Rumah247.com – The Indonesian economy is known for its domestic spending strength, which allows for continuous growth even amidst the global struggling economy. Combined with the wealth of natural resources and abundance of talent, Indonesia is a thriving market to start a business in. Expatriates doing business in Indonesia sometimes are discouraged because of the bureaucracy involved, but fear not! This article will help you to kickstart your venture.
Step One: Know the Type of Businesses You Can Start
Before you start a business in Indonesia, you need to know what kind of businesses you are allowed to start. Luckily, President Joko “Jokowi” Widodo’s administration has eased the business whitelist, making your business options now more diverse than ever. The Indonesian government used to keep a long blacklist of businesses that expats can’t enter to protect local businesses. However, in 2020, the blacklist was changed into a whitelist. Most business types are allowed, except for micro, small, and medium enterprises (MSMEs) and businesses that violate Indonesian law, such as businesses related to illegal drugs and armor.
Step Two: Know the Legal Process
After deciding the business you want to start, you should know the legal processes. Some businesses require you to partner with an Indonesian, such as owning a hotel with less than three stars or owning a business with capital less than IDR 2.5 billion. If you already have a partner in mind, great! You can move on to the next step.
The next step is to establish a legal ground so that your business is recognized. Usually, a business will need to be registered as Perseroan Terbatas (PT, or Limited Liability Company). A PT can be registered with the help of a business consulting company or a notary. This article explains in detail, how to start a PT and what you need to prepare beforehand.
Step Three: Avoid Pitfalls
Settled your legal requirements? Great! Now, you can start planning for your business. Research has shown that a lot of businesses fail in their early years due to inadequate planning. Therefore, you need to have a solid business plan to survive. Initially, you need to at least secure your capital, choose a place, and prepare working permits for your employees if you plan to hire another expat. Working permit in the form of KITAS is needed for you and your employees while staying in Indonesia to avoid deportation. Thankfully, working permit issuance is now easier than ever, and you can find detailed information
Choosing a place for your business is also important, as a strategic place will allow your business to flourish. Generally, your desired building should be classified as suitable for business in its IMB (Izin Mendirikan Bangunan, or Building Permit). If you do your business in a residential building, you might get into legal trouble, so checking the building permit before buying or renting your desired place is important. If you decide to build your office, you should also declare it as a business place in its IMB.
After your business is running, you should also remember that Indonesia is a growing country. It has a few growing pains and one of them is the ever-changing business regulation. An article you read yesterday might not be applicable tomorrow, so you also need to be agile in your research and avoid overplanning your business to allow it to survive. If you are used to a certain timeframe when starting a business in developed economies, it is recommended that you have a flexible timeline for your Indonesian business as things are different here.
A lot of expats are enticed to start a business in Indonesia because of the economic situation, but they pack-up after seeing the complexity of bureaucracy and the business situation after arriving here. Remember that the most important thing in business is to seize the opportunity by just taking the first step to start.
Successful Expat Businesses in Indonesia
Bali Brides is one of the most successful bridal specialists in Bali. Started and operated by Australians who fell in love with Bali’s beautiful culture, they offer wedding packages for locals and foreigners who choose to get married in Bali. Their recommendations are personalized and they could work with any type of wedding, from a small reception to grand ones.
Another successful business run by Australians in Indonesia is Bali Villa Escapes, which offers hand-picked luxury accommodation in Bali. Visitors could choose between hundreds of available villas in various region of Bali, and get discounted rates if they enquire through the website. If you are interested to rent a villa in Bali for your next trip, you can visit Bali Vila Escapes.
We hope that our article will help you to kickstart your business in Indonesia.
