Viviane Faver
If you have always dreamed of living that laid-back island life, opening a small business in Hawaii might sound like the perfect way to create a new source of income to fund your new lifestyle. But moving to a relatively isolated island state with a distinctly different vibe from the rest of the country can be a hard transition — especially if you are trying to start a small business at the same time.
Fortunately, establishing a small business in Hawaii is pretty straightforward. To confirm that, I interviewed three successful entrepreneurs who had experience starting a small business in the Aloha State.
The Irish restaurant Black Shamrock Tavern opened fittingly on St. Patrick’s Day, March 17, 2022, in downtown Honolulu. The unique red-brick architecture of the Forester Building has attracted many Hollywood film and television productions over the years, including Hawaii 5-0, LOST, North Shore, and Mike and Dave Need Wedding Dates.
The owner, Jay Neihbur, moved from New Jersey City to Hawaii in 1999 as an active-duty US Marine. He met his wife and decided to stay on the island of Oahu and pursue his dream of opening a bar and restaurant. His first job out of the armed services was as a bar-back in a restaurant on the same street nearly 20 years ago. He soon began making pizzas there on Friday nights before becoming a full-time bartender.
He says the main tip for anyone wanting to open a business in Hawaii is to have a lot of patience. “Things work on Hawaiian time here. Another stumbling block is that I suggest the would-be entrepreneur come prepared to spend 20% more on all of their products due to the fact that Hawaii is one of the remotest lands in the world, and everything has to be shipped in. This is the difficult part logistically.”
However, there are also benefits, as local banks give great incentives to small entrepreneurs, as it is in their best interest for the city’s economy to grow. “There is enormous help from the government and all state bodies involved with local businesses.”
Jay’s Jersey accent is strong, but his Aloha runs deep. He has quietly but strongly supported various worthy charities over the years, including veterans’ groups. His generosity is a model for a successful restaurant being a helpful member of its community. It’s something he learned from a Hawaiian friend, also a small business owner, whose charitable giving to childhood cancer research and Hawaii literacy is almost incalculable. Jay understands service. The colors of the new facade at the Black Shamrock are a nod to the colors in the United States Marine Corps flag.
Another example of perseverance coming from New Jersey is the couple Lindsay and Luciano Colle, who opened a car rental company in late 2015. “The original purpose was to relocate to a climate that had warm weather and skydiving year-round. At the time, Luciano was a full-time Skydiving Instructor, and there was a great opportunity to work at a company on the North Shore of Oahu. But once I was in Hawaii, I saw the potential of tourism and put in my mind I had to open a business to serve that area,” said Lindsay.
The couple started the rental car company with one car that they now refer to as ‘The OG.’ They bought a used car that started to have some issues. Luciano made it his project to figure out the mechanical problems and fix them. This took quite some time, during which they purchased another primary vehicle to use. Once his project was complete, and the car was in good running shape, they decided to start offering the car for rent. “Once I saw there was demand, I decided to add another car, and another, and it just grew from there. Early on I established my own LLC and created a website to be prepared to do everything digitally. After about two years, I decided to slow down with skydiving and focus on growing the fleet. After a few more years I rented a large commercial space that we operate out of today,” says Luciano Colle. Their primary audience is American tourists and a few international customers, but the majority come from mainland USA.
In his opinion, Colle says that starting a business in Hawaii may be significantly more challenging than in most other US mainland states. The high costs of living and operating a business make it exceptionally difficult to get started. “The state and specifically the county of Honolulu have very strict and unique policies and protocols that add work and potential obstacles to businesses. For example, Hawaii has significant land conservation policies that could affect almost any type of business. Some additional difficulties would include limited access to resources on the island, long wait-times for shipments, slow communication within the business community in general (i.e., processing applications, waiting for responses for requests), and lack of enthusiasm among Hawaiian companies and individuals to embrace and support non-Hawaiian-run businesses.”
