The Small Business Association estimates that over 600,000 new businesses form annually. Yet, not all of them survive. If you’re considering a new business venture, you may wonder: how do I ensure my business lasts? One way to keep your business competitive is to operate on a lean cost model. And that’s why we’re bringing you this guide to the best business ideas in Dubai.
There are so many ways to set up a profitable business in Dubai. Successful business ideas can range in so many ways. Some examples of successful business ideas are tourism business, cleaning services, retail business, restaurant business, e commerce business, web development or even construction business.
If you want to know why the UAE is a great place to start a low-cost business and our top ideas for businesses in Dubai, keep reading.
Why Dubai Is a Great Place to Start a Business
You can start a business anywhere, so why Dubai? Dubai is home to a unique business model known as the free zone. Free zones are areas in Dubai where businesses can incorporate and enjoy special benefits. As a result, Dubai is an incredibly popular and profitable place to do business. Firstly to start your economic development for your business in Dubai- you’ll need some successful business ideas.
Of course, entrepreneurs can also set up traditional businesses on mainland Dubai. Going this route comes with one major benefit: profitable businesses aren’t restricted in where they can sell their goods.
Free zone businesses can only trade with international and other free zone businesses. Unless an entrepreneur gets the necessary approvals, his business can’t trade with customers on the mainland.
Still, free zones are definitely something to look into if you want to start a business in Dubai. Why? Compared to businesses set up in free zones, traditional businesses don’t enjoy the following privileges.
Pay 0% Income Tax
Businesses in Dubai’s free zone don’t have to pay income taxes. This is one of the key factors for them being one of the most profitable business. What’s more, free zone companies do not pay customs taxes. The only time you have to pay customs is if you are importing goods into mainland Dubai.
When you do not have to pay income or customs taxes, your business will save money on operating costs. And that means you can keep more of the profit.
Feature 100% Foreign Ownership
On mainland Dubai, there used to be a law banning companies from having 100% foreign ownership. All businesses had to have at least one shareholder from the UAE to incorporate in Dubai.
However, that changed in July 2022. Now, businesses in both free zones, Dubai internet city and mainland Dubai can be 100% foreign-owned. This can also attribute to them being some of the most profitable businesses.
Receive Specialized Support
The original purpose of free zones was to stimulate the UAE economy. Today, that is still the goal for the program. That is why the UAE government provides perks and support from specialists to free zone businesses.
If you have never started a business before, these kinds of resources would be invaluable to you. That is why so many entrepreneurs choose to incorporate in a Dubai free zone.
Business Ideas: The 5 Most Profitable Sectors in Dubai
Dubai is not known as the investment capital of the Middle East for nothing.
It’s a metropolitan area that boasts a unique mix of entrepreneurial spirit and ease of lifestyle. Starting a business here is a great way to take advantage of what Dubai has to offer. The city is home to booming industries, including these top five most profitable sectors.
1. Real Estate
The UAE is home to 8.92 million expats. And that is more than 89% of the country’s total population. What’s more, Dubai is one of the most visited cities in the world, bringing in 16 million tourists in 2017.
All this means there is a massive demand for property. Whether people are looking for a quick stay, a longer-term rental, or a home away from home, Dubai has it all.
The UAE is strategically positioned between Western Europe and the US and the East. It sits right in the middle of the international trade route, with advanced infrastructure allowing connections by sea, land, and air.
These factors are only a few reasons why import/export businesses are so profitable in Dubai. Plus, if you start an importing business in a free zone, you will not even have to pay taxes on your goods.
In 2021, the global e-commerce market hit a whopping $13 trillion valuation. Experts expect that number to increase to over $55 trillion over the next six years. And Dubai contributes billions of dollars to these figures.
Whether you want to offer services to online retailers or start an e-commerce business yourself, Dubai is the place to do it. You can work remotely in Dubai to take advantage of the 0% income tax rate. Depending on your chosen business activity, e-commerce has low barriers of entry and heaps of working flexibility. Online businesses are profitable businesses. Consequently, it’s one of the most popular business ideas in Dubai.
