Ep 2: How to Start a Hotel and Restaurant in Indonesia | Alejandro Pineda

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Alejandro Pineda – MD Kumbara Villas and Director of The Mexican In Town

In this episode of The Indonesia Hospitality Podcast, Alejandro Pineda takes us to his journey on finding his home in Indonesia. Stories of success, passion, and challenges that nourished his experience in this wonderful land and the people that he met who make the hospitality industry in Indonesia world class. Whether you’re a veteran in hospitality, a seasoned investor, or someone looking for a sea change in life, this podcast covers everything that you need to know to inspire your next move in Indonesia.

Episode Timeline

Trip to Sumbala

1:05

“I have been looking forward to some time off some downtime to reassess. COVID has been the perfect situation for me to have precisely that. So yes, I’ve been obviously surfing a lot, which is which is really great. Because it’s one of the things that brought me here. It’s probably the main thing that brought me here to Indonesia”

Living in Indonesia

1:48

There’s also the connection with the people, it almost feels like things become a bit more meaningful when to us and to them when we are in times of struggle together. They see you here on the good times, but they also see you here on the bad times.

02:37

I didn’t choose Indonesia, but Indonesia chose me. I came here on a surf trip with a plan to go to Bali and Sumatra and stay here for about six weeks. I was just blown away by it. As I arrived in Bali, I thought I was so different to what I had expected. I had expected like pristine Virgin Islands. I somehow expected it to be a lot smaller than it is. I was quite shocked, it is quite urban. But it had a really beautiful charm in the culture and the people and in the vibe of the travelers.

3:30

Lombok really gave me what I was expecting from Indonesia as a whole. The pristine beaches with no one the feeling of exploration and discovery.

3:43

Things just started happening around me.  Met some people that were looking to develop things. I really saw the untapped potential of the island and 10 years later, I am here doing what in that moment became my dream.

How His Profession Helped Him with His Decision to Live In Lombok

4:58

I had no idea how difficult it is to actually achieve moving here much less back then. Interestingly, I met a person who has a resort and he had a land sales of property, a property business going. He became interested listening to my story on the fact that I was actually a real estate lawyer. He introduced me to some of his clients and his clients were looking to develop a property. That’s how we got in touch with the guys that later became my business partners. Together, we developed a pretty large development project that was basically my, I call it my scholarship to staying here.

What Made Alejandro Decide to Settle in Indonesia

6:31

I just have this gut feeling this intuition that that this place was for me, and that things would happen. There was absolutely no logical certainty in it.

6:59

It’s like that beginner’s ignorance of not even grasping the challenges. I just wanted to stay here and I needed to figure out how. Rather than focusing on the challenges, I focused on myself and my self-growth and took everything from a beginner’s perspective, and just completely opened up to absorb as much knowledge as possible about the area and to shake myself into the person I needed to be in order to succeed here.

Is it sometimes better to jump in to investing into Indonesia when you’re younger?

8:28

As a young as a fresh graduate lawyer, it’s not like you’re sitting in the fortune. I didn’t come here with an investor mindset. I came here with a working mindset. The craziest part of it all is I didn’t really reflect on how things would work for me financially on the long run. It wasn’t until like year two or three when it really hit me. If I stay here any longer, I may not be able to go back to my law career. Such a strict upward ladder in law. If you’re not climbing, you’re falling.

9:16

At this point, I really believed in the projects I am doing. I really believe in myself. I had seen myself go from not knowing anything about the place to being quite familiar with the area. And I kind of placed myself in the hands of the project I was doing developing, I didn’t really look back much because it was scary.

How has Alejandro’s relationship changed with the locals since his first arrival to now?

12:12

I met many of these guys like we are neighbors and live together. I had met them 10 years ago. So they were in their teens or in their 20s. And now they’ve grown to have businesses of themselves. It is quite amazing to see the development of people here in terms not only of financial growth, but as personal growth. You see very talented photographers, DJs, local people starting much more interesting restaurant concepts. There’s definitely been a significant level of change brought in by tourism and development and investment into the area.

What did Alejandro miss most when he moved to Indonesia?

14:38

I obviously missed home. I miss my family. Around year two or three, you start to really ask yourself a few questions. One of the things I realized I missed a lot were barbecues like Saturday, Sunday feeling and your usual weekday. Just sharing with friends, the fact that we all had time off at the same time and getting together. That was different here.

