities available. From what I have ssen, there is much more "fat" in professional services such as engineering, construction and even retail than say in carpentry or in possibly many tourist businesses.
 

NALs

Economist by Profession
Jan 20, 2003
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Folks, do what many top Dominican entrepreneur do. When experts in business management arrive on the island, attend their seminars and learn a thing or two.

In fact, on the 15 of April at the Hilton in SDQ Tom Davenport will be presenting his "Competing on Analytics". Of course, this is not for small business owners since the reservation costs US$675, but its a heck of an investment for people that don't like to throw darts at a board and want to apply the most up-to-date strategies from first world countries; just like many top Dominican business leaders do.

In October of last year Eduardo Moane Drago, who is the main investor of the Cambridge International Consulting gave a very successful seminar on getting excellent results through your employees. On the 17 of this April Murray B. Low, a profesor from Columbia University will be in Santo Domingo giving a seminar on strategies of innovations and competitivity in times of crisis. Not too long ago Ken Blanchard was also in the DR concerning effective leadership.

But, these are geared towards big Dominican business men. You know, those with masters and doctorates from top universities in the DR, US, and Europe and now run the largest companies there based on modern First World business theories. Plus, you have to be willing to travel to SD because that's where these types of information sharing occurs.

-NALs
 

NALs

Economist by Profession
Jan 20, 2003
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i think we all saw on dr1 too many people fail with their DR business. "i am in love with DR and i want to have a small hotel, i will work" and then a year later "i have lost all my money".
one can be successful and make good bucks but there in a need of money, knowledge, contacts etc. i doubt that most of foreigners have that.
Insuficient capitalization is the number one reason behind business failures anywhere in the world. There are people that go into business without a back up plan. They simply leave everything to "luck" and then they find themselves in ruin.

Make plan A, then plan B, and then plan C; and then throw yourself into the race.

-NALs
 

mike l

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Sep 4, 2007
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All of that is true.

On the main road in Sosua across from the Playero the Appliance store closed but a Pico Pollo just opened next to where they were????

I could understand why the Appliance store failed ( I bought 2 refridgerators there),
but can't imagine the chicken joint lasting long.

To go a bit further , how can that Chinese, take out place in Sousa last,?

Then there are all the rest!

I always like to leave on a positive note so I will recommend the NEW Motorcycle Detailer in Sosua.

In front of Lou's Shark bar there is street vendor that fries up something the locals eat, and he has a pressure washer and an apprentice that will sand blast your bike until you tell him to adjust the nozzel.

Of course my bike never started because of the 2000 gpm but with a chamois and a half hour of waiting I had time to have my shoes shined.

I would not last one minute in Santo Domingo!
 
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jrhartley

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Sep 10, 2008
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people often seem to fall at the first hurdle - and somehow forget to advertise - they just expect people to turn up and give them money for whatevers on offer .Often you have no idea a business exists until someone mentions it in passing
 
Mar 2, 2008
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"I would not last one minute in Santo Domingo!"
Mike I

LOL!@!

Sometimes I think I would not last a NY minute in Puerto Plata.

But, it's all good.
 

dv8

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Sep 27, 2006
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is it just me?

if we talk about those big fish guys NALs mentioned - they might have started low but they are not your average dominicans who get a jeepeta as soon as they earn their first million (pesos). those are guys who will drive old beaten up truck and live in a small house re-investing profits back into business. and now they have helicopters and yachts. now, not when they started.
good business bringing american size profits requires either a fantastic idea (i presume that would be dr1 :cheeky:) or large financial investment. always.
 

jrhartley

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Sep 10, 2008
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an indoor bowling alley in sosua - make money when it rains- air conditioned make money when its too hot outside