Mistakes to Avoid When Starting a Business in Seychelles

Published on September 30, 2025 and written by Cyril Jarnias

The Seychelles, with their white sand beaches and crystal-clear waters, are attracting more and more entrepreneurs eager to leverage an idyllic setting to grow their businesses. However, starting a company in this tropical paradise comes with its share of challenges. To maximize your chances of success, it’s crucial to avoid certain common mistakes that could jeopardize your venture. Here is a comprehensive guide to the pitfalls to avoid and strategies to adopt for launching your business in the Seychelles with peace of mind.

Sloppy Preparation: The First Step Toward Failure

Planning is the cornerstone of any successful business. Unfortunately, many entrepreneurs underestimate the importance of this crucial step when launching in the Seychelles. They get swept away by the appeal of the paradise-like setting and neglect the practical aspects of their project.

A study conducted by the Seychelles Chamber of Commerce reveals that 40% of new businesses close within the first two years, mainly due to a lack of preparation. To avoid this fate, it’s essential to develop a solid business plan that takes into account the specifics of the Seychellois market.

Your business plan should include an in-depth analysis of the local market, a marketing strategy adapted to Seychellois culture, and realistic financial projections. Don’t forget to incorporate specific costs related to the island setting, such as import fees or high electricity rates.

A thorough understanding of the local economic environment is essential. The Seychelles has a unique economy, heavily dependent on tourism and offshore financial services. Make sure you understand seasonal dynamics and market trends before diving in.

Finances: A Delicate Balance Under the Tropical Sun

Financial management is often the Achilles’ heel of new businesses in the Seychelles. The high cost of living and seasonal economic fluctuations can quickly strain an ill-prepared budget.

According to the Central Bank of Seychelles, 35% of business bankruptcies are due to cash flow problems. To avoid this trap, it’s crucial to have sufficient capital from the start. Experts recommend having at least 12 months of working capital to handle unexpected events.

Taxation in the Seychelles may seem attractive at first glance, but it has its subtleties. While the country is known for its favorable tax regime, especially for offshore companies, there are obligations to meet. For example, local businesses are subject to a 25% corporate tax on their profits.

It’s also crucial to understand the different types of business structures available in the Seychelles and their tax implications. An International Business Company (IBC) may benefit from tax exemption but is subject to restrictions on local activities.

Currency management is another aspect not to overlook. The Seychelles uses the Seychellois rupee (SCR), but many transactions, especially in tourism, are conducted in dollars or euros. Make sure you have a foreign exchange management strategy to minimize risks related to currency fluctuations.

The Regulatory Maze: A Challenge Not to Underestimate

Neglecting regulatory aspects is a fatal mistake for many entrepreneurs in the Seychelles. Although the country has made efforts to simplify administrative procedures, the legal framework remains complex and constantly evolving.

The Seychelles Investment Board reports that 20% of new businesses face major difficulties due to a poor understanding of local regulations. To avoid this trap, it’s essential to familiarize yourself with the laws and regulations specific to your industry.

Obtaining the necessary licenses and permits can be a long and tedious process. For example, if you plan to open a hotel or restaurant, you’ll need to get approvals from the Ministry of Tourism, the Public Health Authority, and potentially other government agencies.

Employment laws in the Seychelles are particularly strict. The country has implemented quotas for hiring foreign workers to protect local employment. Make sure you understand these rules before building your team.

Environmental protection is a national priority in the Seychelles. If your business has a potential impact on the environment, you’ll need to obtain authorization from the Ministry of Environment and Energy. Penalties for non-compliance with environmental standards can be severe.

Competition: An Opponent to Take Seriously

Underestimating the competition is a classic mistake made by new entrepreneurs in the Seychelles. Despite the small market size, competition can be fierce, especially in tourism-related sectors.

A study by the Seychelles Chamber of Commerce shows that 30% of new businesses fail due to poor assessment of the competition. To avoid this trap, it’s crucial to conduct a thorough competitive analysis before launching.

The Seychellois market has its own particularities. Local consumers are often loyal to established brands and may be hesitant to try new products or services. Additionally, the seasonality of tourism can create intense competition during peak periods.

Remember that your competition isn’t limited to local businesses. Many multinational companies are present in the Seychelles, especially in tourism and financial services. These companies often have significant resources and strong brand recognition.

Innovation and differentiation are essential to stand out. Identify market gaps and offer unique solutions that meet the specific needs of Seychellois consumers or tourists.

Winning Strategies to Thrive in the Seychelles

To maximize your chances of success in the Seychelles, it’s crucial to adopt a proactive and strategic approach. Here are some tips to turn challenges into opportunities:

1. Cultivate Your Local Network

Networking is particularly important in a small island economy like the Seychelles. Actively participate in local professional events, join the Chamber of Commerce, and build relationships with key players in your industry.

According to a survey by the Seychelles Investment Board, businesses that actively engage in the local community are 40% more likely to succeed in the long term. Don’t hesitate to collaborate with other local businesses to create synergies and expand your customer base.

2. Bet on Sustainability

The Seychelles is at the forefront of environmental protection. Integrate sustainable practices into your business model to align with local values and attract an increasingly eco-conscious clientele.

The Seychellois government offers tax incentives to businesses that adopt environmentally friendly practices. For example, you could benefit from a tax reduction of up to 15% for using renewable energy.

3. Train and Value Local Talent

Investing in the training and development of local employees is a winning long-term strategy. Not only will this help you meet local employment quotas, but it will also strengthen your image and roots in the community.

The Ministry of Employment and Social Affairs offers support programs for vocational training. Take advantage of these initiatives to develop your team’s skills and improve your productivity.

4. Adopt a Flexible Approach

Flexibility is essential to adapt to the specifics of the Seychellois market. Be ready to adjust your offerings based on customer feedback and market developments.

For example, if you’re in the tourism sector, consider diversifying your services to attract local clientele during the off-season. This could include special offers for residents or community-focused events.

5. Leverage Technology

Although the Seychelles is a paradise destination, it’s not lagging in technology. The judicious use of digital tools can give you a significant competitive advantage.

Invest in a strong online presence, including a mobile-optimized website and a targeted digital marketing strategy. According to the Digital 2023 report for the Seychelles, 79% of the population uses the internet, offering significant potential for e-commerce and digital marketing.

In conclusion, starting a business in the Seychelles offers many opportunities but requires meticulous preparation and a deep understanding of the local environment. By avoiding common pitfalls and adopting a strategic approach, you can turn your entrepreneurial dream into a prosperous reality under the Seychelles sun.