Are you setting up a business in the UAE?
If the answer is yes, then you must plan everything well, because Dubai is currently leading the list of the best places for start-ups, and there are many things that you must know about the entire process.
The United Arab Emirates has been a major destination for investment in business ventures for years. In addition, the city is a work of art that combines diverse cultures with a great standard of living that is simply convenient to other parts of the globe. Besides, the World Bank notes that the United Arab Emirates, with a GDP of US $ 421.4 billion, has been subject to international investors for years. Support hundred percent foreign holding of financial operations, investment-friendly insurance policies, and more visas for highly experienced people.
Also, the UAE has brought in better connectivity with Asia, Africa, and the Middle East, and empowers more bonds with business hubs in Europe and the US. Permits multinational businesses to invest in the United Arab Emirates and begin the business. Also, tax facilitation, power availability, tax benefits, securing permits, and contract enforcement make UAE a great place to stay and do business.
Besides, more profitable business possibilities in the UAE include gold trading, real estate, restaurant, e-commerce, and fintech.
Some of the most important factors that you must know before establishing your business in Dubai are:
Find out the cost of setting up a business
In addition to the company’s capital investment, it is required to begin a business in Dubai. A business setting in Dubai can include some running costs and government charges in addition to the investment for the business only. Primary company set-up costs include business licenses, government certifications, trade name registration, visas
Learn the difference between the mainland, free zone, and offshore
Company Formation in Dubai is split into three major jurisdictions -Mainland, Free Zone, and Offshore. These domains are categorized according to the business conditions, the commercial venture, the level of ownership, the imposition of the tax etc.
Learn the legitimacy and paperwork
The UAE market specializes in legitimacy, contracts, paperwork, and documentation. Any lag in the before-mentioned may result in big fines for the company. So it is good to know your legitimacy
Know your incorporation process and licensing steps
An understanding of the new place, currency, trends, etc. attracts a lot of attention, in which the integration process and licensing are entirely ignored. Incorporating a trade license is a big process that stops companies from obtaining business licenses that do not meet their requirements or allow them to perform particular actions, so recognize the integration process or ask an expert who provides Business setup in Dubai
Know that time is precious
Consider the opportunities from the start and do not lose time once the company setup has begun. Time is important, and elongating or slowing the process will raise the cost of establishing the company.
Know that you are on the cultural boundaries
There are cultural differences and you have to be open to them, and should consider the cultural boundaries. Recognize local and subculture diversity, Understands local business systems, Adapt business models to the UAE market and management methods, Identify new opportunities in the Market
- The employee visas are the responsibility of their company.
- The Fridays are generally off and many companies also have a 5-day week
- It is important to work with some consultant that can help you a lot in the entire business documentation process
- The mainland zones don’t allow 100% ownership rights to the foreign business owners. You need a local sponsor for opening a business in the mainland business zone and you have to pay an annual fee to him or her.
- You must obtain a business license in Dubai that might come with different fees for different types of businesses.
- While you are the 100% owner of your business in the Free Zone, you are not allowed to participate in trade activities with the mainland businesses.
Now, let us move on to dig deeper and learn more about starting a business in the UAE.
Begin with a business plan for ensuring trouble-free run – What is a business plan?
A business plan is a written document that acts as a roadmap for a business, usually a start-up. It defines the business objectives and the processes a business owner is going to follow to achieve his business goals. Technically speaking, a business plan is a well-defined roadmap for almost all types of business activities such as marketing, financial planning and operational management.
What makes a business plan so important?
A well-formed business plan can not only help you identify any weaknesses in your business idea but it can also help you address them efficiently well before you proceed with the setup. A professional business planning executive can help you recognise hidden business opportunities that you can explore, and guide you with the entire process of setting up your start-up.
He can also analyse the market and your competitors to help you devise a strategy for operating with an edge over them. The business plan also offers actionable insights into your understanding of the business and can also inform you whether your business is going to be a successful venture or not.
Whether you are beginning a small company or investigating ways to develop a current one, a business plan is an essential tool to ease your choices. Consider it as a roadmap to achieving that provides you higher accuracy on all phases of your company, from marketing and finance to services and product details.
While some owners may be tempted to go directly into startup mode, writing a business plan is a critical first step in examining the viability of a company for budding administrators before investing further considerable time and money. A business plan aims to support you expressing a policy for lighting your business. It additionally supplies you with the steps to take, the supplies needed to fulfill your business goals, and a timeline of the required results.
