If you’re not ready to retire yet, starting a business in Ecuador is relatively easy and very common among expats. We are friends with several expat entrepreneurs who came to Ecuador and started a variety of successful businesses.
Ecuador Has an Entrepreneurial Culture
Ecuador is an entrepreneurial, mom & pop business culture. You’ll find lots of small shops and restaurants that are family owned.
Leases for stores and restaurants tend to be very low, as are hourly wages for employees. The minimum wage in Ecuador is $400/month, but you are also required to pay for health insurance and bonuses. Those might add up to another $100/month.
The cost of domestic products like food for restaurants and items made in Ecuador are also very low. However, imported items are much more expensive and often cost-prohibitive.
Low Barrier of Entry for Starting a Business in Ecuador
This means the barrier to entry for businesses in Ecuador is low, which also means the competition is high in most fields. You’ll find that the amount you can charge your clients or customers is much lower than you were able to charge back in the United States or other developed countries.
For example, a typical one-hour massage in Ecuador costs between $20 and $35, depending mainly on whether you go to them or they come to you. Hair stylists charge $5 to $10 for a cut, and $25 for a color.
Local Ecuadorian restaurants charge $1.50 to $5 for a typical meal while nicer, more expat oriented restaurants charge $5 to $10 for a meal. Even the nicest restaurants we visit like MOMO in Olón or NOE Sushi in Guayaquil, Quito and Cuenca cost half what we would pay for an equivalent meal back in Denver, CO, USA.
We know several expat real estate agents in Ecuador, and several have told us they are not guaranteed to receive a commission on a sale. There are no regulations that govern agent-represented real estate transactions like those in the US.
One of our friends had a house listing for 3 years. She advertised the house online and showed it countless times to potential buyers. In the end, the seller found a buyer through a friend and refused to pay the seller’s agent commission. What’s worse, the seller took the agent out to dinner to celebrate the long-awaited sale, only to insist on splitting the check at the end of the meal.
Business Opportunities in Ecuador
With all that said, there are LOTS of opportunities for starting a business in Ecuador, especially for new types of businesses that might seem common back in the US. As the Ecuadorian middle class grows, they are excited to have more “developed” country amenities at their fingertips.
Here’s a list of several expat businesses in Ecuador:
- Inti Luz Properties
- Ecuador Shores Realty
- South Indian Restaurant
- MOMO Restaurant & Deli
- Cuenca Expats Magazine
- The Cuenca Dispatch
- San Sebas Café
- Paradise Indian Restaurant
- Namaste India
- Double D’s Delights
- Bodhi Burgers
- Daisy’s Pet Food
- ArteSana Family Bakery
- VIP Home Healthcare of Cuenca
- RumiSol Yoga
- JungleGym Fitness
- The Tribal Fusion House
- Vino & Van Gogh
- Madre Tierra
- Villa de los Sueños
- Massage Therapists
- Reiki Practitioners
Some of these expat owned businesses are full time, while others are hobbies. The Ecuadorian government is very happy when expats move to Ecuador and start a business, especially when the business creates jobs, so they’ve made it relatively simple to do.
They aren’t as appreciative if the business only caters to the expat community, which creates the perception of an “expat bubble.” If you start a business in Ecuador, try to include the local community as much possible.
If you have an entrepreneurial spirit, but have found the barrier to entry in developed countries that are run by national chains and mega-corporations is too high, you might actually be able to realize your dream of starting a business abroad in a small-business friendly destination like Ecuador.
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