Shipping your product around in Nicaragua

Manufacturing in Nicaragua can be very lucrative for you if you have a product your looking to assemble or build. Currently there is a wiring harness manufacturing plant outside of Leòn. All of the workers live outside the plant in a small neighborhood. If you have a product that you are thinking about manufacturing here keep in mind that skilled labor will need to be taught. This can be a long process. Make sure you have quick access to a good road system. Do not start your business where you will have a difficult time moving your product. Keep in mind the road system in Nicaragua is not perfect and you will often have delays. Your not allowed to move your vehicle from the road if you have an accident so imagine what the roads can be like if there is one. The line of traffic goes pretty far back and your stuck just waiting there. You can try to have alternative routes and this may work but don't rely on it. There are several ports you can ship out of. The biggest port however is in Corinto. This port is on the Pacific side right next to Leòn on the map. Seeing that both sides of the country touch the water you shouldn't have a problem finding a port. Remember that Nicaragua has several small ports but maneuvering products around some ports is easier than others. Do your research on which port to use. Do not assume. In Corinto, they have a population of 17,000 and can handle bulk, liquid, cars, etc. They have a full service container business set up there. You can ship and receive here with little headaches. If you are looking to export or import into the country and you have any questions shoot me an email.

Having an edge with technology in Nicaragua

If you have a competitive advantage with the production of any product you will find a solid way to profitability. The barriers to entry for a automotive production company are virtually impossible to break through. The entry into mass producing baseball caps in China is pretty easy comparatively speaking. You can see opportunity all around you in Central America. North America has become so over saturated with business that they open on top of each other here in New England. In the south such as Texas it's just as bad. When you travel to Central America you can see the opportunities around every corner. First world technology can really give you that competitive advantage that you seek. For example, I own a chain of restaurants in the states, the more I own the cheaper the cost of my food. The more food I can purchase etc. There in Nicaragua they do not have the same type of supply chain. You will have to buy your produce in the markets with the rest of the merchants. Food looks fabulous there. You just won't have the deliveries coming in everyday. This would make a huge difference in the price of your goods. Quite often the price of the food determines how long you can stay in business at that level. This is an important step that many people seem to overlook when starting a new business. You must take into consideration the cost of your goods compared to what your competition is paying for them. If your pizza is better than your neighbors but he owns 10 shops, he is paying less than you are. You better start expanding fast or he can just lower his price a bit and push you out.
This is where having 1st world technology could be your best friend. Think for a moment about what your business would be like if you owned a crane in any of the major cities there. They would have to rent that from you. They do not have 23 crane operators there like here in my city. You would be the only one there. If there is one in Managua move to Leòn. You guys get the point. I realize getting a crane into Nicaragua would be a huge undertaking but it's just an example. If you are looking to use technology to help you gain an edge shoot me an email and I can discuss it with you further. (Photo below by Monsk April 2011)

Technology in Nicaragua

How can we use first world technology in Nicaragua today? Several ideas rush to mind. For example when I stayed in Greece for the summer the wait to get a land line was 2 years and you had to bribe a city official to get one. Then came the introduction of the cell phone and changed all of that. Now everyone uses a cell phone and the country is free of unsightly telephone poles everywhere that are out dated and an eye sore. The same is virtually true in Nicaragua as well. The cell phone players took out the monopoly of the land line player quickly. I wish I could tell you that the land line company learned it's lesson but I'm sure they just moved on to a monopoly on cable modems. With the introduction of different technologies into third world countries, we can look to see if this can help us project where it's going to take place and in what space. If you can position yourself in a technology area you will be able to catch piece of the movement into the flight of tech. Here in America someone comes into my business every 2 or 3 days designing websites. They offer to set me up for a small fee and they will maintain the site and do all updates for a nominal fee. The first players who took advantage of this business opportunity did great. There are still people designing sites that are doing well. Just an easy quick example. Now you can purchase the web design software for nothing and do it yourself. I remember when web designers were more important than anyone else. I remember working on Wall Street at the time and companies were paying over $10 million for their website designs. Imagine if a start up was announcing that number today? They would look mighty foolish. I understand some companies can afford to do this so please don't email me examples of companies spending that kind of money. ETYS or better known as E-TOYS did the same thing and they are now gone as well. The list is endless with the dot com busts. The examples are everywhere. We seem to be learning a little quicker now when it comes to technology. We no longer just throw money at it blindly.
We read somewhere everyday that only x percentage of people are on the Internet. Just wait until the rest are? Really? Im sure it will get a boost but to what extent? 70% of the worlds population earns less than $2 a day. When they sign onto Google at night what are they buying? Nothing is my guess. I'm not saying that positioning for future sales is a bad thing only that hoping to gain sales from people who aren't buying is foolish. Your better off finding your little niche. Where are the niches in Nicaragua? Everywhere! Back to my first post on buying milk. The following pic is of a monk in India.
He's not in Nicaragua but you get the idea. Comments are welcomed. Thank you Buck!