The healthcare sector is currently experiencing record demand in Dubai. There is not only a need for healthcare professionals but also service providers, healthcare technology, and medical real estate.
Demand for these types of businesses has only increased since the COVID-19 pandemic. And the entrepreneur-friendly UAE government will be ready to incentivize businesses that are prepared to meet that demand.
This list of booming Dubai industries would not be complete without mentioning tourism and hospitality. After all, this city ranks sixth in terms of the most-visited tourist destinations on Earth.
As a tourism entrepreneur, you could provide luggage delivery, start up a food truck, or even offer photography services. Literally anything you can think of would work as a tourism business in Dubai.
The Best Small Business Ideas in Dubai
Now that we have keyed in on some great industries to start your business in, we can move on to some specific business ideas.
Based on the above information, here are the most lucrative small business ideas if you want to incorporate a start-up in Dubai.
Start a Luxury Real Estate Company
There has never been a better time to start up a luxury real estate business in Dubai.
Demand for luxury properties compared to supply recently hit an all-time high in Dubai. And local luxury real estate firm USH saw record transactions of over $816 million last year.
Build Up a Vacation Rental Portfolio
Looking for a way to combine the profits of a real estate company with a tourism-friendly business? Then you need to get in on Dubai’s vacation rental market.
But vacationers are not just looking for any rental. They want luxury. Tourists are searching for short-term stays with luxurious extras like space, comfort, home gyms, private screening rooms, and more.
Offer Relocation Services
Relocation companies help families move to Dubai for work. These companies offer services like packing and shipping, finding customers a new home, and even arranging airfare.
The best thing about starting a relocation business is that you serve other companies, not consumers. B2B businesses can be far more profitable, especially if you can secure a contract as a company’s sole relocation provider.
These types of opportunities are especially endless considering how much foreign investment is in Dubai. So, also make sure to develop a good referral business if you go this route.
Develop Hospital Data Analytics Software
The COVID-19 pandemic revealed cracks in Dubai’s healthcare infrastructure. A major need today is for data analytics. This is why starting a healthcare analytics software company in Dubai is a highly profitable idea.
Become a Hospitality Property Investor
Hospitality in the UAE is a $7.6 billion industry. Considering how lucrative real estate can be in the United Arab Emirates, and especially in Dubai, combining these two ventures can make for one profitable startup.
To start your hospitality investment portfolio, you will need significant investment. You can always start small with vacation rentals and then scale up if you are interested in this business idea.
Purchase a Medical Facility
Looking to combine the profitable sectors of real estate and healthcare? There is no better way to do so in Dubai than by purchasing a medical facility.
You can rent out space to a healthcare group or individual doctors. And you will make tons of money while doing it.
Provide Import-Export Sourcing Services
Dubai’s strategic location and favorable tax laws make it a great place to start an import-export agency. This business idea is especially easy if you have business connections in Dubai and overseas.
Import-export agencies connect buyers with exporters and sellers with importers. Agents make money through commission fees. This type of business can be highly profitable because you can earn commission twice—once from the importer or exporter and again from the buyer or seller.
Create an Online Exporting Business
Another way you can take advantage of Dubai’s favorable import/export rules is to become an exporter yourself. You do not have to pay taxes on imports in a free zone, meaning you can ship cheap products to Dubai virtually for free.
Once you receive those products, you can sell them via e-commerce. Because this strategy makes your business model so low-cost, you will enjoy higher profit margins than if you started an exporting business in other countries.
Rent a Warehouse to Importers/Exporters
Dubai is on the international trade route. It’s often a stop from one place to the next. And, sometimes, shippers need to store their goods before moving them to the next checkpoint.
If you purchase property near a Dubai airport or seaport, you can make millions renting it to import/export companies.
