8 Things You Should Consider If You Are Planning To Start Your Business in 2020
Nothing can really prepare you for starting up a business, especially in a busy place like Dubai.
It is going to hit you like a storm if you do not really figure out the whole process, plan your finances and get some good advice.
It is no secret that Dubai is setting up the stage for Expo 2020 for which over 190 countries have already confirmed their participation. This makes it one of the most inclusive Expo’s to have ever been organized. With the expo happening there will be a lot of changes in the economy of the country and there are many factors that need to be looked into before starting a business in Dubai.
Some of the factors are as follows:
- Determine the idea and the type of business
- Choose the right activity
- Choose the right type of company
- Choose the perfect location
- Choose the correct bank
- Be ready for Expo 2020
- Staffing
- Marketing
- Payment and logistics
Determine the idea and the type of business:
Nobody can start a business without a good idea. Your idea may not always have to be out of the box but it is how you execute it that matters. Your idea has to give a solution to people’s real-time problems. Once you decide on your idea the next most important thing is setting realistic expectations for yourself. You need to decide if your company will be solely owned by you or if you wish to partner up with someone, or go public and raise capital through shares. In case you are planning on being the sole owner you should look into setting up your business in one of the tax-free zones in the UAE. It is only in these zones you can fully own a business without an Emirati partner.
Choose the right activity:
One of the most important things you have to do is choosing the kind of activity your business will be doing once it starts running. Choosing the right activity while setting up your business in Dubai is very important than in other countries. You may ask why? It is because each activity you do requires a separate trade license which is why it is important for you to list down your activities at the start and get the correct trade license for that. If you decide to do something additional after the trade license has been issued to you then you will have to pay more to get a trade license for the new additional activity. For example, if you have a trade license for a restaurant you cannot start a catering business under the same license. You need to get another license for that.
P.S – There are certain activities that are regulated and require special permission from the governing bodies. For example the medical industry.
Choose the right type of company:
There are different kinds of activities a business can choose to do and depending on that they form their business model. Now, based on the business model there are different ways to set up your business.
There are three options:
- Local LLC
- Free Zone Company
- Offshore Company
Local LLC – If you are focusing on supplying goods or services to the local markets in Dubai then you will need a Local LLC. These kinds of companies will always have an Emirati as a partner who owns 51% of the shares. You will also require a Local LLC if you want to rent a warehouse or office outside the tax-free zone or in one of the malls.
Free Zone Company – Free zones companies are located in the free-zone areas in the UAE. If you are looking at 100% ownership then this is what you must be opting more. Not just 100% ownership these companies enjoy a whole lot of other perks too, like exemption from corporate tax, full repatriation of capital and profits, minimal export/import duties, no restriction on currency movement, single-window clearances for administrative services…etc. If you are looking at setting up your business in a free zone, DAFZA is one of the key locations you must look at. The can be a lot of reasons why so many businesses are operating from DAFZA. Some of them are state-of-the-art infrastructure and added amenities provided, the luxury of 24/7 security, 24/7 customs services, rapid cargo clearance…etc.
Offshore Company – If you want to do business with the rest of the world but have your base in the UAE then this type of company is the best for you. This lets to have a company in the free zone but you will not be able to do business within the UAE.
Choose the perfect location:
Location is another important thing that you have to consider while starting a business in the UAE. Does your work require you to have an official workspace or can you work from home? If you do need a workspace is it good enough to receive your customers for a meeting? Not every free zone has the same facilities so you have to make sure you choose the correct place. As per the law, every company registered in the free zone needs to rent out an office space or a warehouse and to comply with this law some of the free zones provide you with a Flexi desk. This is a workspace where you can work from, it can be a co-working space where various other entrepreneurs will also be there. If your kind of work requires an office then you want to be located in a nice building in a central location where transportation facilities are available. If you are a trading company then you want to be located somewhere near the port.
Choose the correct bank:
The UAE has a lot of good banks and offers a wide range of services that you may not receive anywhere else. Banks here also offer Sharia financial services where you will have to split the profits rather than paying the interest. In terms of starting a bank account, it is one of the easiest things to do in the UAE. Foreigners without a residence permit can also open corporate or personal bank accounts in Dubai.
Be ready for Expo 2020
As of now, the countdown is on and the city is getting ready for the next big thing, EXPO 2020, but if you are planning to start your business in 2020 then you have to be ready for it. It is expected to attract 25 million visitors over 6 months and this will for sure create a wide range of business opportunities that you can capitalize on.
Staffing:
If you are a B2B company then you need to have a strategy set to handle the sudden increase in the number of visitors to Dubai. You need to consider if your staff can handle the multicultural people coming and if your staff can cater to their needs. You also need to consider if you have enough staff to handle the sudden surge of clients.
Marketing:
As a business, if you have decided on your final idea, what type of business it is going to be and if your business provides a solution to people’s real-time problems the next thing you should be focused on is how you can market it. As of today, online marketing is a great option but there are a lot of mediums online to market your product and the key lies in choosing the right one for you.
Payment and Logistics:
When it comes to payment businesses may not always pay you in cash. Will you be able to cater to the various other ways like UnionPay, cryptocurrencies, or the old fashioned traveler’s cheque?
Your clients can be far away from you and would want your products shipped to them. Have you connected with a logistics firm that can help you with this? Have you worked out the finances for it as this can sometimes go beyond what you expect?
If you are looking at starting a business in the UAE, DAFZA is one of the places you should look at. They are one of the most prestigious and advanced free zones in Dubai. They provide an ideal base to do business in the middle east by providing a business-friendly environment, world-class infrastructure, tax exemptions, full repatriation of earnings, total ownership, and exceptional facilities. Strategically located next to the Dubai International Airport, they boast rapid clearance and fast processing of paperwork to maximize business activity and efficiency.
