Some people do look at me like they would like to ask me that question when I tell them we are moving to Ecuador. Just like the guy who asked me “What are you going to do with that degree?” when I told him I was getting it in Latin American Studies. If you are asking yourself the same question, you probably won’t understand this post, or even this entire blog.
One of our main convictions regarding this slight change of venue is family. We have no family in the area, and while it may seem normal to many people to live only within the “nuclear” family and rarely see anyone beyond except for holidays and other special occasions, we don’t think this is normal at all. I think it is downright abnormal. To use the old cliche, It Takes A Village to Raise a Child, I think that’s exactly right. In Ecuador our kids will have the primos, tios, abuelos (cousins, aunts and uncles, and grandparents) around constantly, while here, their only regular contact will be their schoolmates, teachers, and the two of us. I think the presence of all these people around will definitely reinforce the values we want our kids to have, while growing up here they will have much more outside influence than we would like. And I think this is worth far more than some of the benefits naysayers like to point out to us (free public schooling of at least somewhat decent quality, a regular job with a steady income-ah, nothing like the pleasure of slow crucifixion by nine to five, cheap financing for all the wonderful things we don’t need, Bratz, GI Joe, …).
I’m not worried about my kids missing playgroups, playdates, or daycare either. We won’t need the last one since we will have plenty of help around.
I write this as much for your reading pleasure as I do for my own reference, as I know I will forget some of this info and need it for future reference. If you’re interested in learning the basics about how to export stuff overseas, read on. This was the first step in my tale of how to (or how not to) start a business overseas.
You can read all the books and guides to import/export you want, but there’s no substitute for the real thing. It sounds like a simple process, and it is, but there are a lot of details you won’t learn until you’ve done it. And most of those details involve costs, costs which you can avoid if you know what you are doing.
I used a company out of Miami called OceanAir Logistics as my freight forwarder. Basically, they are the ones who get your cargo on the plane or boat and prepare all the necessary documentation for you. And while maybe some of them are willing to hold your hand the first time you do it, I highly doubt it. This company certainly didn’t do any handholding for me, though they did do what they promised, on time and at the stated cost-plus a few surprises I’m going to tell you about shortly.
First, I purchased several pieces of kitchen equipment/implements from three different companies based in the US. I never saw any of it. You can have the company ship your purchases directly to the freigh forwarder, where your shipment will be consolidated at their warehouse until everything is there and ready to go. Then you just have to provide them with a packing list detailing exactly what is in the shipment, to whom it’s going, its value, and how you’d like it shipped-see Incoterms, these can quickly get confusing but CIF is the most usual form. They tell you what it’s going to cost, you pay, and basically it will show up the next day at its destination.
What this particular company didn’t tell me upfront, and probably others won’t as well unless you inquire, is that there are receiving fees for your goods at the warehouse. This is sometimes called the Warehouse in/out fee. In my case, $25 per delivery to their warehouse. So if it’s a 1,000 lb. pallet or a Fedex envelope, it’s $25 bucks out of your pocket each time. So say some of your items from one of your suppliers is backordered, and they send it after sending the initial shipment. $25. I had six warehouse receipts at $25 each so that was a quick $150 for the company. I was only expecting three shipments originally.
Most places will also charge you for warehousing the stuff, but fees usually don’t start until after your stuff has sat there 30 days, so you usually don’t have to worry about it.
One document most freight forwarders will prepare for you is the commercial invoice. This is a standardized form indicating the inventory, the shipper, the consignee, addresses, contact info, shipment value, that is used worldwide. You can get a software program to prepare it for you, but it’s usually only $10 to $15 to have the company do it for you.
There’s a document preparation fee that covers all the other miscellaneous paperwork, a cargo insurance fee, and sometimes an airline transfer fee, which as I understand it is the fee to move your stuff from their warehouse to the airport.
Not really much to it, just act like you know what you’re doing and ask all the right questions up front, and you’re more likely to get an accurate quote the first time around.
Air freight seemed pretty cheap to me, overall it came out to a little under $1/lb to ship from Miami to Quito, Ecuador.
We originally started to get ready to go over 18 months ago. That was before we decided it would be a good idea to have another child before going. So things were postponed for some time while we waited for Sabine to come along. She is here as of July 24, 2006, so we are now ramping up to go once again.
We made the decision to go some time ago, and I semi-obligated us to go by shipping some chocolate manufacturing equipment down before my last visit at Christmas so that I could produce more chocolates. Now I have the incentive that a large part of the needed investment to get started is now sitting down there waiting to be used.
Now that the moment of truth is just around the corner, we have been starting to second-guess ourselves, wonder about the wisdom of our decision, look at other options, and exhibit all the typical symptoms of self-doubt. Back when our departure was not just around the corner, it was “We’ll go when we have enough money.” We soon realized that to reach “the number” we would have to stay here another 15 years, or wait for retirement.
