Are you thinking of opening a business in Dubai? Here are the top 3 dos and don’ts that you should be bearing in mind before you open your own startup in Dubai.
Top 3 Dos to Open a Business in Dubai
Choose a local (UAE National) sponsor for local business startup
There are various business opportunities in Dubai, as well as in the other Emirates of UAE. However, if you really want to start a business which must exploit the potential of Dubai then you need a locally registered LLC business. A UAE national must be taken as a 51% partner who is called a local ‘sponsor’. A local company provides the freedom to locate a business anywhere in the city. For a business startup in Dubai, this is a boon because it affords the best choice of locations to suit your budget. A sponsor must be paid a yearly fee which can be negotiated. Do develop a rapport with your sponsor so that he is ready to help you in sorting out any problems you may face along the way with authorities.
Want to own 100% of your business? Choose a Free Zone
Keep in mind that the only way for a business startup in UAE to start without taking a UAE national acting like your partner is to locate your business in one of the Free Zones. This is not practical for businesses that must be in city markets like restaurants and retail stores. Also, businesses that work with the government have to be registered with a local sponsor. Not to mention the fact that purchase or rental in a Free Trade Zone district might be high for your budget to handle. For a business startup, Free Zones offer three great advantages like 100% ownership, speedy startup, and duty-free customs boundary.
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Pick a location that optimizes suitability, convenience, and costs
Another important step in planning a business startup in Dubai is to determine the most suitable location for the business. Setting up a profit-based enterprise in the city wouldn’t do you much good despite the growing economy if you’re customers or clients can’t reach you. You need to set up your business in an area that is most profitable for your business or most convenient to your business. A location in the right city can be selected for a shop or an office is most known for the type of product or service you are dealing with. If you are planning a Free Zone company then you must make the selection based upon the criteria of distance, costs and if it is suitable for your product, business model, and trade requirements. A tenancy contract must be concluded. If you’re aiming to start a small-scale enterprise, then the basic amenities, like telecommunication, storage, and space inside the establishment is the basic concern that must also be satisfied. Other services available in the commercial property can vary greatly.
Top 3 Don’ts to Open a Business in Dubai
Don’t choose a license category randomly, it should be matching with your business model
In the UAE, it is not difficult to devise a business model that will not need a change. Very often much change or at least some tweaking is needed. Make wide possibilities and confirm whether your planned license category allows you all the activities that will be likely in the business model you are planning. Do not choose a license category that is too narrow.
Don’t open a bank account without confirming the charges
Banks levy varying charges. For a business startup, these can amount to a substantial sum for a bank-dependent operation. Always confirm the requirements and charges beforehand. Do not choose a bank based on only the reputation.
Don’t rely on published information only
Before you finalize the plans for your business startup it is prudent to confirm the validity of the published information. Rules change in Free Zones and also in the local Department of Economic Development for business registration. Do not go ahead until you have confirmed your assumptions through a business set up consultant, or by actually contacting the relevant authority. You may discover that some papers may be needed or that some nationalities need special permissions or that some requirements may be waived if you request or negotiate.