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How To Start a Small Business in Dubai (2022)

Jun 29, 2022 | UAE Company Setup

Did you know that around 20% of all small businesses will end up failing within the first year? It’s a sobering statistic. Looking beyond the notorious first year, the chances of a business failing only increases as time goes on. If you are interested in starting a small business in Dubai, it’s important to be aware of the realities.

However, the good news is that your new, small business doesn’t have to be a failure as long as it is set up and maintained in the right way.  In fact, learning how to start a small business in Dubai is not as hard as you may think.

There are some important factors you will need to take into consideration before you open your Dubai business. Once you have everything set up to start a small business, all you have to do is put in enough effort and enough time, and your business should be a success.

Keep reading and learn all about how to start a business in Dubai.

Starting a Small Business in Dubai: Choose Your Niche

Before you start any Dubai businesses, you will need to think about which niche your business will specialise in.

Do you plan on selling cosmetic products, SEO editing, food delivery services, e-commerce, real estate, clothing or cleaning services? Or something else? Whatever your business ideas are, Dubai is a hotspot for entrepreneurs wanting to embark on any exciting enterprise. If you don’t yet know what you want the niche of your business to be, this is the first milestone to reach.

By settling on a business niche, you can start focusing on bringing your business ideas into reality. This, however, will take some time and a lot of planning. For that reason, it is best that you think long and hard about what kind of business niche you want to pursue.

After all, some niches are much more popular than others. In the same vein, some niches are so popular that you might end up overrun by the competition. So, if you want your business to be a success, you’ll have to choose a niche you know you can handle.

More than that, you’ll have to come up with something that sets you apart from the crowd.

In the United Arab Emirates, small business competition is fierce. With a niche that is unique and solves a paint-point for consumers, you’ll be memorable in the crowd. In this way, people will have a reason to be interested in your products or services compared to the products or services of your competitors. Keep in mind that this will not be easy at first.

Refine Your Business Activities

Starting a business is the hardest part of having a business in the first place. You have to lift your business off the ground on your own before your business will start generating success and money on its own.

When you decide on the niche for your business, you will also need to specify your business’s activity for legal reasons. There are thousands of activities a business can have, and some businesses even have multiple activities that you will have to list. Listing your business’s activities is important because these activities will be necessary for getting your business license.

If you don’t list one of your business’s activities or forget to list one of them, you could end up in big trouble later on. This, of course, could put all of your business efforts to a halt for a certain period of time. But what should you do if you don’t know what kind of business activities to list?

If this is the case for you, don’t worry, because business setup services can help. They can guide you through the basics of not only business activities but also the other aspects of starting a business in Dubai. But what else do you need to consider besides choosing a niche and listing your business’s activities?

Choose a Good Name for Your Small Business

An important aspect of starting a small business in Dubai is deciding on a good business name. In fact, a business name is more than just an ordinary name. It is the foundation of your brand and your company’s label.

Many people don’t realize that the name of a business makes all the difference when it comes to that business’s success.

It’s also important to know if you’re starting a business in the United Arab Emirates, there are business naming conventions to consider. This applies to any business established in Dubai, Abu Dhabi and other emirates across the Middle East.

People should be able to find your business by typing in the business name on the internet. But you’ll find that if you end up choosing a generic name for your business, it will be very difficult for people to find your business both online and in person. For example, suppose that you want to open a flower shop and you end up calling it “Beautiful Florals.”

While this name is short, it is not catchy, and there is nothing about it that makes it stand out from any other flower shop. More than that, the name is not memorable either. For that reason, people will never be able to find your shop because typing “beautiful florals” on the internet likely would not produce results for your shop.

Instead, results for your shop would end up buried underneath results for flowers and other flower services. So, what should you do to make sure that your business’s name is good and catchy? To start, you will want to choose a name that is uncommon.

That way, you won’t risk your company getting confused with another company.

How to Pick a Memorable Name for Your Small Business

You will also want to make sure that your company name isn’t too similar to the name of another company. At the same time, you won’t want your company name to be too long or strange.

Instead, it should be short and catchy. That way, when people see it, they should be able to remember the name without putting in much effort. This will make it much easier for people to find your business on the internet and, as a result, it will bring you more business.

