Thousands of businesses choose to expand their business in the United Arab Emirates (UAE) for the many benefits, including free trade zones, a booming economy, and of course, a welcoming environment for foreigners.
But while the UAE is encouraging foreigners to start their business here, it doesn’t mean that everything’s going to be easy. In fact, you have to learn things like setting up a mainland LLC in the UAE, finding ways to establish your business seamlessly and discovering strategies that will help you promote your business in the local market.
With everything that needs to be done, it’s so easy to be overwhelmed and commit some of these common mistakes along the way:
- Launching without doing any market research
UAE may be one of the most progressive economies in the world, but that doesn’t give you any guarantee that your product will sell right away, especially if you don’t know who you’re selling it to. Insufficient market research is a surefire way to make your business fail even before you start. So make sure that you take the time to understand the local landscape, get to know your customers and even keep an eye out for your competitors.
- Not planning for your finances ahead of time
It doesn’t matter how successful your business is. Expanding it is just like starting from scratch all over again, which means that you don’t get to expect any real returns for at least the first year of opening. With this in mind, you know that you have to plan your finances ahead of time, so you’ll have enough resources to take care of expenses like applying for licenses, finding an office space, hiring employees, moving your products and keeping your business up and running day in and out. Aside from your savings, you should have enough money to sustain all your expenses for at least an entire year. This will give you some breathing room until you can finally start to see profits rolling in.
- Deciding on the wrong business structure
The great thing about doing business in the UAE is that it offers a lot of privileges to foreigners who set up their business in the country. But your choice of business structure also dictates how you can take advantage of those privileges or if you’re going to be limited with what you choose. This is why it’s very important to learn about the coverage of mainland, free zone or offshore business structures so that you can decide on the right structure to fit your nature of business.
- Skipping cultural learning
While the UAE has been an open country, especially Dubai where the majority of the population are foreigners, it is still a highly cultural place where traditions and practices are still followed by locals. Now if you are to do business in the UAE successfully, you need to learn about its culture first. This will help you respect the country’s practices and conduct yourself properly whenever you’re meeting clients or just going around promoting your business.
- Forgetting to learn about legal business requirements
The UAE has very strict laws when it comes to foreigners doing business on their soil. Aside from applying for a business name and choosing a business structure, you also need to learn about different compliance standards based on the nature of your business, so you can comply with them and avoid fines and suspensions in the future. It’s also very important to understand your tax obligations as a business in the UAE. While the country doesn’t impose tax on personal income, it has a complex corporate tax framework that you need to learn and understand.
- Not managing your finances effectively
The thing is, you could have millions in your pocket when you start your business in the UAE and still find yourself empty-handed after a few months of operation. Living in the UAE is more expensive than in a lot of other locations, so it’s very important to learn how to manage your finances effectively and make it last until you start seeing profits. Aside from opening a corporate bank account, you should also create an efficient system of tracking all your expenses to determine if you’re overspending. It also gives you the opportunity to create a more realistic budget that will help you keep your finances in check.
Finally, expanding in the UAE means that you will need all the help that you can get. Doing things alone, thinking that you’ve already done it before, won’t do. This is a completely different location with new rules and regulations. So doing things on your own could mean committing a lot of mistakes and causing delays to your operations. Good thing you have us to help you every step of the way. You just need to call our team to discuss your needs, and we’ll help you with our professional services.
