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View Full Version : Wanting to move to Tenerife, help needed with business plan



deanandjanine
19-09-2012, 13:14
First of all hello to everybody, we have just created an account on here :)

My fiancée (Janine) and myself (Dean) are thinking of moving to your wonderful Island. We holiday there every year and just love the climate, people and way of life.

We run an online t-shirt printing business here in the UK, the business is currently part-time as we work this around our full-time jobs, both working as graphic designers. The online business has a decent turnover for the hours that we put in but we would eventually like to run our own shop, and we would like to do this in Tenerife. Additionally, because of our 30+ years of design studio experience, we would also be able to offer a graphic design service to local bars, restaurants for menus, flyers etc.

As Tenerife is a 12 month a year tourist destination it would suit our t-shirt side of the business perfectly. The business and ourselves are debt free so it would be a nice fresh start for us in a foreign country. We are ashamed to say that we speak no Spanish, but if we decide to go for it we will be enrolling in lessons ASAP here in the UK in the lead up to us moving over.

Last time we were there (February) we checked out a few shopping areas and we would be hoping to open up a shop in PDLA based around Veronica's or San Eugenio area as this would be perfect for our target market.

We have read up on buying a lease and are in the process of writing a business plan to see if it would be worth our time coming over and making a go of it. We would be selling our house and using the equity and our savings to buy a lease for 5 years and we would have enough money left over to pay the business rent for a year and the rent on an apartment for a year to start us off, unless we could find a business to rent that had an apartment above it which would be much easier :)

We would like a little help from you guys if any of you would be so kind? We have made a list of the things we think would be our outgoings but are unsure of their monthly costs?

Is this list of outgoings along the right tracks, and would you be so kind as to give us rough figures per month for the outgoings? I know it is a lot to ask but it would help us greatly. Plus if there is anything we have missed off could you maybe add these to the list?

Monthly Outgoings

Business Rent - 400-700?
Business Water -
Business Electric -
Business Waste -
Business Internet -
Business Phone -
Business Rates (does this apply to small/new businesses?) -
Business Insurance -

Apartment Rent - 400-700?
Apartment Water -
Apartment Electric -
Apartment Waste -
Apartment Maintenance?? -
Mobile Phone -
Apartment Insurance -

Health Insurance for a couple in their 30's -
Monthly Groceries?? -


We are also keen to know your views on the current economic climate over there, is now the time?

Thank you for your time in reading this rather long (and possibly boring :lol:) introduction/request. Any help is much appreciated.

Dean & Janine.

TenerifeTeddy
19-09-2012, 14:48
First of all hello to everybody, we have just created an account on here :)

My fiancée (Janine) and myself (Dean) are thinking of moving to your wonderful Island. We holiday there every year and just love the climate, people and way of life.

We run an online t-shirt printing business here in the UK, the business is currently part-time as we work this around our full-time jobs, both working as graphic designers. The online business has a decent turnover for the hours that we put in but we would eventually like to run our own shop, and we would like to do this in Tenerife. Additionally, because of our 30+ years of design studio experience, we would also be able to offer a graphic design service to local bars, restaurants for menus, flyers etc.

As Tenerife is a 12 month a year tourist destination it would suit our t-shirt side of the business perfectly. The business and ourselves are debt free so it would be a nice fresh start for us in a foreign country. We are ashamed to say that we speak no Spanish, but if we decide to go for it we will be enrolling in lessons ASAP here in the UK in the lead up to us moving over.

Last time we were there (February) we checked out a few shopping areas and we would be hoping to open up a shop in PDLA based around Veronica's or San Eugenio area as this would be perfect for our target market.

We have read up on buying a lease and are in the process of writing a business plan to see if it would be worth our time coming over and making a go of it. We would be selling our house and using the equity and our savings to buy a lease for 5 years and we would have enough money left over to pay the business rent for a year and the rent on an apartment for a year to start us off, unless we could find a business to rent that had an apartment above it which would be much easier :)

We would like a little help from you guys if any of you would be so kind? We have made a list of the things we think would be our outgoings but are unsure of their monthly costs?

Is this list of outgoings along the right tracks, and would you be so kind as to give us rough figures per month for the outgoings? I know it is a lot to ask but it would help us greatly. Plus if there is anything we have missed off could you maybe add these to the list?

Monthly Outgoings

Business Rent - 400-700?
Business Water -
Business Electric -
Business Waste -
Business Internet -
Business Phone -
Business Rates (does this apply to small/new businesses?) -
Business Insurance -

Apartment Rent - 400-700?
Apartment Water -
Apartment Electric -
Apartment Waste -
Apartment Maintenance?? -
Mobile Phone -
Apartment Insurance -

Health Insurance for a couple in their 30's -
Monthly Groceries?? -


We are also keen to know your views on the current economic climate over there, is now the time?

