Want to start a business in Spain, but you’re running out of ideas?
To help you out, here are the 6 best investment opportunities for small businesses in Spain for 2022. In the fall of 2020, the Spanish business world was speculating with apprehension about the “new normal.”
What does this mean for investors?
Let’s start with a survey of 5,000 respondents from different social backgrounds. An alarming report tells us what the typical consumer thinks and what their worries are.
When asked what respondents were concerned about, the answers were as follows:
- Health: not concerned 22%, concerned 24%, strongly concerned 54%.
- Finances: not concerned 10%, concerned 19%, strongly concerned 71%.
Read that again – despite the life-threatening pandemic crisis, people continue to worry more about finances than health. So, the peculiarities of starting and doing business in Spain boil down to the following:
- The Spanish government is interested in foreign investors who want to become local entrepreneurs. Therefore, any adult foreigner who is legally living in Spain has the right to start a business.
- To work legally in your company, you must obtain a residence permit in the country and a work permit. Moreover, the manager of the company opened by any foreigner must have Spanish citizenship.
- Business can be conducted in different ways: by opening a sole proprietorship or partnership/joint ownership.
What should you choose?
When choosing an idea, pay attention to the region in which you plan to do business. Let’s see what will be in demand on Spanish soil.
What type of business will be in demand in Spain after the quarantine?
Habits are hard to break, but with the pandemic, Spaniards are used to ordering almost everything to their homes: cosmetics, stationery, food and prepared foods. Why not continue this trend not only with groceries but also with Saturday night pizza, laundry, local fruit or anything else? Many people won’t be going back to the old, risky model of shopping.
The business of health
Speaking of safety, there’s no better way to protect yourself from the coronavirus than to stay healthy and have a strong immune system. The gyms are no longer overly safe. Healthy eating, walking clubs, social sports, and natural supplements are what people want.
Retrofitting the acreage
Construction is waning, but this is not the case with the creative space renovation and conversion industry.
There are many conversions going on in Spain today. Former shopping malls are being converted into affordable housing. Apartments are being converted into full-fledged home offices for remote employees. After quarantine, converting “dead” space will remain a trend.
Taking care of the elderly
Many elderly people are afraid to go outside, but they need help around the house to fill the refrigerator, change a light bulb, fix the TV and get pills from the pharmacy. A local business that helps people, offers safety and a sense of security is sure to work.
Spaniards have begun to save money, so new appliances are bought less often, but most things can be repaired – people take goods to the repair shop or call a repair team from home.
The general tendency to economize and eco-consumerism have encouraged people not to buy things in stores but to have them made to order and from self-selected fabrics, so that they go with our other items of clothing.
How should you prepare yourself?
According to the Spanish Commercial Code, it is possible to set up a joint stock company (Sociedad Anónima) and a limited liability company (Sociedad Limitada) without a residence permit. Foreigners usually choose the latter because of the relatively simple and rapid registration process (2-4 weeks), the small amount of share capital (3000 euros) and the small liability (the founder bears it in the framework of the contribution to the share capital). But we must remember that the founder can’t be a director – a citizen or resident of Spain must be hired. On a tourist visa, you can be a founder, but you don’t have the right to work in the country and therefore you can’t hold any position.
As for individual entrepreneurship, you need a visa with the right to work in order to register. However, the LLC and JSC can be created even with a tourist visa. A private company does not require a share capital, and taxes are much lower (especially at first). That being the case, the responsibility is higher (all property, including personal).
Opening a business in Spain by a non-resident is almost no different to the process restricted to residents. All that is required is the Número de Identidad Extranjero – a foreigner identification number. The whole procedure looks something like this:
Step 1: Obtain a foreigner identification number
You can do this at the Spanish Consulate of your country or at a police department in Spain.
Step 2: Conclude a contract with the assessor (manager)
For the operation of the future company. At this stage, you will need a translator, who will translate in duplicate the agreement that will provide legal protection for you and your business.
Step 3: Choose three possible names for the company
Then send them for a uniqueness check and wait for the conclusion (about two weeks). At this stage, you will need a marketing translator to help you to create a well-fitting and memorable name.
Step 4: Open a bank account in a Spanish bank and pay the share capital
Remember, the minimum amount for LLC is 3012 euros and 60,101 euros for JSC.
Step 5: Prepare the constituent documents (articles of association)
Don’t forget to certify them in the presence of the founders, the manager and the notary. Translating documents into two languages is a critical step to avoid potential business problems in the future.
Step 6: Pay the tax fee of 1% of the share capital
Then send the articles of association to the Chamber of Commerce for registration in the State Register, to the tax authorities for obtaining a tax number (CIF), and if the activity requires a license, also to the licensing authorities.
You may also need copywriting to upkeep your social media and blog, localization if you already have a website and need a Spanish version, and translation of the advertising campaign if you decide to strengthen your presence in the market.
So, why do you need a linguistic services provider?
To avoid ending your business in Spain in the first month, we advise you to find a native Spanish speaker and cultural translator to avoid offensive blunders.
Idea-brands that work fine for one country, in literal translation can cause bewilderment or even anger.
Experienced translators and marketers know a lot of funny brand “masterpieces” of literal translation. For example, a slogan for Coors beer that works great for American audiences is: “Turn It Loose!”. When translated to Spanish, it read: “Suffer from Diarrhea!”
Even General Motors managed to arouse the bewilderment of consumers in Latin America with a new car brand Chevrolet Nova (in Spanish, “No va” literally means “doesn’t go”). To introduce the brand to a new market, it is also important to consider the peculiarities of the jargon. Thus, the dry deodorant Mist Stick (“Mist Deodorants”) amused a large portion of the German population because the word “mist” in the German language, along with the direct meaning “fog”, also means “manure”.
The literal translation of the Pepsi company slogan, known to us as: “Live with the Pepsi Generation”, was interpreted by the Chinese to mean “Pepsi Will Make Your Ancestors Rise from the Grave.”
Contact us and forget about translation problems! Speak perfect Spanish with your clients!