The incredible challenge of doing business in The Bahamas
One of the most complicated propositions of life in The Bahamas is operating in the business arena. On the surface, it may seem straightforward, but what I have discovered is that doing business is massively complicated and not for the faint of heart. When you sign up for business you are in for a ride of a lifetime, where your journey can resemble an amusement park ride, a horror movie, or death by the sting of a thousand wasps.
I don’t mean to be pessimistic and if you stick with me to the end there is hope, but hope begins with reality. Ignorance and assumption will get you killed in business in The Bahamas. So, let’s begin with reality. Getting a business name and license or even incorporation in some types of businesses, can be fairly benign. Incorporation, in other businesses, can be a problem when it comes to long waits and delays, but the only major problem may be the wait – except in certain industries and non-profits to which the horror movie plot applies. Sometimes to get power or phone lines to your business, you can experience massive frustration and, in some cases, Bahamians have been known to “tip” BPL or BTC personnel to get service that they already paid for. Getting a phone in the United States (U.S.) can take one day, while getting a phone in The Bahamas can take anywhere from one week to several months. Getting power in the U.S. – a few days; but, getting power in The Bahamas – depends on who you know and who gives you favor. It varies and has improved somewhat, but, make no mistake about it, the smooth experience is not the norm. So, now you are in business. What next?
The next thing you find out is that in most cases none of your suppliers are local, so you have to bring in everything from the U.S., China, Caribbean, Canada or Europe. This is when the fun begins. People ask why an item costs $50 in the U.S. and $100 or $150 in The Bahamas, but what they don’t realize is everything has to be shipped and shipping can be expensive – especially by air which is often vital if you want to get things here on time. However, shipping is just the beginning. There are: customs duty, insurance charges, levies, VAT and, in some cases, “tips” to get your things quicker. Then, the cost of power may be .05 cents per kilowatt hour (kWh) in the U.S. and 40 cents per kWh in The Bahamas. Internet service is much higher, your phone cost is much higher and the high cost is not because of reliability and timeliness. You may pay a high price for electricity but that does not mean you will have stability. If you want to avoid agony in the summer months you need to have a backup generator and the price of the generator plus the cost to operate the generator is more than the exorbitant power cost. Can someone say the cost of doing business in The Bahamas is high?
If you are not having fun yet, consider the wonderful Bahamian workers. Of course, you have many good workers but, depending on who you talk to, the good, efficient work seems to be the exception. Workers may come late or not show up at all and ask their cousin to call and report their absence – if they call at all. Others are prone to “tief” and shrinkage due to theft, which can be high. If you don’t factor these things into your cost of business, you may think you are making a profit but may not be making a profit at all. Numerous business owners have shared incredible stories with me but I don’t really need to hear their stories because I have quite a few of my own, like personnel not showing up to a job site or appointment after they tell you they are on the way, and persons not showing up until a few days later for a same-day appointment, which you find out about after the customer is calling to tell you about how lousy your company is.
To complicate matters, the paradigm shift to online shopping means many of your customers who would come into your store now shop on Amazon and pick up their packages from the local courier. There are business owners who price gauge and charge inordinately high prices; but before you conclude that someone is being unreasonable with their prices consider the points raised in this article.
It is possible to run a successful business in The Bahamas and many Bahamians have run many prosperous entities over the years. It does not mean the business environment is easy but rather is a testament to the diligence and persistence of local business owners, because the landscape is not friendly in most cases. You can succeed and many do succeed – but make no mistake – it is incredibly costly and difficult to do business in the Bahamas. The key is to do as Jesus said in the scripture that follows: count the cost.
Luke 14: 28-31 – For which of you, desiring to build a tower, does not first sit down and count the cost, whether he has enough to finish it – lest, after he has laid the foundation, and is not able to finish, all who see it begin to mock him, saying, ‘This man began to build and was not able to finish’? Or what king, going to make war against another king, does not sit down first and consider whether he is able with ten thousand to meet him who comes against him with twenty thousand?
For those of you in business, you know very well what I speak of. For those not in business, before you enter, get counseling about the realities of the industry. Talk to someone who knows the landscape. Business can be a great and very rewarding experience, but it can also be an incredible challenge. Enter with caution and the right information. I wish you the best.
• Pastor Dave Burrows is senior pastor at Bahamas Faith Ministries International. Feel free to email comments, whether you agree or disagree, to firstname.lastname@example.org. I appreciate your input and dialogue. We become better when we discuss, examine and exchange.