Interested in opening a restaurant abroad? Going international with your business isn’t a new idea – many American business owners operate their enterprises outside the country today. In fact, one country perfect for prospective international business owners is right next door: Mexico.
Americans can open a restaurant in Mexico so long as they follow all procedures the Mexican government requires. Mexico welcomes enterprises that will generate jobs, services, and infrastructure for its economy. Adhering to the federal government’s guidelines is necessary but not difficult.
Opening a new business has steps that entrepreneurs generally understand, but what about opening a business in Mexico? You could search through the Mexican government’s websites; however, they’re written in Spanish and don’t translate well with language software. That’s why we’ve done the research for you! Continue reading to learn about the procedures and benefits of opening a restaurant in Mexico.
Are Americans Allowed to Open a Restaurant Business in Mexico?
Mexico allows foreign investors and enterprises to set up shop inside the country. Different types of foreigners can enter the Mexican markets, but it’s surprisingly easy for Americans. It’s a more straightforward process for Americans because the United States-Mexico-Canada Agreement (USMCA) simplifies access to Mexican markets.
Americans are encouraged to contribute to Mexico’s economy. Restaurants are protected by the USMCA, authorizing all participant countries’ citizens to open businesses within each other’s borders. With a few exceptions, Americans are entitled to 100% of profits from their restaurant in Mexico.
Great, now we know for sure that Americans are authorized to open a restaurant in Mexico. But what about the procedures? Documentation? Registration? As we mentioned, these aren’t difficult to follow and pose minor obstacles to your success.
How Do I Start a Restaurant in Mexico?
There’s a couple of steps required for Americans to include in the documentation that Mexican citizens won’t have to. Besides those, you’ll need the same documentation that Mexican citizens have to go through to open a restaurant. The Mexican government works quickly, so getting these done ASAP will get your business up and running in no time.
The steps you’ll need to follow before and after opening a restaurant in Mexico are included below.
Complete an Application for the Secretary of Foreign Affairs (SRE)
Here, you’ll be stating your intentions to the Mexican government along with your restaurant’s details (i.e., its name, service type, etc.). If you’re extending a restaurant chain into Mexico, you’ll have to provide more information about your company before moving on. To receive your SA-1 form and ask questions about this process, send an email to [email protected]. Or, visit the ministry’s website here.
Register Your restaurant in the Federal Taxpayers Registry (RFC)
Now that you’ve been approved by the SRE, you need to register your business with the Tax Administration Service (SAT). This is like registering with the IRS: they’ll create an ID number (your RFC) for your businesses’ legal entity. That RFC will be used to track all tax information related to your restaurant. Visit the official website for more information about the RFC.
Keep in mind that you’ll need someone who knows how to navigate these procedures from this point on. You should consult with a Mexican-based lawyer, preferably one specializing in business and tax law.
Document Employees With the Mexican Institute of Social Security (IMSS)
After registering your company with the RFC, you can begin employing workers for your restaurant! Although, when you hire your workers, you’ll have to register them with the IMSS before you pay them. Set this process up online before making any hires, or visit the IMSS at your restaurant’s corresponding office.
Give Notice to the Secretary of Health (SA)
Since you’ll be selling food to the public, you must notify the SA that you’re conducting business. You’ll have 10 days to do this after opening your doors, so don’t wait for the last minute. Ask your attorney to help you give the SA proper notice of operation.
Register With the Mexican Business Information System (SIEM)
All businesses must register with the SIEM. Though it’s the last step, it can actually provide some great benefits for your business. The SIEM grants access to other product and service providers who are also registered with the system. It could increase your sales or even help you find deals on equipment for your restaurant. Register for the SIEM with your RFC and legal entity name here.
If you were able to follow through with all these steps, congratulations! Your restaurant is up and running with all the necessary documentation. We wish you the absolute best of luck in your restaurant business endeavors.
For those who haven’t opened their restaurant yet, there’s no need to worry – you still have plenty of time. Maybe you’re worried about the costs of running a restaurant in Mexico or whether you’ll have enough money to start. Fortunately for you, we’ve also researched the costs of opening and running a restaurant in Mexico.
How Much Does It Cost to Open a Restaurant in Mexico?
Running a business in Mexico is much cheaper than in the United States. Things like rent, wages, and taxes are more affordable in Mexico overall. Low overhead costs are one of the best benefits associated with opening a restaurant in Mexico.
Opening a restaurant in Mexico costs from $10,000 to $60,000, depending on what you sell. Costs of buying or renting a space cost the most, along with equipment and employee wages. You should also expect to pay about $20,000 or more for documentation fees, your employment visa, and attorney’s fees.
Such low operating costs make opening a restaurant in Mexico easily profitable. Wages tend to strain restaurant owners in the U.S., making up a majority of business expenses. However, you’ll be pleased to witness how grateful, loyal, and hardworking Mexican employees are with how cheap Mexican labor is.
We hope this information helps you open your restaurant business in Mexico someday. Remember: if you follow through with all the necessary procedures, you’ll save yourself a future headache. Be sure to hire a lawyer to help with every legal process as well.
Mexico is a beautiful country for investors and entrepreneurs alike to open businesses in. Begin your journey as a restaurant owner in Mexico today!