5 Tips to successfully entering the UAE Market.

1. Carry out in-depth market research

The UAE market is complex and unlike most other countries in the world. There is a diverse range of
nationalities and a real culture of innovation that is being spearheaded by recent government initiatives,
meaning that trends evolve very quickly. Naturally, this all has significant implications for businesses
trying to establish themselves in the region, and ventures that are successful in other countries aren’t
necessarily profitable in the UAE. As such, market research is a vital stage of setting up a business in the
UAE and planning your entry into the Middle East market.

In its most basic form, market research is defined as gathering, analysing, and interpreting information
about a segment of a specific market. The aim of market research is to determine how your product or
service is likely to fit within the current market conditions, and will include research about your
competitors and the needs and preferences of your target consumer.

‘If market research is not undertaken in advance, companies can sometimes go around in circles looking
for the information, lose time and money and in rare cases can also damage their brand by appointing
the wrong partners in their target market. Sometimes these relationships can be legally binding and
hard to get out of’ Dipti Vaidyanathan and Tamreez Inan, Trade Managers BCB UAE

Market research is important to:

Understand the feasibility of a business

Better understand the market within which you wish to trade

Determine the competition and how your business can maintain an advantage within the market

Identify opportunities within the market

Establish brand positioning and messaging

Identify and understand your target consumer

Develop better products and services

There are an increasing number of cost-effective market research sources available, many of which can
be carried out relatively easily in-house, such as:
Focus Group discussions

In-depth Interviews

Observations

Online surveys

Video conferences & interviews

Mystery Surveys & Shopping

In addition, it may be advisable to check with your local trade association, as many will be able to offer
assistance:

‘Many trade associations and export promotion agencies host seminars or market briefing sessions for
their companies. Some may also offer grants and schemes for new or existing exporters, which can be
used for market research’

2. Develop a business plan

A sound understanding of the market conditions will enable you to develop a clear strategy and plan for
your business. As well as a high-level summary of your business products or services, the key elements
of a business plan should include:

A feasibility study: Determine if the business is likely to be profitable in the current market conditions

Cost analysis: Understand all of the costs involved in establishing and maintaining the business and
determine how you will raise finance if required; do you need to approach an investor? There may be
certain costs involved in setting up the business that you may not have considered, such as trade license
fees, visa costs, and government fees, so it is always worthwhile to seek initial advice from a business set
up specialist . There are also a growing number of SME initiatives and incubation platforms available,
particularly within Abu Dhabi and Dubai, that may help with some of these costs

Forecast: A realistic business forecast will enable you to determine the profitability of the business over
time and is a particularly important stage of securing investment

Sales & marketing strategy: Determine how you will successfully market and sell your product or service
to your target consumer

3. Determine the most appropriate commercial structure

There are a number of commercial structures that your business can take in the UAE; on-shore Limited
Liability Company (LLC), foreign branch, or Free Zone Limited Liability Company (LLC). In most cases, the
cheapest option doesn’t necessarily mean it is the right option, so it is advisable to partner with a local
consultant who has experience within the UAE and can guide you about the business set up options that
are relevant to your industry, service, or product. Read our latest blogs to understand each of these
business set up options in more detail.

4. Understand the applicable laws and regulations

The laws and regulations surrounding business in the UAE are very different to much of the world, and
getting them wrong can be extremely costly. Partnering with a specialist such as PRO Partner Group will
facilitate the set-up process and eliminate any risk of non-compliance.

An important point of consideration at this stage is business etiquette, which again is very different in
the Middle East. In a place where a significant percent of business is done face to face, it is important to
be aware of and respect the culture of the UAE.

5. Consider the implication of VAT

VAT will be introduced in the UAE from January 1, 2018, which naturally presents a number of new
challenges for businesses wishing to operate in the region. The full impact of VAT is still relatively
unclear, but for new businesses planning their entry into the UAE market, it is imperative to develop an
effective VAT implementation strategy in order to be well-positioned in terms of compliance, reducing
risk, and managing cash flow.

Abigail Cuthbert is the Business Development Executive at PRO Partner Group. For further information
on PRO Partner Group’s comprehensive range of market entry services or questions relating to company
set up in the UAE, contact Abi on abi@propartnergroup.com or call a member of the team on: T: +971
(0)4 456 1761 (Dubai) T : +971 (0)2 448 5120 (Abu Dhabi) www.propartnergroup.com

BCB
The BCB - British Centres for Business is a business-to-business professional services company
established with the mandate to provide operational support and market entry services in the UAE to
British companies. They work alongside the British government to deliver on-demand trade services,
providing practical assistance, guidance and orientation for UK exporters, with the primary aim to help
British businesses, particularly SMEs, expand into the UAE.

PRO Partner Group has a strategic partnership with BCB to provide UK companies with incubator-style
support in Abu Dhabi. Helping them understand and explore the market and get underway with a full
Onshore UAE Trade Licence but with lower initial entry point costs.