Italy may not feature among the top free economies of the world, nevertheless finding an affordable business opportunity is not that difficult. I mean yes, the bureaucracy can be quite daunting, at times, but that’s the case almost everywhere around the globe. However, Italy still offers a host of good business opportunities across many sectors to anyone who wants to look for an affordable business opportunity or find a job. Look for popular areas such as tourism, wine, cafe and fashion, where opportunities are multiple. The important decision to make here is whether to buy an existing business or start from scratch.
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1. What Business Opportunities to Look for
An old proverb goes “stick to what you know”. When looking for business opportunities make sure you look in areas that are familiar to you. Or that at least is something in line with what you know, or where you can use your skill sets and experience. Starting a restaurant near the beach in Salento may sound like a great idea, but you need to ask yourself whether you can do it or whether it is plausible for you. And unless you are experienced in the restaurant trade, it’s probably not such a great idea.
Select the area where you want to settle down. Find out about the people in the neighborhood. What do they like? What do they buy? Where do they mostly spend their time? And similar such questions. In other words, market research is the key when it comes to setting up a business within your means. The answers could provide you valuable clues about the economy of the area and give you a fairly good idea about what can thrive there. If you are the lone investor, choose a business where initial investment is low. You will need a lot of time to break even and then recover the capital. The smaller the loan involved the better as the interest burden will also be lower. Also consider the time and effort that will be involved in setting up the business. You should be able to maintain a proper work-life balance.
2. Buy or Start
If the decision is to buy you have to get in touch with the Chamber of Commerce. It will inform you of the value of existing business and it can also help make you aware about the legal procedures involved in buying a business. The steps involved can be broadly broken down into the following steps.
- Obtaining the necessary licenses required to run the business. You need to ensure that your qualifications are recognized in Italy and you have the necessary certificate of competence.
- Paper work for both buying and selling. This will involve legal transfer of ownership and subsequent entry in the Italian Business Register. This will have to be necessarily done via an anotaio(notary).
- For taxation purpose, the business will need to be registered for iva which is the Italian equivalent of VAT. You need to find out whether the partita IVA or what we call the VAT number can be transferred to you or whether you are required to get a fresh one for your new business. This is essential if you are taking over as the only trader.
Buying an already established business has a lot of advantages. You do not have to lose your sleep in trying to get the business started or build the clientele. You already have that in place. You can also track the business’ performance from looking at its books of accounts. The only challenge is to keep the ball rolling and take the business forward from where it stands. That depends on your leadership and competence.
The procedure involved in setting up a new business will depend upon what you intend to do. The procedures involved in launching a real estate agency would be quite different from those involved in launching a restaurant for example. Therefore, the paperwork and documentation required for each line of business would be different from those of the others. Some will even need you to take quite a number of exams and undertake an official course of study, in Italian, which may take about a year. Broadly, the steps you will need to take are:
- Choose a line of business
- Decide on the structure of the business
- Prepare a business plan
- Arrange for finances
- Obtain the necessary licenses required to run the business
- Get in touch with “Chamber of Commerce”
- Prepare the necessary paper work for buying/starting the business
- Get registered for a Codice Fiscale (individual taxpayer number) and a "Partita IVA" (VAT tax number) both released by an "Agenzia delle Entrate" (Tax Office)
- Register with the Business Register through the "Camera di Commercio" (Italy’s Chamber of Commerce)
- Employ the services of a notary to formalize the setting up procedures.
Many regions in Italy offer financial incentives to new businesses. Areas such as the Basilicata Region offer attractive incentives for blooming businesses which can cover up to as much as 50% of investment costs. Regions such as Abruzzo offer financial support to SMEs.
Piedmont has a built-in system of incentives in place, mainly for start-ups and development incentives for the most innovative kinds of enterprise. Many of the measures explained in the regional planning document (DOCUP) include incentives such as unsecured contributions of up to 50% towards expenses incurred in feasibility studies, personnel and consultancies, patents and license rights, laboratory instruments and equipment for use in pre-competitive research. It also offers loans with affordable interest rates that can be utilized while making purchases of scientific equipment for laboratories. There is also provision for unsecured contributions for supporting start-up enterprises created by researchers.
Sardinia, which has been classified as an EU Objective 1 area, is able to offer considerable financial assistance in order to provide support to entrepreneurs while setting up a business and also while undertaking consolidation of businesses. Sicily offers an opportunity for granting the maximum aid levels permitted by current European Union regulations, presenting a well-defined framework of support for the setting up of and the development of entrepreneurial activities, consisting of incentives given for productive investments, incentives for undertaking research and development activities, and the training and employment of human resources.
While choosing a location for your business you might want to take a look at these available incentives. This is particularly helpful in case of startups and cases where substantial startup cost is involved. Choose carefully to suit your needs as it makes no sense to incur a heavy financial burden right at the beginning when you do not know whether your business would be able to stand on its own feet. Receiving financial aid or a grant at this stage can be extremely helpful. Some of the businesses that can be set up at a comparatively lower cost are the following: -
- Information & Communication Technology
Political interference, high levels of taxation, bureaucracy, corruption, a rigid labor market, an ineffective judicial system, a complex regulatory framework and the high cost of conducting business weigh heavily on the Italian economy. It is, therefore, advisable to look for business opportunities in areas where there are lower taxes and less labour employment involved. Get expert legal advice before taking any step. The Italian economy has come a long way. Thanks to the reforms that helped to reduce the menace of bureaucracy, Italy now offers an environment conducive to the booming world of new business opportunities. Choose what best suits you or what you think you are best suited for. Avoid lines of business which involve comparatively less complicated legislations. Choose the location of business carefully. Most regions within the country offer various financial assistance and incentives that help start-ups. Also choose a line of business which does not entail huge start-up costs.