Chi and I have had the displeasure recently of having to close our business. Connections was running strongly over the last 4 years and we were subcontracting for Exotissimo and Buffalo amongst others, our cooking class being especially popular. Exo are now working with some of our old staff to continue the concept. Thousands of delicious dishes have been prepared and customers satisfied. Not once did we receive anything but praise for our tours and products, so that is something to be proud of.
What happened?
The government, red tape, and regulations.
We were operating illegally, and we got caught.
Naughty thing number 1 - as a tourism company, you are supposed to have card carrying guides - meaning they have been put through the government brainwashing mill and come out only able to spout boring historical information as they drag you from site to site. Our 'guides' were all university students who knew what we wanted and got the concept. They were to be informed about their city and country, but not at the price of having fun on their 'tour', which was to be as informal as possible.
Naughty thing number 2 - which we genuinely didn't realize until the department of tourism pointed out to us, as a tourism company with inbound tourists, there is supposed to be a 250 million dong bond in the bank. That's around $13,000. If we were to continue our business, the bond needed to be placed in the bank where it sits without even being allowed to gain interest.
We decided against this kind of investment in our modest little tour company that was always successful and profit making. We had reached the point where to expand we needed to invest some real money, such as, errr, $13,000! The bond requirement would make it a $25,000 investment, and we could think of better ways to use that kind of money.
So, goodbye Connections.
Our next project won't be for a while, but I already have some ideas brewing. This is a land of opportunity after all - but yes, you do need an awful lot of cash sometimes.
15 comments:
Sorry to hear that Jon. Makes you wonder if those small travel agency getups in Pham Ngu Lao really have the $13,000 US in their banks or not.
Damn - you got noticed, or more likely someone saw your thriving operation and wanted in on the action. Hope you find something else as a side-line to keep you busy.
Sorry to hear that. The no interest thing is particularly stupid, given the rate of inflation of the VND. I think the typical interest rate for a VND account is 10%pa. By leaving 250 million in the bank for a year, you would lose 25 million straight off.
Yeah, let's just say it's an environment not conducive to small businesses (in tourism anyway!).
Phil, things in the pipeline for sure. Not that I need keeping busy..but you know...!
Kev, I think a LOT of tourism companies operate without the correct kind of license. Thanh Nien did a report on it not so long ago.
I'm going to Vietnam for Tet 2011 and your blog has help me a lot.
Thanks!
Hi Jon, sorry to hear about Connections. I'm sure your 4 years of experience in running your own business will come in handy for your next venture.
I have a few questions though. Assuming "naughty thing number 2" wasn't such an issue. How long would it take for your employees to become "brainwashed" and obtain legal card carrying status? Does it cost anything for them to be "trained" in that way? Would you have to shutter down your entire business during the training period? And assuming you decided to continue only your popular cooking class, would the cooks also be required to attend the government training class....i.e. employees that aren't really doing any tour related work but are employed by a tour company?
I'm in the process of starting up my own business and knowing the answers to those questions would be extremely helpful.
You would think that with just a 5% rate of tourist ever returning to Vietnam that the VN government would do all they could to encourage original and fun tour companies. Anyways good luck with your next venture.
Jon, I'm so sorry to hear about Connections Vietnam.
These stories make me despair about Vietnam. Taking a tour in Vietnam can be so bloody boring - being dragged around to crappy sites, being fed boring information and then being dumped in whatever restaurant is paying the guides the best kickbacks. I've heard that tour guides can get their ticket revoked if word gets back that they've expressed something that doesn't meet the party line. Kickbacks are ok, criticism is not.
Best of luck with your new venture. I'm looking forward to hearing about it.
Odgnut
Not sure how long the course takes to be honest, whether it is an undergrad degree in 'tourism' or something like that...? I'll ask the wife and reply back. Yes the chef's also were required to get their own business license/tax number. Of course! EVERYTHING is regulated here by the (unhelpful) government.
To be fair we could have just not 'shuttered down' at all and just continued as most other companies would - but as it's not a main source of income we decided to close and just say THANKS BUT NO THANKS to all that tedious paperwork and bureaucracy (not to mention the bureaucrats that go with it).
eatlaughloveanon
Thanks for the thoughts
Also one has to be from a 'red' background to be even considered for a card. People with opinions of thier own need not apply.
Requiring a license for tour guides I think is a pretty common practice all over the world. It protects tourists from rogue guides.
About the bond it also makes sense. As far as I know it is used to cover tourists in case the company violates the contract or in case they dont have travel insurance.
May be I missed something. Correct me if I m wrong.
Places to visit: Tour guide will meet you on arrival at Tan Son Nhat Airport and transfer to hotel.It is your free time to discover the hustle and bustle of Sai Gon city before entering to two wonderful days with a round of Long Thanh Golf Resort and Song Be Golf Club...
Most countries require tour guides to have licences to ensure that visitors are guided by experienced, qualified guides. If I was paying a tour operator for a tour, I wouldn't want some unqualified uni student guiding me.
And most countries require tour operators to have licences and bonds in order to protect customers' money should they go bust. The $15,000 bond in Vietnam is one of the cheapest in the world. I'm amazed someone would start a tourism company without doing a bit of research into this first! Sorry but you only have yourselves to blame :(
Thanks Tim for the comment.
We never ever received a single complaint from any customer about our guides. It was the concept of using uni students that appealed to people who used Connections Vietnam. I don't follow the philosophy that because you have a 'license' to do something, you can do it. Especially being a tour guide - the 'professional, qualified' guides we worked with from the biggest companies in Saigon were arrogant and unhelpful, but all smiles to the customers - two faced. And I think the customers who used our service also felt this way. We never tried to be a 'tour' company doing the same old same old that everyone else does. Plus we only ever did city stuff, nothing beyond except Cu Chi.
Regards to the license, throughout the application process which my wife was dealing with, there was no mention of the bond. We weren't exactly into doing any research because to be honest we were just setting up a very small enterprise for fun. No intention of giving up my day job if you see what I mean.
Thanks for your constructive and insightful comment anyway.
I'm coming to Saigon for the first time in November for a week's business trip but I will have a couple of days to see some sights. I saw a referecne to your operation on a website and (as a tourism academic) thought it was a great idea. I do dispair of "qualified" tourist guides who often only provide standard information that you can get in a book - not the real experience.
If you have any suggestions of how I can spend some time (I'll have two days at the beging - but jet lagged and one day at the end) that woudl be much appreciated
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