For enduring small businesses, a business plan should be refreshed annually as a method to drive growth and drive to new businesses. Your strategy should involve clear intentions for choosing new employees, business analysis, financial estimates, and potential investors. Objects should indicate how they will benefit your business to grow and improve.
Hence, a business plan is a must-have for every start-up.
Why do you require a business plan for your start-up?
When it comes to the “Why” of having a business plan, there are three major reasons to do so.
- If you are planning to launch a start-up in UAE it is highly likely that you will be requiring funding or a loan from a bank. In both cases, you are required to submit a business plan that can be attached to your loan application. This is done to ensure that the money is being attached with a promising source of earning.
- If you are a foreigner who is planning to set up his start-up in Dubai, some free zones ask for a business plan document as a part of the application process.
- Further, if you are a local citizen who is planning to establish his start-up in a free zone or any other area, you might be required to submit a business plan document for various purposes, such as obtaining a trade licence etc.
After a detailed understanding of the importance and need of a business document, let us move on to find out how you can write a business plan for your start-up.
How to write a Business Plan for your start-up in Dubai, UAE?
Take a look at the steps of writing a business plan for a start-up in Dubai. Although you may have written a business plan earlier, realize that the UAE has a few format conditions connected to Western nations, so it requires to be researched more accurately. Follow them and ensure that you consult some reputed professional that can help you write a suitable business plan for your needs and business type.
#1 Ensure business compliance
It is mandatory for every business to be compliant as per the norms and regulations of the government. Hence, your business plan must show that all the business activities of your company will be compliant with the regulations. Your business description must show that the operations are legal and permitted by the government and local governing body within that free zone. The compliance section must also clearly indicate that the free zone you are opting for your business has space and infrastructure required for your business.
#2 Purpose of the business plan
The UAE government forbids you from using a ‘generic’ business plan for a start-up, or otherwise. Your business plan must be tailored to cater to a specific audience or customer base. For example, if you are planning to open a chocolate factory, you have to clearly mention the target consumers.
Further, your business plan must clearly indicate its purpose. For example, you have to clearly point out the purpose of your business plan – whether it is being used for seeking business investment, or for gaining entry in a free zone, or for submitting to the business shareholders.
#3 Your business plan must be a result of in-depth research related to your business idea.
When you open a start-up, you conceive an idea and the rest of the things are spawned from it. Then you see whether there is a valid and profitable market for your business and whether you can actually make an earning from it. You also study its impacts and conduct tests or other mandatory procedures to ensure that your products are harmless to your audience.
As a lot of effort goes into the entire thing, your business plan must reflect the same. It must contain detailed research and test descriptions and their results. UAE is even more particular than many other countries when it comes to the details mentioned in business plans. So, do your work and make sure to include commendable and credible sources of data and information to make your plan more concrete.
#4 Thorough financial planning
You cannot play with words when it comes to financial planning and working of your business. Your business plan must show realistic and thorough financial details for your company and also comprise relevant projections for finances in future. Instead of being impulsive while showing the future projections, we recommend showcasing the highly likely and highly unlikely scenarios as well.
#5 Follow the business plan templates, if available
Many free zone areas have their own business plan templates that you must follow. They have a clear format and you have to simply enter the details. These templates make it easier for you to submit the information in a way that the governing bodies are well-versed with. So, stick to it and make sure you don’t skip on any important field to avoid rejection of your application.
This completes our discussion, and we hope that all our readers find it helpful for starting their start-ups in the UAE.
A business plan aids you to learn if your entrepreneurial approach has potential, helps you develop your business plan, and is usually essential for reaching funding. If you are thinking to begin a business in UAE, possessing a business plan is much better. Having a business plan is a necessity, without which you cannot begin your own business.
Making a tax-free business in the United Arab Emirates is apparently a lifetime chance! Nonetheless, you will quickly notice that this process is not like developing a business in the US or Europe, just as a businessperson you have adequate relationships to expedite the process, writing a business plan for a Dubai startup.
Besides its social differences, Dubai is known for its foreign-investor-friendly convenience, which is as reasonable and acceptable as anywhere else. That being said, our post covers some of the things you need to know about planning a flourishing business investment in Dubai.
For more information and expert guidance, you can reach out to us in the comments section.