Many people relocate to Spain with the idea of retiring in the warm sun in the beautiful Mediterranean environment, but after a few weeks and months, some find that their lives are just too quiet without the buzz and challenge of employment. To give themselves a purpose once again, they decide to start their own business in the new sunnier clime, but being in a foreign country with different rules and regulations means that the processes of forming a start-up business may not be quite as simple as at first thought. So in order to point you in the right direction, this brief article has been crafted to go over the basics of what you need to know in order to start a new business venture here in Spain .
No matter what country you find yourself in, if you are looking to start up your own business there are certain things you must already know.
For example you must have a solid business plan; you need to have done enough market research to establish that there is a demand for the products and that your proposed business is viable; in an ideal world you should have some sort of experience and previous knowledge of the market you intend to enter; and if, as in Spain, the local language is other than English, you or one of your close associates must be fluent in the local language. In Spain for example, if you were to be based in or near Valencia , that would mean learning Valencianan, which is a little different from classical Spanish.
The types of businesses in Spain are similar to those in England but there are some differences; however for the purposes of this article, the most common types of business that an expat will be looking to start will be either:
No matter where, or what type of business you hope to start, you must have a comprehensive business plan, and bearing in mind that you may need to borrow money, your business plan should be written in Spanish as well as English. If you have never compiled a business plan before, then you may need to seek local assistance. The Cámaras de Comercio is the Spanish equivalent of the Chamber of Commerce, and if you seek out your local office they will be able to offer you some advice regarding how to compile a professional business plan.
Any business must of course be suitably funded, so your next consideration has to be whether or not you have enough personal finance to underwrite the business, or whether you have to seek outside financial help.
Loans, or Préstamos as they are called here in Spain, will vary from lender to lender depending on the amount of money you wish to borrow, and for how long. However, you will be pleased to know that loans are available to both residents and non-residents alike, providing certain criteria are fulfilled. Préstamos are available with repayment terms of anything from 3 years to 15 years, and can be repaid monthly, bi-annually, or annually. In order to find out more in terms of what loans are available to you and over what repayment periods, levels of interest, etc, you can contact the Instituto de Crédito Oficial, or any major bank (Banco). But like anywhere in the world, you'll need to be prepared to look around in order to get the best deal.
If your business will be creating new employment in a depressed area, then you may be entitled to a government grant. To find out more about this you can contact the Spanish trade department known as the DGPPME who can provide further information.
If you have difficulty in obtaining a bank loan you may wish to consider using a Business Angel. As you may guess from the name, business Angels, are prepared to accept more risk than conventional banks are willing to undertake.
Last but by no means least you will need to consider if you require any licenses or permits to begin trading. Don't relate to your knowledge of UK affairs in this matter as Spanish laws and practices can be quite different. In order to ascertain whether a special permit or license is required, you should contact the local Town Hall (Ayuntamiento) and Comunidad Autónoma who are responsible for these affairs in your area.
The world economy is still in something of a recession and Spain is of course no exception. So if you are considering setting up your own business, make sure that your finances are sturdy and that your overheads are as low as possible. Good luck!
Updated: June 22, 2022 CET
Updated: June 22, 2022 CET