Thank you for your time in reading this rather long (and possibly boring :lol:) introduction/request. Any help is much appreciated.

Dean & Janine.

Hi Dean & Janine and welcome to the forum :)

There is a lot of useful information on the forum that you can find by using our search facilty, but I will try and fill in some blanks for you, as my wife & I (how posh) run a couple of legal business here.

The first thing I would say is that I think your business rent suggestion is too low for that area, though I don't know for certain, even in my village a 50 sqm local can be from 600-1800per month depending on location (and greed of landlord).

Monthly Outgoings

Business Rent - €1000 pcm
Business Water - may be inc the rent or if separate poss €30 pcm
Business Electric - depends on equipment you run - for me €120-150 pcm
Business Waste - €160 twice a year
Business Internet - €50 line and internet - deals available
Business Phone - (set up voip and landline calls are cheap - I can help here
Business Rates (does this apply to small/new businesses?) - not if you are renting
Business Insurance - €350 ish per year

Apartment Rent - depending on area and what you want if not sharing €500 +
Apartment Water - €20 pcm
Apartment Electric - €80-100 pcm
Apartment Waste - €45 twice per year
Apartment Maintenance?? - Community charge - ours is €65 per month
Mobile Phone - €10 per month +
Apartment Insurance - €300 per year

Health Insurance for a couple in their 30's - If autonomo (self employed) you are covered but approx €270 per month each if both working. (legally cant opt out)
Monthly Groceries?? - €400 ish or way more , depending on how much you use local produce/ shops or Iceland.

There will be many people tell you many different costs, it largely depends how you live.

The business climate is very tough and unemployment at an all time high. However the right business in the right place can work, just think it through and plan it very carefully.

Good luck in whatever you decide to do :)

deanandjanine
20-09-2012, 11:31
Hi TenerifeTeddy,

Thank you very kindly for your reply :)

That is the exact sort of information we were after. I can see it is pretty clear that we have wildly underestimated the monthly business rent. We just took an average monthly rental on some of the small business premises we have looked at on various estate agents' websites. But, as you mention, there will be fluctuations depending on the area. The business rentals we have looked at online were not in our target area so we need to up our figures massively for that area.

Thank you for you help, we shall have a dive in to the forums and read up as much as we can.

Kind regards,

Dean and Janine.

TenerifeTeddy
20-09-2012, 12:08
You're welcome :) Send a PM to Young Golfer, who deals with property sales and rentals. he is widely respected on here, and he will have a much better idea of current rental prices and availability in the area you are interested in as he is based in Las Carabellas, not far from Vernoicas etc.

Another thing to consider is the cost of the Proyecto (project) and Opening Licence for starting up a new business. We just started a small school last November and the costs were about €3500 for the electrical and building work required & electrical boletin & plans, for submission to the Ayuntiamento (town hall) plus €700 for the actual Opening Licence. Though recently the rules were relaxed for some businesses in premises of less that 100sqm.

Medanoman
11-10-2012, 13:32
The first thing I would say is that I think your business rent suggestion is too low for that area, though I don't know for certain, even in my village a 50 sqm local can be from 600-1800per month depending on location (and greed of landlord).

yes i had a Shop on the seafront selling ecological ( San etiene) cotton clothes for years until the downturn got us. The rent was a killer 3000 euros a month and landlord would not budge... After 5 years it was no longer possible to continue paying the rent and we had to close.

Buying a lease or traspaso , and paying key money for the privilege is also not nice. If the shop is in a sought after location you will pay a fortune.. 8 years ago we paid 80 grand to get a seafront property that 6 years later we could only sell on for 20 and we were thankful for that. You might be lucky to come in at just the right time to get a bargain. But its very hard just now.

Balcony
11-10-2012, 16:52
I would suggest that in your BP you add a contingency to break any lease and to get you home if it all started to go pear-shaped. And put that money aside.

Find yourself a half-decent lawyer for advice and a good accountant to save you tax etc.

Medanoman
11-10-2012, 18:23
I would also make sure that you are not liable for all of the property maintenance while under you are under lease. The Electrical regulations seem to change every 3 years meaning that to stay open your shop has to have its electrical installation certified as ok to be able to open. Land lords can famously do nothing. You end up having to maintain the shop in a state that keeps it open and not the owner.

YOUNG GOLFER
11-10-2012, 19:32
Hi I have a good locale in a good area 500€ a month don't go down the road of a lease there is no need it's dead money and you really don't need to pay this.......... more so when there are good few around.
I know of locales in my area that are bigger than mine facing the sea and only 600€ a month just a months deposit is needed.
You want to be very careful don't dive in.