The couple’s advice is that anyone interested in starting a business in Hawaii must conduct significant research on that industry, specifically in Hawaii, including competitors, the rate of success, and policies that may impact starting and operating that business. “Very early on in the business development, I would advise joining the Small Business Association (SBA) and connecting with as many other local business owners as possible. It would be very helpful to establish a friendly and responsible reputation with local leadership and any long-time Hawaii-owned business owners connected to your industry. I would also suggest getting to know and understand your audience in Hawaii and finding ways to connect and become relatable to them,” alerts Lindsay Colle.
The yoga teacher Alessandra Lopes, who moved to Hawaii in 2009 from California, created an outdoor yoga class on Waikiki Beach called @2FBeachpParkYoga with her partner, Tomoko Udakaneta.
Alessandra started working with yoga in 2015 in a yoga program for children at a school in Honolulu, where her daughter studied. “At one of the schools where I taught, the coordinator asked me if I could do a class for the teachers and school staff. From there, I felt the need to have an open class that anyone could join, without having to be part of a studio or a certain school or company,” she says.
Her audience usually consists of locals mixed with tourists from Japan, Canada, Europe, the United States, and local Brazilians. With the pandemic, all the tourists disappeared, and the park where she teaches closed twice.
In the first lockdown, Alessandra spent two and a half months without teaching. A second lockdown soon followed. Even when she could teach, her students were scared, and only a few local people were practicing. All the schools where she taught closed, and she had to stop courses for the students mid-semester. One of the solutions she used to move forward was to reinvent herself and start using online platforms to promote and teach yoga.
“I was never a technological person or liked to use social media frequently, but I had to learn that technology. My friend helps me connect with people so I can share all the knowledge of yoga and spread the spirit of Aloha with as many students and people as possible.”
It turned out that the internet was her great ally, and she not only kept her yoga classes in the park but also created new projects, such as her new yoga course on Facebook, where the client can subscribe with their email and get a free practice of Yoga Nidra – Yoga for better sleep. She also created her YouTube channel, Alessandra Yoga Hawaii, with meditations and even invested more in her Instagram @alessandra_Yogahawaii_ and Yoga in the Park Instagram @2fbeachparkyoga.
She remembers that in life, everything changes, nothing stays the same, and you must live one day at a time, always keeping faith, positivity, and hope that today can be a good day. “I’ve been through challenging situations in 20 years in America, but anywhere there will always be some difficulties. Nothing is perfect, and what makes the difference is persisting in your dreams by adapting to reality.”
The Hawaii Small Business Development Center (SBDC) says small businesses comprise a significant part of Hawaii’s economy. According to the Small Business Administration’s 2022 Small Business Profile, Hawaii has 141,460 small businesses, accounting for 99.3% of the total businesses in Hawaii. Customers also support about 49.3% of Hawaii’s total workforce when shopping locally. Interim State Director Joseph Burns says small local businesses create and maintain jobs and make a substantial contribution to the tax base, which in turn supports government services that the community relies on.
He also highly recommends that newcomers follow these 12 steps to help the transition without many hiccups along the way:
- Find a business idea that can succeed locally.
- Research the right island for your business (and your lifestyle).
- Decide if you can handle the high cost of living.
- Make sure your business name is available in Hawaii.
- Figure out your business’s structure.
- Create a free account on eHawaii.gov.
- File your articles of incorporation or organization.
- Determine if you need a registered agent.
- Pay your non-refundable filing fee.
- Open a business bank account.
- Get an Employer Identification Number.
- Obtain any additional business licenses.
Bottom line
Starting a small business is a big lift, whether on Hawaii or the U.S. mainland. However, after your idea is off the ground, you can turn it into a reliable way to boost your bank account and supplement your Social Security once you retire. Furthermore, with some planning and thorough consideration of the pros and cons, you can even make your dream of loving life in your own tropical paradise a reality.
