UAE is one of the most popular business hubs in the world. It is a fantastic place to expand your business, thanks to its business-friendly conditions, professional environment, tax exemptions, and world-class infrastructure. Many businessmen have taken their businesses to incredibly profitable positions due to the country’s open and strong economic structure.
Opening a branch office in the Emirates will add value to your services/products as the country is home to thousands of your current and potential customers. It will also help your business to rapidly grow, quickly gain of trust of people, and make a high reputation in the market.
UAE is consists of seven Emirates; Abu Dhabi, Dubai, Sharjah, Ajman, Ras Al Khaimah, Umm Al-Quwain, and Fujairah. You may consider each Emirate as a State. This is the best perk of the UAE: you may be residing in an Emirate, but traveling to another one is extremely easy.
Each one of them is best suited for certain businesses. You should be aware of the traits, benefits, restrictions, and differences between these Emirates before opening your branch office in one of them. So, without any further delay, let’s explore which Emirate in the UAE is best for your branch office.
What is Branch Office?
Businesspeople and fresh entrepreneurs often mix a subsidiary and a branch. Both of these legal entities are different from each other and have a significance of their own. For those who don’t know what a branch office is, it is an office that is located in some other part of the world other than the head office location of your company. As it is the legal representative of the parent company, the office conducts exactly the same business activities. The parent company is responsible for managing its operations through the branch manager. He/she takes direct orders and reports back to the parent company’s management. Whereas, a subsidiary is a separate company. Nevertheless, it is under the ownership of a parent company located somewhere else. That is why it can have some other name and can conduct business activities that are different from its parent company.
Best Emirates in UAE for Branch Office Setup
Dubai is the business center of the UAE and a spectacular business destination to open your branch office. This Emirates comes with countless work and business opportunities for investors and business owners. It is full of the world’s renowned companies due to its business-favorable tax laws. And we all know about its next-level infrastructure including skyscrapers and 8-star hotels.
Unlike the rest of the Emirates, Dubai has marketed itself in a unique and modern way. People across the globe are not familiar with the other Emirates the way they are with Dubai. Travelers and foreign visitors mostly visit only Dubai in place of the other Emirates, thus creating more potential clients for your business. The city also owns one of the largest and busiest airports in the world. Furthermore, its strategic location between East Asia and Europe opens the doors for trading in these markets.
Dubai also has a downside. Its extreme popularity has turned it into an immensely busy city. Here, you will commonly find a never-ending buzz, jamp packed roads, and longer commutes to the office. Whatsmore, a huge amount of your budget will be spent on renting and living as the costs are quite high in Dubai. Yes, you make good money here and don’t have to pay much taxes, still, you will be paying hefty amounts to the property owners. The best thing to do is to dip into your savings during the starting months. Though it will be somewhat easy for you if you have already secured a job or established your business before stepping into the city.
After Dubai, Abu Dhabi is the most popular Emirate in the UAE. It is also the second most favorable destination for businessmen to open their branch offices. The Emirate has wonderful weather, a good economy, and modern infrastructure, and is a safe place to do business. In opposite to Dubai, Abu Dhabi is not crowded despite having a population of over 1.5 million.
Abu Dhabi has a diverse population as not more than 10% of the whole population is native. You can come across people are from different parts of the world belonging to a variety of cultural backgrounds. The atmosphere of the city is also very calm and safe for work. The nightlife of Abu Dhabi is as exciting as that of Dubai.
Abu Dhabi is also a rich city due to its abundance of oil. It has more political importance in comparison to Dubai because it is the capital of the UAE. Living in this Emirate is much more affordable. The city is traditional in terms of culture and offers numerous jobs with handsome salaries.
The third and final Emirates on the list is Ajman. The city is not so far away from Abu Dhabi, just 153 kilometers apart. In addition to that, it is at a distance of only half an hour’s drive from Dubai, if there is not much traffic on your way. Ultimately, you can expand your business in Dubai as well to attract more customers.
This Emirate is cheaper and smaller in size than the Emirates mentioned earlier. Dubai is 3,885 km2, Abu Dhabi is 67,340 km2, and Ajman’s area is only 259 km2. Despite Ajman being the smallest one of them all, it’s also the densest city, home to more than 500,000 people. One of the main reasons for such high density is the cheap cost of living. Residents can get larger homes for half the rent that in Dubai. The atmosphere here is very quiet and pleasant, making Ajman a very leisurely Emirate to open your branch office.
5 Important Factors in Choosing an Emirate for Branch Office Setup in UAE
Relationship with Other Businesses
Setting up a branch office will give you the opportunity to make a corporate relationship with relevant companies established in the zone. And as your company will do partnership with the relevant companies, it will help in growth and building reputation in the market. It will also provide a helping hand in widening your target market and hence, increasing your customers.
Analyze Your Target Market
As discussed in the beginning, a branch office conducts a wide range of activities similar to its parent company. One such crucial activity is market analysis. Analyzing the target market has great significance as it allows you to identify and understand the demands & expectations of your potential customers. So, when choosing an Emirate, you should analyze its market and see whether it is suited for your business or not.
Setting up a branch office in Dubai will offer you 100% ownership of the business. Business owners may need to look for a local service agent for acquiring business services related to the government. You will not be handing over ownership of your business to the agent. You may ditch the local sponsor when opening your branch office in Dubai, UAE.
Selecting Right Economic Zone
Location for the establishment of a company also plays a crucial role when it comes to opening a branch office to expand your business. In the UAE, you have three options to set up your business: free zone, offshore, and the mainland. Understanding the characteristics, strengths, and laws of each of these economic zones of the Emirates is required to make an informed decision. Once you have understood the differences between them, you are good to choose a zone that meets your business’s demands. Making your business operational requires office space. You can choose the right economic zone that offers physical office spaces to business owners.
Your budget will also decide the selection of Emirate for your branch office. The costliest option is Dubai. Then there is Abu Dhabi and Ajman. After that, you have the options of other Emirates. If you have a heavy budget to invest in, you can go for Dubai.
Open Your Branch Office in Dubai With Riz and Mona
A branch office helps to generate tons of revenue for the parent company if opened in the ideal Emirate. This guide is made to help you in choosing the best Emirate in the UAE for your branch office. If you are still confused, you can reach out to us for further information. Setting up a branch office requires documentation, involves many steps, and has a proper process. Riz and Mona Business Setup Consultancy can help you in establishing your branch office in the UAE. So, don’t hesitate to contact us. Simply, get a free consultation and take the right step to expand your business internationally to make huge profits.