Choosing the Best Location in Dubai to Start a New Business

Starting a business in Dubai has various perks, which ultimately aid in the growth of the business. Dubai’s business landscape is one of the most attractive places for investors to start businesses which is evident from the growth rate of issuing trade licenses which increased by 30% in Q1 of 2023 itself as compared to Q1 of 2022. Even though there are many advantages to starting a business in Dubai, it is always the best course of action to choose the best location as per the requirements of the business before setting up a business in Dubai. The right location will provide the business with a firm base to start with, and it can turn out to be a game changer in operations. 

However, choosing location to start a new business might not be as easy as it seems because of many factors. Foreign investors or entrepreneurs might not have sufficient knowledge of the demography of the specific areas in Dubai. Hence, in these situations, consulting business set up professionals to select a location for the business is the best option.

How can you choose the best place for your business in Dubai?

The selection of an appropriate place for setting up a business in Dubai is crucial, as the location in which the business is located has a great influence on its operations. While selecting the appropriate location for the business, it must be ensured that the basic requirements of the business are met or not. Below are some of the factors that must be known while selecting a location for the business in Dubai:

• Identify the needs and objectives of the business.

Having a clear idea of the objectives and requirements of the business is very necessary before selecting the location. The businesses might have multiple opportunities, like free zones, offshore, or mainland. But the business must have the realization that whether it wants to get tax exemptions or customary advantages from the authorities, whether it requires tax-effective solutions for carrying out the operation globally, or whether it wants to increase its target market, based on which the business can select between the options available.

• Knowing the target market

When you choose the location for the business, you must always have an idea of the opportunities and possibilities that will be available in that location. Having an idea of the target market for which the business is set up is important, based on which you can select the appropriate location for the business. If your business focuses on providing premium goods or services, then you must choose the areas where luxurious people come. On the other hand, if you focus on providing budget-friendly goods and services, then you must select the location where normal individuals visit.

• Accessibility to the infrastructure facilities

This is one of the crucial factors that must be kept in mind while selecting the location for the business setup. The location must provide easy access to all the required amenities and infrastructure, like airports, seaports, metro stations, telecommunication facilities, public transport facilities, and basic utilities like water, electricity, etc.; hence, while selecting the location, these must be kept in mind.

• Cost of setting up the business

The cost that might be incurred in setting up the business in the various locations must be analysed. If you are starting a small business, then you might not be required to start a business in a location that incurs high set-up costs. If you plan to start a business in a luxury area, then the costs of setting up may be high; hence, these factors are also important. The expenses of starting the business must also be taken into account to avoid future hindrances.

• Opportunities for the growth and expansion of the business

While selecting the location for the business in Dubai, thorough research must be conducted regarding the opportunities available for the business. The past performance of the already established businesses in the same location, the rules and regulations of such locations, the types of businesses apt for the location, the past track records of other businesses, etc. must be studied before finalizing the location for the business. This thorough check can give you a clear picture of whether your business will prosper in the future or not.

• The legalities and formalities of setting up a business

Generally, the formalities for business setup in Dubai are quite similar, but in certain circumstances, they may vary based on the type and nature of the location and also the business. You must select a location that might not have complex formalities for setting up the business; hence, it can reduce the time incurred in starting the business in such a location. Businesses can be set up easily in such locations.

• Distance from other business entities

While selecting the location for business, it must be checked whether the other business organizations can be accessed easily or not. Staying in close contact with other businesses can help with networking and collaboration, which might benefit the business in many ways. Having businesses nearby can also help in getting required services at a friendly rate rather than paying high amounts.

• Type of sector or industry of the business

There are many locations to set up a business that is ideal for certain specific industries, as Dubai has many free zones for different kinds of sectors. Hence, you must select a location for the business that is appropriate and complementary to the industry in which you are planning to set up the business in Dubai.

Different locations in Dubai

Dubai has many categories of locations for starting a business, of which the major three are the mainland, free zone, and offshore. Each of the categories is an ideal location for specific types of businesses. The entrepreneur who is planning to start the business in Dubai must also be aware of these locations.

Mainland

Businesses with the objective of conducting operations in the UAE market can opt for the mainland. There are certain rules and regulations that might be met while setting up a business on the mainland, like having a local partner or sponsor, etc. The licenses for these businesses are issued by the Dubai Department of Economic Development, which permits the businesses to carry out operations all over the UAE and globally. Click here to know more about Mainland company formation

Free zones

If the business entity were to enjoy the tax exemptions and have 100 percent foreign ownership along with the customs benefits, etc., then the business could be set up in a free zone where all these perks are available. The businesses that are planning to set up in the free zone don’t require office space, so they can transact virtually. The trade licenses for these businesses are issued by the authorities of the concerned free zones. In Dubai, there are various free zones for specific industries that are open to all.

Imagine you are thinking of launching a new active-wear brand targeting young people in the UAE. Here’s how the above factors can help your decision:

• Since your initial focus will be on Internet sales, you don’t need to open a physical store.
• Trendy neighbourhoods like Downtown Dubai, Dubai Marina, or Jumeirah are probably home to young professionals.
• A reliable internet connection and easy access to delivery services are essential for any e-commerce company.
• For a startup, it might not be possible to set up a shop in a commercial area with high rents. Take into account setting up a virtual office or co-working facilities in popular locations.
• If you plan on doing business within the United Arab Emirates, a mainland configuration would be appropriate.
• Being close to yoga or fitness facilities may encourage collaborations or influencer marketing opportunities.

By considering these factors and conducting further research, you can select a location in Dubai that perfectly aligns with your brand’s objectives and sets you on the path to success. Click here to know more about free zone business setup

Offshore business

If the business entity is in search of a tax-efficient location for setting up a business, then Dubai’s offshore companies are an option. Offshore companies have the freedom to conduct their business internationally without any restrictions. There is a zero-tax rate for offshore companies.

Conclusion

The entrepreneurs who are planning to set up their businesses in Dubai must critically appraise the options of locations available, keeping in mind the key factors discussed above. Selecting an appropriate location is a key process that influences the business during its lifetime. Making a strategic decision about selecting the location is a must, as it directly affects the operations and profits of businesses in Dubai. The selection of an ideal location may seem intimidating, but with the help of professional business setup consultants like CDA, it can be a simple and easy process. The professional assistance might reduce the cost of conducting the research to select the best location for businesses in Dubai.

CDA: Your assistance in selecting an ideal business location

CDA’s business set-up services can assist in choosing location to start a new business along with providing premium business set services, trade license services, compliance services, etc. The team of professionals at CDA can assist you in getting the proper insights into the locations that are appropriate for your business. They can also aid you in getting all the best facilities required by your business. CDA can help you minimize business setup costs by getting all the formalities sorted out in the simplest manner possible. CDA’s experts can help businesses identify the key opportunities available in various locations and give a holistic picture of the future growth possibilities of the business.