The Rocky Road To Success: Opening a hotel in Nicaragua
Ever daydream of throwing off the nine-to-five rat race yolk, finding an exotic, sunny climate and opening a hotel, bar and restaurant where the palm trees sway and the snow never falls? Listen to the story of someone who did.
“The first six months were a nightmare. We had tiles falling off the roof on to cars in the street, we had to get permission to do everything-even to put trim around the doors. It took six months to get our cargo containers through customs when it should have taken two,” said Ellen and Marco Snoek, a Dutch couple from near Amsterdam.
What could have been done to prevent the nightmare?
Would they do it all over again?
Both have successful careers – he the director of an aluminum awning company, she in sales for Heineken- but long hours in the office left little time for each other. The idea to start a business somewhere with lots of sun had been born on their honeymoon. “Why do what people expect you to do?” they said.
So they began spending their vacation searching for their dream spot. First in Sri Lanka, then Thailand, Singapore and Malaysia. “We love Asia but the cultures were too different,” the said. They tried Mexico, Peru and Ecuador, but nothing seemed just right. On their next trip to Central America they had hopes for Costa Rica, “but after five days we said no way. It was like a zoo – too many animals, including the people.” And there was the incessant rain. Then a friend told them about Nicaragua. They visited Granada and fell in love with it. “It was like another life, back in time, and there was sunshine,” they said.
They drove around with a realtor for three days until one big old house, built in 1869, “grabbed our hearts. It was like an old abandoned castle. We had to kick the door open for all the bat and pigeon droppings on the floor.” They made the down payment that day by credit card, signed the purchase paper in Spanish, of which they didn’t speak a word, went back to Holland and with no residency or place to live, shipped their possessions and the supplies needed to open their “dream” hotel.
A few days later the realtor called. The seller wanted to increase the asking price by 10 percent, even with the papers signed. “The dream is over I told Ellen.” But after consulting with a financial manager, they decided to go ahead. To this day, they don’t know how someone can ask for more money after the papers are signed.
To begin construction, they simply opened the doors. “People just showed up offering to work.” Men pulled up with horse-drawn wagon to haul off debris for 20 cordoba’s a load. Masons, carpenters, electricians all knocked on the door offering their services. “We would hire them at a preliminary rate and then watch them. If they were competent we paid them more. If not, we would tell them to leave.”
The construction workers were “loyal and hardworking, but prankish; they like making fun of us. I didn’t speak any Spanish, and now all I was learning were dirty words.” Marco would spray orange marker paint on the walls and floors where he wanted things to go, then point and gesture.
A lot went wrong “because of them and because of me, but I would tell them to tear it down and do it again. Labor here is so cheap.”
Inspectors from the city appeared daily. “We needed permission to do the smallest things. We were constantly getting 50 cordobas fines. One day the police came and tried to fine us, saying we were building to near a school, while pointing to a nearby bar.
So Marco went to fight city hall. “It was from one office to the next, back and forth. The architect couldn’t agree on anything. I had a meeting with the mayor with a translator and was yelling at the mayor in English. I found out later he understood.”
Ellen, meanwhile, handled customs. “We were using the 306 law which made importing supplies for a new business tax-exempt, but we hadn’t established a corporation yet so it was all in our name and they wouldn’t let it through.”
The twenty-foot sea container had traveled the 9,000 kilometers from Rotterdam, Holland, to Limon in Costa Rica, then on a tractor trailer to Managua – all in a month.
It would be five months longer to complete the final 45 kilometers to Granada. “I had my packing list and they made theirs. For example, we brought along boxes of pencils to donate to schools. I counted the number of boxes but they opened the boxes and counted the pencils.” Marco Said. The customs officials decided on a tariff of one cordoba per pencil, which is more than they cost in Holland. Used electronic appliances were taxed at 45% of purchased value while “insurance companies at home would have said they were worthless.”
“They were polite and thorough, but had no respect for the property. Once, they laid paintings on the ground, then stood on them while they unloaded the rest.” The process was repeated three times before the final bill of entry was made.
“I cried three times: twice at customs, once at city hall” said Ellen.
But opening day finally came.
Ellen and Marco’s idea was patterned after a European Grand Cafe concept.
More a coffeehouse with a small hotel, upscale decor and limited menu.
But the first night 250 people came to the bar. We were going to close at ten, but we have a 12 o’ clock license…
What can you do?
The Grand Cafe became a thriving bar and restaurant business. They host theme parties, have a complete menu and opened eleven stylish hotel rooms.
Our dream business, El Club, is a success story.
And not every startup here is.
“We’re here 80 to 100 hours a week, but we make our own schedules and we see each other all the time.”
Some advice? Make sure your marriage is solid, or it’s done. Nicaragua is like quick sand! Don’t fight, use your head and stay calm.