(Photo: Source: Der Spiegel)

FDI in Nicaragua

Foreign investment in Nicaragua has some very interesting rules and figures. Each site reports different numbers. In 2009 the country saw FDI at $230,000,000 or $5.29 billion Cordobas. Nothing crazy at that number. The high school in my town that was recently constructed costs the taxpayers $88,000,000. This year their FDI is much higher. They have the Tumarín Hydroelectric Dam project going on which is supposed to cost $700,000,000. This was rewarded to a Brazilian company. Still with that kind of money flowing in for an infrastructure project is very significant. FDI is poised to continue to rise because of the business stance the government has recently taken. They want more FDI. They have given tax breaks for certain products coming into the country and taxed others to the extreme. Chicken for example has an import tax but was recently dropped off the list because of a nationwide shortage. Sometimes it goes to waste because it can't clear customs without the proper paperwork. There are several articles on the net that describe this situation. Just Google it and you will find it with no problems. I have read several articles about Nicaragua allowing corn to come into the country when they have shortages. The government seems to allow imports of certain foods when prices rise. For example, the government has just started to allow powdered milk imports because of the recent price increase of milk. Milk is a difficult product there. FDI currently goes into energy , free zones, and tourism.

Street Business in Nicaragua

Nicaragua has a early morning rush and crowded streets. By 8am the main square is bustling with people. León is a city that works. If you go to other touristy destinations the town center is usually not too busy in the mornings. Not the case in Nicaragua. By 6am you here roosters, radios, truck horns and music. The people have a surprising routine schedule. Meaning if you see a lady selling chicken door to door in a neighborhood, chances are you will see her again the next day selling in the same area. Several women set up outdoor restaurants behind the cathedral. They set up makeshift BBQ pits and tables where you can sit and enjoy a meal in a parking space. Cars are not too bad in the evenings there when traffic has slowed down. The food looks surprisingly good. I tried a hot tamale wrapped in a banana leaf that was really warm and fabulous. It was made with a corn masa. The chicken is surprisingly delicious. Not just my chicken, everybody's chicken. Just ask someone who has been. Make shift restaurants are on the sidewalks and streets at night. Rice and beans are the staple and women sell large pots of it during a dinner rush. You can purchase this for about $1or just over 25 cordobas.
Not many handmade items to purchase here. I'm sure the craftsmanship is here just not where I was looking. I was trying to buy a handmade guitar that was really nice. I only found guitars that were about $20 and were cheaply made for the tourist. I wasn't the only guy looking for a well made guitar either. You can take a taxi to any of the 4 guitar shops around Leõn. It's just as easy to walk to them if you know the way.
When you are window shopping in this country the merchants do not bother you. If you are not interested they will not pursue you. Nothing like Mexico city or Rome for that matter. As an entrepreneur I have a hard time getting my head around this unique aspect of the country. They could sell double a day with a little persistence but it's nice to know you can just walk away without being hassled. The beach is different. The kids push shell necklaces on you like crack. You can buy one and have peace and quiet much sooner than later. Most families in the cities have the front of their house set up as a business. In America it goes Home Depot, Five Guys, CVS, and a Starbucks. In León it goes, Panadoria (small store), small local pharmacy, small restaurant, phone store. Looks just like the picture I'm posting but stores are in the front of all the houses. Houses are generally the old Spanish colonials that are made of adobe walls. Newer modern ones made with concrete beams and are mandatory if you want a bank loan for a purchase.
The bags of ketchup and mustard are displayed in the markets on tables and look very interesting to those who don't know what it is. I guess this is how the people purchase it here. They also sell soda and Popsicles in plastic bags. They look something like this and several people walk around with them. See photo with two red bags.
Selling with technology here in Nicaragua. Social networking is just now becoming hot there and many are on Facebook. Surprising how many. I met people in small indigenous villages who had access to an Internet cafe with Facebook accounts. You can make several friends on Facebook there. Internet is spotty at best. Keep in mind it's best to use Skype when making calls from there but you can change your cellular plan for the time you will be there. At this time AT&T is about $2 a minute. Data roaming should be turned off to save battery life and money.

Buying Milk

Recently my wife and I went on a trip to Nicaragua.  The opportunity that we saw there somewhat amazed us. Here in America we own a chain of restaurants.  We are constantly under the gun of the town halls regulations.  No signs on the street. No neon signs that say open. No a frame signs pointing to specials. No type of banner on the windows, or stenciled lettering even.  There is pretty much nothing you can do to advertise on the road that is legal anymore.  Only your signage.  Signage should be suffice but it never is.  The state took our sign down off a major road and we quickly learned that our sign was
one of the driving forces that helped us to succeed.  If you own a small business and think your sign has a small impact on the amount of business your doing think again.  I thought the same way until I learned my lesson.  The state took our sign out of eminent domain.  They did so to expand a major road and by doing so they have taken down around 30 businesses in our town.  No big deal?  I would agree, most of us can pick up and go and do other things but people like the landlords, senior citizens, and long term town businesses cant.  The problem is that the town will have to look for where its going to get the extra tax revenue now that all of the businesses have picked up and moved to other towns.  Now the town will have to impose higher taxes on its citizens.  These are the same people that opposed it before, the same people that do not want big business in their town. Well if there is no big business in your town then you have to pay for that. Only difference is your on a fixed income and no matter what the increase is its going to hurt you when you get the bill.  With all this in mind, we look at central America with open arms.

Watch this 7 second video and tell me what you see?  This is us buying milk every morning in Leon Nicaragua.  They come right to your door with a fresh bucket of milk. You buy it by the quart and you can see the woman giving it to us in our pot. No refrigeration, no stickers of how fresh it was or the expiration date.  Just milk in a bucket at the door. No BS.  If I wanted to be the largest milk distributor in Nicaragua I think I could be that with relatively no competition.  No problem. This is just one example of how open the place is. It worked for Stew!