What does Alejandro know now about life in Indonesia that he wishes he knew back then?

Every stage of a person’s life has a value. There’s tremendous value in what we look back into as mistakes. When you’re busy with what’s around you, you often forget the fire burning within. I came to a point where I completely lost track of why I came here. I kind of thirst for security, for establishing myself here, and kind of made a complete parallel with life at home.

Three tips for purchasing land in Indonesia

19:41

#1 Understand the context of where you are and where you’re investing. You’re investing in areas of land that has been very reasonably populated. I came to understand this through communicating a lot with local people.

#2 If it’s possible for you to buy from families directly, this is a better way and get to know them and get to understand basically their family tree.

#3 Always privileged land that has clear signs of ownership, like fences and defined boundaries.

Bonus tip: Get in touch with the local community of expats. There’s a wealth of information in every expat community

How do you find a good lawyer in an area that’s underdeveloped?

24:16

It used to be very difficult to find good legal consultants. I think the task is getting easier. Again, speaking to the expat community and finding out who they trust is important. When people come they communicate, they can find who the better consultants are. And nowadays, you can get some better advice.

Tried and tested methodology that everyone should be applying to their projects

25:41

Always start slow. Divide everything into smaller pieces. When you act a little bit slower and more cautiously, at first, you have much better chances of succeeding. This will give you more time to bond better with the community.

Approaching business with an open heart? Is it reciprocated or taken advantage?

30:32

Being authentic to people and giving people a chance and opportunity is the way to go. My methodology is to start small, like give people small trust, small incentives and small actions. This is how you develop a network over time.

31:21

It’s important to keep an open heart, give people opportunities, and if they fail you don’t take it personal.

Ways to motivate staff to be better

33:04

The most important asset for me in a person, and this goes all the way to management is that I see in them a will to learn with a beginner attitude. I don’t really motivate my staff to want to be better. I choose staff, who I see in them the desire to be better.

33:28

What I tried to continuously do is to become a vehicle for them to grow through and stay open to their shortcomings.

Operating a Hotel without Digital Collaterals (Websites, Email)

 35:58

10 years living in a remote island change you a bit. I guess it’s the fact that I rarely sit behind the laptop. I made a point in my life to not want or have to live a life where I need to sit in an office behind the laptop most of the time. We have completely replaced email in my businesses with WhatsApp.

37:19

I find it a little bit useless to have a website. We have booking agents. People who want to stay in our hotel nowadays mostly check through your Airbnb or go to booking.com. So it’s important to have a good presence there. And social media is the new website. People are browsing through and pumping their feeds. And that’s how they find you.

Learnings about hospitality in the last year

38:36

Villas have performed best of all better than restaurants and better than normal hotels. Because as prices have reduced, a lot of people are staying here more long term, a lot of restaurants have closed. So people are looking for a villa where they can go do their shopping, and they can cook their own food. And also take advantage of the fact that prices are really good.

Will your hotel business model change as a result of COVID?

41:17

There’s massive level of uncertainty at the moment. We don’t know if things will go back to normal things like business as usual or not. It’s very important to stay open to be flexible.

41:53

As things recover, we’re going to see if there’s going to be a full recovery or a partial recovery. And that’s when business models will be adopted. But for the moment, other than the new sanitary conditions, new normal conditions, there’s not much else

What tactics are you planning on deploying?

42:46

From a health sanitary perspective, we’ve equipped them with obvious masks and gloves, we’ve done an education on being very careful to wash their hands regularly.

43:34

When it comes to the restaurant, there’s more risk definitely involved in restaurants. We disinfect tables, as soon as people leave. And again, try to keep enough separation.

Ensuring the staff are working to the highest standard

45:18

Make sure to be constantly checking by yourself. We’ve set a variety of different systems to keep everybody accountable. Specific staff are responsible for specific areas of the resort. There’s a checklist of what they need to do and how they need to do it. They need to check that they have actually done it and they need and then they need to call in a supervisor.

Started as a Vision now Turned into Reality

48:02

I was sitting trying to figure out what to do. My partner was really into cooking, and we would do Mexican food at home. It had always been my dream to being born in Mexico. And growing up with this really good food. Living here. I missed it quite a lot. So we would cook and then the idea slowly came about to open a restaurant that would bring this experience to people.

