Buying a business in Pattaya? Check the deal first.
I've bought most of my seven businesses rather than starting them. Tell me about the one you're looking at and I'll check it against the rules I use myself: the price, the numbers, the lease, the company, the staff and how you pay.
By Shane RuddleOwner of 7 Pattaya businesses · 20 years hereWhat kind of business is it?
How long has it been trading?
What numbers have you seen?
Why is the owner selling?
What exactly is for sale?
Have you met the landlord?
Who are the customers?
Is the landlord asking for key money?
What about the staff?
How would you pay?
Tell me about the deal.
Add the asking price and the profit to see what I'd pay.
Send me the listing and I'll tell you what I'd ask.
My honest opinion from buying businesses here, not legal or financial advice. Get a Thai lawyer to check the company and the paperwork before you sign.
Send me the listing and I'll tell you what I'd ask
Paste the link to the listing, or describe the business: where it is, the price and what's worrying you. I'll reply personally.
How I buy a business in Pattaya, in four steps
The rules behind the deal checker, from my buying series.
- It takes about three years to build a core of regulars. When you buy, you're buying those three years.
- A business that's trading has already answered the biggest question: is there a market?
- If the owner was the face of the place, some regulars will drift off. Most come back within months, out of habit.
- A typical restaurant and bar makes about 10% on turnover; a really good one 15 to 20%. Much more than that, ask why.
- I pay two to four times annual profit: closer to two for a newer business, four for one with years behind it.
- Why they're selling matters as much as the numbers. A seller staying in Pattaya won't risk their reputation.
- Three-plus-three leases are the norm. If it's traded in one spot for years, I worry about the landlord more than the years left.
- Always meet the landlord. Never pay key money: negotiate it into the monthly rent.
- Take over the existing company. You inherit staff service and severance, so find out how long everyone has been there.
- Hold back at least 10% of the price, paid a few months later.
- Change nothing for the first three or four months. Work out who does what, and why.
- The biggest mistake I see: going in like a bull in a china shop to put your stamp on it.
The businesses on Facebook or with agents usually aren't the best ones. The best sell quietly, by word of mouth between owners. Of the last five or six I bought, other business people hadn't even known they were for sale.
Walking Street, go-go bars and nightclubs. The risk is very high and you can be at the mercy of the authorities. And a bar bought as a retirement hobby: it can work, but the odds are against you.
Start with the reality check
If you haven't found a business yet, six questions tell you whether your budget, experience and plans give you a fair chance, and what it costs to get going.
Check my ideaThe basics, including foreign ownership and work permits: starting or buying a business in Pattaya.
Buying a business: short answers
How much should I pay for a business in Pattaya?
I work on two to four times annual profit. Closer to two for a business with a short track record, closer to four for one that's been trading for many years.
MoreHow much profit does a restaurant and bar in Pattaya make?
As a rough guide, about 10% of turnover for a typical one, and 15 to 20% for a really good one. If the accounts show much more, ask why.
MoreShould I pay key money for a business lease in Pattaya?
I never have. I'll pay a reasonable deposit, but I negotiate to add the equivalent of the key money to the monthly rent instead.
MoreShould I take over the seller's company or start a new one?
I've always taken over the existing company. You take on its liabilities, especially long-serving staff and their severance, so check those before you agree a price.
MoreShould I pay the full price when I buy a business?
No. I always hold back at least 10%, paid a few months later. It keeps the seller involved in the handover and gives you leverage if problems come up.
MoreWhere do I find good businesses for sale in Pattaya?
Usually not on Facebook or through agents. The best ones sell quietly, by word of mouth between business owners. Get to know other owners.
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