How to Open a Small Business in Bali

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The Indonesian island of Bali has a reputation around the world of being a colorful destination for tourists. It also boasts a thriving business economy that's become a fertile ground for local and expat startups. If working on a tropical island is your dream, starting a business and living in Bali might be perfection.

Business Ideas in Bali

Bali needs many of the same businesses as the rest of the planet: plumbers, electricians, advertising, accounting and retail. However, if you'd like to piggyback your business on the island's brand, you might consider business ideas in Bali that reflect the exotic image the island has in the rest of the world.

  • Rental property. Buy a bungalow or villa in Bali and turn it into a tourist rental. The initial investment may be steep, but maintenance fees on the island are relatively low.

  • Arts and crafts. Balinese natives are famous for the distinctive wooden carvings, furniture and textiles among other handmade goods. Selling their work overseas or in a boutique on the island can make a profit for both the craftspeople and you.

  • Wedding planning. Bali makes a fabulous wedding locale for tourists who can afford it. They're going to need a local business to arrange a lot of the details for them, so why not you?

  • Tourist services. Whether it's day trips, massages or surfing lessons, tourists are willing to pay to have fun. 

Tips

  • Bali is a tropical paradise, but the government still wants paperwork. You'll need to acquire a KITAS visa for long-term residency, open a bank account and then set up your business legally. You can either own 100% of the company yourself or work with a business partner in Indonesia.

Another option is starting an online business in Bali. Expats and tourists rely on the internet to stay in touch with their homes or former homes, so the island has an excellent IT infrastructure. You can coordinate your team from beautiful Bali as easily as you could from an office in the United States.

Visas for Business

As in the rest of the world, starting a business in Bali requires paying attention to paperwork. You can enter Indonesia with no documentation except a passport and return ticket home, but you can't stay more than 30 days and no extension is allowed. To stay for business, you need a visa.

A business visa is good for up to 60 days. That's enough time for you to start applying for a KITAS, the Indonesian acronym for an immigrant working visa. KITAS lets you stay in Bali for five years, then you can renew for a year at a time. You'll need a business partner in Bali to sponsor your KITAS application.

Indonesia takes its visa laws very seriously. If your visa expires and you're still around, you could be liable for a $70 per day fine and be jailed, detained or deported. You should keep your visa and passport on you at all times as Indonesian police can demand your papers at will.

Setting Up Shop

Starting a business in Bali requires several steps to establish yourself there besides landing the KITAS. For starters, open a Bali bank account and make regular transactions. This gives you credibility with the business community and shows you're serious about starting a business in Bali.

Indonesian law allows you to set up as a foreign investment company or PMA with limited liability protection. You need an investment plan of at least $800,000 and capital of around $200,000. Some industries require you to find a business partner in Bali. Alternatively, you can open a "nominee company" in partnership with local businesses, which allows you to operate with a much smaller investment.

If you're renting or buying business property in Bali, it's essential you find a site with the right IMB permit. The IMB establishes what kind of business can be done at a given location: an office and a restaurant require different IMBs, for example.