48:57

My partner convinced me. And she knew my mantra and she convinced me to start small. That’s that’s what we did. We started out with a little food cart. The town at the time back in 2015 was so tiny. Any new food option was highly welcome. Turned out the food cart did really well. Slowly but surely we grew the business from a small food cart to tables to a quite full blown restaurant operations. We now have around 80 seats in the House.

Learnings about the Restaurant Industry

50:23

My experience in the restaurant industry started when I was a kid going to a lot of restaurants. I’ve always loved food. And I’ve always had a passion for quality food and service. I always dreamed of having a restaurant. I’ve learned that passion is extremely important. And it’s very important to keep it. The soul of a restaurant is the passion behind it. Always wanting to come up with new things. Never settling for just being good. Always looking at ways to improve and truly enjoying the process of becoming better.

51:33

Second very important element, which is something I applied to all of my businesses is to have really concrete, simple processes. The more you can simplify your processes, the better you can hand out people their responsibilities and hold them accountable for them. The more mechanical processes become, the easier it is to have a consistent quality. It’s a mix of passion for the development of things for new flavors, for new experiences, and then marrying that with very systematic follow up when it comes to the systems to implement it.

The Importance of Sourcing Ingredients Locally for their Restaurant Dishes

52:49

When we started five years ago, we live in a pretty remote area. So if you wanted to go do your shopping, you’d have to drive one hour. We did the reverse logical thinking of let’s adapt our menu to what’s available. There were some specific Mexican staples that we required. And that was a very important part of the initial sourcing. But then we pretty much designed our menu around what was available here and what was easy to execute with consistent quality.

What should listeners be aware of in designing their restaurant space?

55:32

Every change responded to a need. So as we were operating, we would see a need, and we would grow into it.

56:20

if I were to give advice to people who are designing a space nowadays is just design something that is fresh and attractive, that has a character of its own.

What does Lombok look like for you in 50 years time?

58:09

What I’ve seen in in Lombok this far is more and more people coming in with a passion and with creativity, doing boutique, highly passionate projects. It speaks that the town is developing as a town which is full of little gems, cafes, hospitality, accommodation, there’s a lot of passion in in in the people that are doing business here.

58:56

My hopes would be that inevitably, when big businesses come with a little bit of an intuition for what’s already here, they are passionate businesses that are ecologically conscious. I would like to see that particular sustainability trend continue over time and increase. People come here for the natural beauty of a place and I think it’s incredibly important to try be as sustainable as possible and as little impactful as possible in the local culture and the environment. I think it’s our responsibility to keep the place green, beautiful and clean.

Who do you think would inspire other people in the hospitality industry in Indonesia that I should interview after this?

1:00:06

One of the people that have really inspired me over time, even though she’s more in the circumference of the hospitality industry more in the architecture and sustainable development arena would be my good friend, Paula Huerta. She’s such a passionate woman, she’s really inspiring. Not only does she have like 700, design projects and construction, but she’s also really, really focused on sustainable development. And she’s been working in close cooperation with the local governments in creating composting facilities

Key Quotes:

07:07-07:31

“I just wanted to stay here and I needed to figure out how. Rather than focusing on the challenges, I focused on myself and my self-growth and took everything from a beginner’s perspective, and just completely opened up to absorb as much knowledge as possible about the area and to shake myself into the person I needed to be in order to succeed here.”

30:32-30:46

“I think being authentic to people and giving people a chance and opportunity is the way to go. I wouldn’t like to be walking around with a heavy armor. It’s heavy and exhausting to be always protecting yourself.”

31:45-31:51

“Just make your learnings as cheap as possible. The expensive learnings are the ones you want to stay away from”

35:28-35:42

“You need to be humble yourself and understand that it’s going to take some time and things slowly start to gear up. And then you start to create a culture within your business and things start to work the way you like it. That’s when all the satisfaction comes.”

1:01:26-1:01:43

“Things are going to be different for everybody. Times have changed, budgets are different. Personalities are different. I think the most important piece of advice I could give anyone is come here with an open heart. Be intuitive, and enjoy the ride because if you’re not enjoying it, you’re in the wrong place.”

If you enjoyed this podcast and you’d like to help support the podcast, please share it with others post about it on social media or leave a rating and review. For the show notes and links to information we discussed on the show today, simply head to our website https://indonesiahospitality.com/

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