Geographic expansion is necessary for accessing new markets, can be financially beneficial, and will give you access to new talent pools to build your pipeline for the future.
At Kinetic, we have seen a multitude of new and existing businesses choose this area for their investment, and in this article I want to discuss with you some of the main points to consider, including some general business expansion issues as well as how to expand into the UAE.
The trajectory of the UAE’s economy is still increasing. The GDP of Dubai is predicted to grow by 3.8% in 2020, overtaking the rate of 2.1% that it enjoyed this year.
New businesses are starting up all the time in this region, with numbers of new business licences increasing year on year – the Dubai government issued 6,709 new business licenses in the first three months of 2019.
The government this year revised tax schemes in Dubai’s Healthcare City to allow for ease of business – so now really is the time to expand your pharmaceutical or medical device businesses in this region.
But there are a few things to consider when thinking about setting up a business in the UAE – let’s start with deciding on if now is the right time for your business to expand.
Is it the Right Time to Expand?
Growing your company is always exciting and being part of a company which is expanding can be a momentous time. Growing means more profits, a wider reach and the opportunity to make more of an impact.
But how does a company know when it is the right time to expand? The key signs include -
- Having a steady customer base, which is currently growing.
- Consistently exceeding your business goals.
- You have a strong team who are ready for the challenge of expansion.
- It is fiscally the right time for your business to take advantage of a new market in a new country.
When your business knows that it’s time to grow – the next step is deciding where. In our experience, the UAE should be one of the first places for you to consider, for the following reasons.
New Country – New Benefits
Free Trade Zones
The Emirates are home to 45 free-trade zones, where homegrown and foreign investors can enjoy trading under special tax, customs, and import regulations. These schemes were implemented to boost trade and commerce in the region, and the regulations have had a positive effect.
In free trade zones, businesses enjoy tax breaks that are not enjoyed anywhere else in the world. These include -
- Faster licensing and business set up.
- Low start-up and operational costs.
- Exclusion from all import and export duties.
- 100% tax exemption on personal or corporate income gains.
- 100% ownership for investors regardless of their nationality.
- 100% repatriation of capital and profits.
- Plus many more benefits.
Expanding in the UAE
Before expanding into the UAE, we recommend that your business completes a thorough investigation of the process. The UAE government website
is an excellent source of information on what exactly companies need to do before setting up.
There are particular idiosyncrasies in the UAE, which businesses new to the area might not be aware of. Working with a regional service provider
will be able to ease these difficulties. For example, when setting up a business in the UAE, the business name must not be deemed to be offensive and must not make reference to Allah, Him, or any other religious or political groups, and full names must be used – no abbreviations.
There are also rules around bank accounts, employee visas and incorporation paperwork. While the government have strived to make the procedure for new businesses fairly straighforward, it is still a good idea to work with local experts to make sure the process runs as smoothly as possible.
After these initial steps, next comes building a strong and skilled team of local and non-local employees.
Building a Team in the UAE
With over 80% of the UAE’s workforce coming from overseas, your pharmaceutical or medical device company will probably also be a multicultural outfit – the country has been expanding at such a rate for such an extended amount of time that the infrastructure has had to rely on expatriate workers.
However, to redress the imbalance between local vs foreign workers, the government has implemented a nationalisation programme to get Emiratis into local jobs.
Part of the broader Vision 2021 scheme, rules exist around the number of local workers business must employ, for example, companies with over 1,000 employees are required to hire an Emirati citizen for data entry positions.
Working with a local recruiter like Kinetic will take the stress out of equipping your new team with the staff that it needs, both in terms of skill and to comply with local laws.
Earlier this year, the government announced sanctions for businesses which had failed to comply with Emiratisation rules. Going forward, the Emirati government are dedicated to maximising the amount of Emiratis in notable positions, and Kinetic have the extensive local knowledge and expertise in recruiting in the UAE to be able to provide your new business venture with the talent you need.
How Kinetic Can Help
Kinetic source professionals locally and internationally for leading multinational, regional and local Pharmaceutical and Medical Devices companies, including Consumer Healthcare organisations.
As such, we understand the niche requirements for all specialisms of this ever-increasing regulated industry. To find out more about how we can help you in landing your next career progression, contact us