Organize a Freight Forwarding Business
Freight forwarders basically organize import/export logistics for a living. They find the best prices for shipments, communicate with carriers, and organize shipping timelines.
Like import/export sourcing agencies, freight forwarding firms make money off commissions. In today’s volatile logistics environment, you can command a hefty commission for securing good prices.
Design NFTs for a Living
In 2022, it’s arguable that nothing is trendier than non-fungible tokens (NFTs). NFTs are digital products and artworks built on the blockchain.
But you may be wondering: starting an NFT business anywhere is a profitable idea, so why start an NFT business in Dubai? Dubai’s favourable laws for entrepreneurs mean you would enjoy even higher ROI from this idea. It’s certainly one of the more clever business opportunities in the region.
Sell Handmade Goods Online
This could be one of the most creative business ideas in Dubai. Are you looking for a business idea you can start today and with only one employee—yourself? Then it’s time to get crafty and sell your handmade goods online.
Platforms like Noon and Etsy have made it simpler and more profitable than ever to sell crafts online. And considering how inexpensive it is to acquire raw materials in Dubai, you should definitely consider starting your business in a free zone.
Found an E-Commerce Digital Marketing Agency
Did you know, you can crack into the e-commerce market without having to sell products? One way to do this is to start a digital marketing agency. These businesses help online retailers market their products and earn higher revenues.
You could offer your services to local Dubai companies. Or you can operate purely online and work remotely in Dubai.
Establish a Teledoc Business
Teledoctors can work from anywhere, so why not Dubai? Whether you are a teledoctor yourself or want to start up a teledoc platform, Dubai’s free zones offer excellent advantages for you or your business.
Get Into Health and Fitness Products
Experts project that the health and fitness industry value will reach nearly half a trillion dollars by 2028. And with people increasingly understanding the importance of health, this figure will not stop growing any time soon. For this reason, this is one of the uppermost valuable business ideas in Dubai.
We already mentioned that many tourists come to Dubai looking for luxurious in-home gyms. Why not help homeowners furnish those gyms by selling health and fitness products online?
Be a Healthcare IT Consultant
Becoming an IT consultant is a rising business opportunity in Dubai. Running a tech-consulting business helps companies implement new technologies for their business operations. And some of the highest-earning IT consultants work in the healthcare sector. With so much demand for healthcare in Dubai, it’s the best place to start a healthcare IT consulting business.
One thing to consider is that the UAE government requires consultants to have a degree in the field in which they want to consult. So, if you want to be a healthcare IT consultant, you will need some kind of IT credentials such as a degree in computer science.
Start a Travel Agency
The entire United Arab Emirates has seen an increase in expats and tourists over the past decade. Considering Dubai’s impressive tourism industry, a travel agency is a no-brainer. As a travel agent, you will help foreigners (inbound travel agent) and Dubai locals (outbound travel agent) arrange flights, hotels, and cars for their vacations.
Buy a Hotel
In December 2021, Dubai hotel rates hit their highest level since 2015. Hoteliers averaged over $203 in revenue per room during this period.
If you owned even a small boutique hotel with ten rooms during this time, you would have earned over $2,000 in profits per day.
Give Guided Tours
People come to Dubai for the architecture, history, and culture. And that means they need a local tour guide to show them the city.
If you are not into tours, you could also start an excursions business. You can connect tourists with local events like swimming with dolphins, camel rides, local waterparks, and even hot air balloon rides. As this is a subset of the tourism industry, there’s room for expansion into Abu Dhabi and other regions within the Middle East.
Need Help With Your Business Ideas in Dubai?
Dubai is a great place to start a business because of its favourable business tax and foreign ownership laws. No matter what you are interested in, there are thousands of profitable business ideas in Dubai.
Are you ready to use one of these Dubai business ideas? We’re here to help with every step in forming your business in Dubai. Contact us to learn how much it will cost and how to start a business in Dubai!