If you’re struggling to come up with a name for your business, don’t worry. All you need to do is go online and search for unique business names. There are plenty of name generators out there that you can try.

These generators may not give you good names right off the bat, but they may give you inspiration for a catchy title. Once you think you have a good business name, it’s best to run it past trusted colleagues or friends. Consult with people you know and with a business setup service to make sure the name for your small business suits your niche and reflects your brand.

Then, you can narrow down your choices and finally decide on a business name and move on to other business responsibilities.

Open a Bank Account For Your Small Business in Dubai

Many people end up getting so overwhelmed by all the tasks necessary to start a business that they end up forgetting that opening a business bank account is very important. When starting a business, the last thing you want is for that business to be connected to your personal bank account. This could lead to all sorts of problems that can be hard to fix.

Fortunately, you can avoid most of these problems by opening a bank account for your business. You might be wondering why having a business bank account is so important in the first place. The reason for this is that you can easily separate your business expenses from your personal expenses.

More than that, you can separate your business’s income from your personal income. This may sound like a simple result, but you’ll find that separating your personal and business finances in this way can make your life a lot easier.

However, opening a corporate bank account in Dubai may not be as easy as it would be in other countries.

This is especially true if you come from overseas and plan on starting a business in Dubai. In particular, Dubai has money-laundering rules that are quite strict, which, in turn, makes it quite difficult for those from overseas to open business banking accounts. Even so, the task is still not impossible.

Luckily, there is a particular way of going about it.

Opening a Bank Account With Help

The easiest way to get your business a corporate bank account is to enlist the help of a business setup service. This makes the corporate bank account application process a whole lot easier.

These services may even give you advice on how to best utilize a corporate bank account. Most importantly, these services will take a large weight off of your back. You won’t have to worry about forming your business all on your own.

While this is possible, forming a business on your own can take a long time, and it can be very difficult. This is not to mention that it can be a very stressful experience, especially if you’ve never started a business in Dubai before. Of course, the last thing you want is to be overrun with stress which is why it’s a good idea to avoid forming a business all on your own.

Some people are wary about hiring a business setup service because it involves paying extra money. However, you will find that the money you spend on a business setup service will be completely worth it. A company setup service can help you with just about anything you can think of when it comes to starting a new business in Dubai.

With a bit of help, the business process will be smoother and more efficient than ever.

Apply for a Business License and Get a Business Visa

The biggest step of starting a business in Dubai, of course, is getting a business license. You might have your whole business planned out, but you won’t get anywhere if you don’t have a business license. Fortunately, applying for a business license isn’t as difficult as it might sound.

All you really need to do is go to a governing authority and apply for a business license. If your business is a mainland business, the governing authority will be the Department of Economic Development. In some cases, however, you may need to go to the specific Emirate’s municipality instead.

For instance, if you want to run a food and beverage business in the UAE, you must approach the Abu Dhabi Agriculture and Food Safety Authority Dubai Municipality for a trade license rather than the Department of Economic Development. 

If your business is a free zone business, you will need to go and apply with whatever governing authority the zone has. Whatever the case, you will need to wait a certain length of time once you apply for your business license. This period of time usually depends on what kind of business you are trying to start as well as where you are trying to start it.

For example, on the mainland, you may need to wait several weeks before you get a response on your business license. On the other hand, you may only need to wait a few days if you plan on opening a free zone business.

The Application

To apply for a business or trade license, you will need a few things on hand.

In particular, you will need to complete an application form, two coloured passport pictures, and a copy of the business owner’s passport. Free zones tend to be ideal places to open businesses if you don’t have a lot of money to start your business.

Once you get your business license out of the way, you will also need to get a visa or several visas. This will require a lot of time to apply for the visas and for those visas to get approved. You will also need to consider how many visas you will need based on the people working at your company if applicable.

Again, a company formation specialist can help you with these tasks. That way, you can rest easy knowing the process of starting your business in Dubai is taken care of by professionals.

How to Start a Small Business in Dubai

Learning how to start a small business in Dubai – or anywhere in the United Arab Emirates – isn’t as difficult as you might think.

All you need to do is tackle some important challenges. These include coming up with a good business name, choosing the niche, refining your business activities, and applying for business bank accounts and licenses. Fortunately, help is available to turn small business ideas into a reality. Contact us here to learn more.

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