Updated: Jun 1, 2020
Networks in Indonesia are vital if you want your business to run smoothly. Networks come in many forms and each different one provides another key in achieving success in this sometimes confusing landscape. As a foreigner, and this comes from personal experience, creating networks can be a hard and gruelling task. As a foreigner the main networks you can utilise are: other expat business owners, local business owners, a mixture of local and expat networking groups and of course your staff. Each one provides advantages and disadvantages which can help or hinder your business journey in Indonesia. The next few blog posts will look at each one individually and I will share some personal experiences with you so you can get an insiders perspective on how they operate.This week we will look at the first group - Expat business owners.
Expatriates, aka “expats”, are a group of people who have moved from their native country to live in another culture, region or country and setup life. This could be a business move, a lifestyle move or many other reasons. Once you decide to move and set up business and life in a new country you too also join this special group of people and now become an expat. Expats are an interesting bunch of people. Without stereotyping too much, expats tend to move to an area where they have traveled to previously many times before or perhaps know someone already living there and they too wish to set up their life there. When an expat moves to a country like Indonesia, Bali in particular, they are usually wanting the holiday lifestyle everyday and usually this is a reality. As long as you have enough money to maintain it - it can be a great move. Expat communities tend to have all the modern conveniences that you associate with Western lifestyles. Cafes, bars, restaurants, salons, alcohol etc...
Expats can be both welcoming and unwelcoming. You can get to a point when over population or over saturation of a certain area starts to create tensions within the expat community which can lead to jealousy, arguments, sabotage, violence and a whole lot of bad things. However this doesn’t mean that all expats are bad and there are many people in the expat community are willing to help you transition into your new life as they too know the challenges you’re going to face. However more often than not you are told about the negative experiences caused by expats.
For example: When I lived in Bali the first time i moved to North Legian - just near the Jayakarta hotel and lived above my bar in a small hotel. In my street there were approximately 6 other restaurants and bars that were already established, had a reputation and had a good flow of returning customers. All the bars and restaurants in that street were owned or part owned by expats. When I moved in i thought this is great. I would be able to capitalise on working with the other expats and they will be able to help my business gain a reputation.
As you have probably guessed, that didn’t happen at all. What I was faced with was constant abuse, unneeded jealousy, threats and people who were just plain mean. I was shocked to say the least. I couldn’t understand why I was not being welcomed with open arms in my new community. Perhaps that was due to my naive understanding of what being an expat is, or maybe I was just over excited to be a new business owner and living my dreams. This was before social media existed in its current form and used as a way to create a reputation. When I had my bar you would have to rely on online forums, referrals from other travellers and friends, as well as help from other businesses or the just plain luck of people walking past, walking in and enjoying their experience and coming back time and time again.
Over time I finally realised what the issue was. The street I was in serviced 3 hotels with 2 of them being quite large - but the large hotels had bars and restaurants inside them as well as bars and restaurants on the other side - which was next to the beach and provided a sunset view. I soon realised was there was only so many customers to go around and if the same customers came into my restaurant and bar that means they would not be going into their business. In reality I was taking away their potential profit. What confused me was that my business had already been open and operating for 12 months, so why is this an issue now. I asked the previous owner and he said he too faced the anger, threats, abuse that I was facing from the expat business owners as he was taking their customers away from them.
This was the mentality of the local expats - there is only so many customers available, we must do whatever we can to make sure we get them. So a new business opening up in their street was a threat to them and was potentially taking away their livelihoods.
This doesn’t mean that all expats are bad and unwelcoming. Quite the contrary. I also had experience from other expats that was helpful and understanding of my struggle as a new business owner in a foreign environment. They helped my business and would recommend my business to people who visited their bars and restaurants. Actually they have become very good friends of mine - oh and check out their bar and restaurant The Orchard Bar & Restaurant located in Seminyak (just follow the link).
When I met these nice expats I couldn’t help but think are they only helping me because I was not in their immediate business area and was not a threat to their business. Would it be different if i was the business next door to them? As time progressed I saw that these people were genuinely happy to help everyone. They saw and understood that tourists do not go to the same place night after night. They in fact want to try other venues. They saw and understood that we were all in the game together and the game worked better if you helped each other out. The recommendations go both ways which helps everyone.
Looking back I understand the fear from the “bad expats”. As Bali is a seasonal destination, you only have a limited time to make you money before the tourists disappear and you’re back to the quiet season. As the saying goes - you need to make hay while the sun shines - so when ever someone comes along to steal your hay - it can make the low season difficult. I wonder how many new customers we all missed out on by not helping each other and creating a community feel. The potential is only limited by what people are willing to do and at that time the people in my street were not will to do anything.
This is an experience from 2006. It is now 2019 and I wonder what the expat community is like now. I still have friends who have businesses in the popular areas of Canggu and Seminyak and they tell me that sometimes it can be worse and sometimes it can be great. The biggest issue currently being experienced is over saturated areas that have too many of the same thing. Eg: Canggu and Seminyak now have an over abundance of restaurants and bars offering the same experience. This coupled with lower than expected visitors (the reality is Bali in particular has an increasing tourist trade but now a lot of the tourists, Chinese especially, are on organised trips and tend not to venture outside their itinerary, or they are visiting other areas of Bali which weren’t visited previously). This coupled with environmental problems like Mt Agung eruptions or the Lombok earthquake, you are getting rising tensions between business owners who are all trying to attract the limited tourists numbers.
It's true there are many problems associated with expats and living in expat communities however these problems can be mitigated if expat communities can start working together. Indonesia is a collective culture where everyone helps everyone in their community and it is vital for any expat to understand this. If you are an expat I strongly suggest that you get to know your other expat and local business operators in your immediate area. Become friendly and work together. Your community will be a lot stronger and your business will be able to handle the bad times when they come. If you are thinking of becoming an expat I suggest you get to know the business owners in the area where you want to open your business BEFORE you open your business. This will simple exercise will allow you to learn many things about the area. If you are investing $250,000 in a business and moving your life to Bali or any other expat area in South East Asia, do your homework first and create your expat network BEFORE you move.
Networking and networks are extremely important for business in Indonesia as it will give you the contacts you will need and allow you to solve a lot problems and challenges before they even arise. The experiences above are just a small insight in to what can happen and are by no means the experiences of all expats. Just remember that when you are moving to a new country there will be a lot of challenges along the way. The best way to avoid the problems is to create your network before you go. Once you have found your network invest in it, develop it and grow it. Oh and when a new expat comes to you for advice - think about how you were when you first arrived and the help you needed.