“The Number” would have made it easy, would have made it safe-and when is something easy and safe fun? When is it an adventure or a challenge? We thought if we can just hit “the Number”, that that way, if we failed in the business we would still have enough money to continue to live decently, and barring any major calamities, in perpetuity. Well, we realized that was never going to happen, or might happen when we reached retirement (a big might); in which case it wouldn’t happen it all. That would have made moot our primary reason for going. We finally just figured we’d have to go and give it a try.
Now we are realizing this is pretty much a no-return trip. Nothing is irrevocable, but in this case, failure is not an option. We have two kids to take care of. Now, we know we must succeed and if we don’t, we either have to look for another option for employment there (of which there are almost none) or come back to the US, sans all our belongings which we are taking with us.
The other big issue is finances. We figure we have enough cash, once we sell our house, to get set up and stay put for two years or so, while setting aside a large chunk to invest. But if we don’t start making money, we will have to start using those funds. We could use that money to buy a house in Ecuador and thus have no rental costs, but there is one major drawback to owning real estate in Latin America, that is usually not pointed out to you in all those ex-pat websites about living like a king on the beach in Central America or elsewhere.
Real estate is not a liquid investment in Latin America like it is here; that is, once you buy something, you can’t turn around and sell it several months or even years later-your cash is fully tied up. It could take years to sell, or you may never sell at all. There is no dynamic real estate market.
Most people here I talk to tell me “Go!” A lot of them say they wouldn’t have the courage to do something like this, and they admire us for having made such a decision. I don’t know if this is all true and they are thinking in the back of their heads “What idiots! Why would they want to go to a poor, underdeveloped country with no job opportunities!”
I see it like this; we can stay here slaves to the grind, my wife in a well-paying job where she feels the days are just passing her by, while I am at home taking care of the kids for the next few years (I’ve been at it now for three, and would have three more to go before I could go back to work). Our kids will grow up knowing most of their extended family as only strangers they might see once a year a few weeks at a time if that, around whom they hardly feel comfortable. Slaves to the idea that we have to have our hefty 401k/retirement account, our paid-off house, and all the trappings…etc. etc. Or take the risk, allow my wife to do what she wants which is take care of the kids, allowing me to do what I want which is make chocolate. Have our kids grow up with grandparents, cousins, aunts and uncles around all the time, maybe poorer materially, but richer in spirit and family. Our conviction is that family comes first, and our mental and physical health will be better with it around. Which would you choose?
My wife and I have been thinking about moving back to Ecuador for a long time-at least 5 years now. After a 2 year stint in Nicaragua with USAID, we both decided that living a mellower kind of life-the kind you might only have in Managua or some other underdeveloped town in an underdeveloped country outside the borders of the world of mass consumerism-was for us. We didn’t even remotely consider this possibility before living overseas for an extended time. Not that Managua is Paradise.
Potholes the size of craters, ox carts on the main boulevard, trash burning in the street, muddy rivers flowing down the street, fires in our backyard because the “peasants” were clearing the land for next season’s crop. Power outages, torrential rains, constant dust, the list goes on. But no constant barrage of media informing you how much you need this, you want that, or how much better your life would be with that next gadget. No constant reenforcement that you don’t have enough, that you should be gnawing at yourself from the inside out to acquire, acquire, acquire. No fancy restaurants to eat at, gourmet aisles in the supermarket, no noisy radio stations, no need for the latest and greatest…you fill in the blank. Ok, there is hardly anywhere left on earth free of these messages, but Managua was pretty close. Home cooked meals every day, a vegetable garden in my backyard, the radio announcing the time on the half hour-because nobody wears watches and they still aren’t slaves to the clock. I have spent over five years living and working in Latin America, and it continues to call me back, in spite of, or rather because of, all these things.
Just before leaving Nicaragua in September 2001, I made a trip to Ecuador and we bought some land in a small town called Cotacachi, planning to eventually build a house there. We haven’t gotten around to that part yet. But when we returned to the US from Nicaragua, we said we’d stay five years in the US at most, before going out on another overseas job (which we figured would come up, but for a number of reasons just hasn’t). Or before moving to Ecuador. So the five years is up, and we’re now counting five years and three months.
The main question has been, just what in hell were we going to do in Ecuador to make a living? A little over two years ago, I went to work in a chocolate shop in Alexandria, VA. An idea was born…I did some research over the web, and discovered via the US Commercial Service in Ecuador that there’s a big demand for chocolates, snack foods and other such items, and that items of US origin (or, in this case, made by a North American) generally have a winning reputation in Ecuador from day one just because of their provenance.
Last year I made two trips to Ecuador to do some test marketing. I turned out chocolates, caramels, candy cremes, brittle, toffee and other candy items. Both times (once at Mother’s day and once at Christmas) I nearly could not keep up with demand. And my only sales person was my mother-in-law, with some additional help from my sister-in-law and general word-of-mouth via the family. It looked good. The plan was hatched.