Purchasing a ready-made business in Dubai: Features & Nuances

Instead of spending time and resources on creating your own business, you can buy a ready-made business in Dubai. A company that is already operating is a good option for those who have experience in conducting commercial activities. Buying an existing business reduces the time to enter the market, allows you to benefit from an established customer base, and streamlined processes.

Buying and Selling Business

Buying a ready-made business with high profitability is difficult. It is necessary not only to decide in which sphere to work, to assess prospects, but also to carefully check the company on all parameters. It is not easy to figure it out on your own, so it is worth seeking the help of professionals.

The Level Consulting will help you open your own business or buy an existing one. Our specialists will assess the financial position of the company, check labor agreements, conduct an audit of the bank account, etc. After the check, The Level Consulting experts will prepare all the necessary documents for re-registering the business in a short time.

Stages of buying a ready-made company in Dubai:

1. Choose the preferred field of activity. You need to start from the direction that interests you. It is important to evaluate previous experience, education, and skills.
2. Assessment of prospects. Understand the market situation, find out what risks and growth points exist. Find opinions of leaders, ask for advice from entrepreneurs who are already working in the direction you are interested in. Be prepared to pay for colleagues' practical experience, as you will receive information they have gathered over the years in a concentrated form.
3. Find a ready-made company for purchase. It is most reliable to search for and buy a business through a broker who verifies the company's financial position and documents and provides comprehensive transaction support.
4. Prepare the documents and conclude the deal. Think about how to resolve financial issues. If this is your first experience in business, it is not worth taking out a loan: if things go wrong, you risk being left with debts and no prospects.

It is important that regulatory authorities and banks in the UAE pay increased attention to buying and selling company transactions. The new owner must provide proof of financial solvency and the ability to manage the business. For example, a company development plan may be required, recommendation letters from counterparts in Russia to confirm experience in entrepreneurial activities, etc. From the state's point of view, by buying a company, you are creating a new business, so be prepared for additional checks and spend time building relationships with counterparts.

The condition of the business you plan to buy may be worse than indicated in the documents. Therefore, before concluding a deal, it is imperative to check the company on all parameters. It is better to seek the help of professionals in this matter.

To check a business in the UAE before buying or selling, you need to:

1. Evaluate the financial position. Conduct a check of primary documentation, obtain confirmation of the company's profit, analyze cash flow in the bank account.
2. Study contracts. Profit should not be formed through work with 2-4 major clients. In this case, there is too much risk of bankruptcy when contracts are terminated.
3. Check labor agreements. Labor relations between the employer and employees should be legally correct.
4. Conduct an audit of the bank account. To avoid errors in calculations with counterparts, it is better to close the current bank account and open a new one. In addition, checks are still quite common in the UAE. The payer's obligations under the check may be significantly delayed in time from the date of issue - this is another argument in favor of closing the current account.
5. Check lease terms. It is necessary to ensure that the owner of commercial real estate intends to continue cooperation.
6. Analyze founding documents. Since 2021, it is no longer necessary to involve a partner - a UAE citizen, which previously, when buying a company, it was important to correctly formalize relations and prevent possible full control by the local. But the changes do not exclude the need to check all documents.
7. Check for restrictions, encumbrances. Make sure the company is not under sanctions by the Ministry of Labor for violations.
8. Request a business plan from the sellers and analyze the business development strategy. Make adjustments if necessary.

Buying and Selling Business Licenses

The main constituent document of a company in the UAE is the license. It indicates the place of registration of the enterprise, types of permitted activities, data of business owners, and key persons with signing authority. When changing the company's management, changes to the license are necessary. In this case, regulatory authorities will request documents from the new owner, including proof of financial solvency, experience in entrepreneurial activities, etc.

A license in the UAE is renewed annually. Each time, it is necessary to provide audited financial statements, a lease agreement for office and production premises for the next period to the regulatory authorities. However, renewal without changing the owner is easier, as no additional documents need to be provided. For some types of businesses, compliance with special regulator requirements is required.

How much does a ready-made business cost in the UAE

Prospective companies are sold at a high price. The exact cost is rarely stated in the advertisement – the parties negotiate personally. The price depends on many parameters: the sphere of activity, turnover, and profit size. A high price is justified by well-established business processes, ready-made contracts, and established relationships with counterparts. It is not worth trying to save money: a price below the market average should raise suspicions. Such companies may face difficulties.

What is the profit of a ready-made business in the UAE

The UAE is one of the wealthiest countries in the world. Huge capital is concentrated in the United Arab Emirates. The country's reputation as an international economic center attracts the attention of investors. The most profitable businesses are IT services, consulting, and advertising. Equally promising are the trade and logistics business, the food industry (especially catering, food delivery, food trucks), and the construction sector. Company turnovers can reach millions of dollars.

Most promising areas for buying ready-made companies in Dubai

The number of companies put up for sale in the UAE does not lag behind demand. Practically in any sector of the economy, you can find a ready-made business with income. Choose considering previous experience of employment and entrepreneurial activity – this way you will quickly orient yourself in business affairs.

Service sector

It is expected that by 2025, the consumption of services in the Emirates will increase by 88%, which is several times higher than forecasts in other sectors – production and trade. The service sector attracts entrepreneurs with the absence of significant capital investment, consumer demand, and simplicity of accounting.

Real Estate

Implementation of large construction projects, a wide selection of ready and under-construction properties of various types fuel investor interest in real estate in the UAE. In this sector, one can provide real estate services, develop online platforms for buying, selling, and renting villas and apartments, engage in technical maintenance of buildings, security provision, and property management on behalf of owners.

Construction

Despite numerous completed infrastructure projects and options for luxury real estate in areas such as Business Bay, Dubai Marina, Burj Khalifa, Damac Hills, etc., the construction sector continues to grow. There is a need for the construction of infrastructure facilities such as business centers, exhibition pavilions.

Tourism

In the UAE, there is a wide range of activities in the tourism sector. In addition to organizing tours of various types and business trips, the preparation of entertainment events, renting apartments and transportation, and conducting excursions are in demand.

Manufacturing

A promising direction is the production of eco-building materials, devices, and equipment, automobiles (these are the main categories of imports in the UAE). The state supports the manufacturing sector: it is possible to sell goods profitably in the mainland or export them through free zones. Goods of local manufacturers are exempt from duties and fees, and they are not subject to sanctions restrictions.

Logistics

The geographical location provides the UAE with the role of a transportation hub and ensures strong partnerships with Asia, Europe, Africa. Infrastructure is developing, the logistics services market is constantly expanding, and an increase in freight traffic is recorded annually.

Investment and Financial Activities

Investment and financial activities are one of the priorities of development within the economic diversification strategy. There are many companies in the UAE that need financial support. It will be beneficial for entrepreneurs who already have experience in brokerage activities, providing financial services, and investing in startups to buy an existing investment and financial company.

Import and Export of Goods

It is easier to buy a ready-made importing or exporting company than to establish processes from scratch. The domestic demand for imports is quite significant because local manufacturers cannot satisfy growing needs. Export is also a promising direction. Exporters can take advantage of agreements on a common customs territory and free trade that the UAE has concluded with many countries.

Conclusion

Owners of problematic businesses often resort to tricks to unload ballast with minimal losses for themselves. Turn to experts who know how to buy a business in Dubai to avoid wasting time and money on such offers. Thoroughly analyze the market and the condition of the company before closing the deal. And if you lack business experience, do not take any action without consulting with professionals: marketing specialists, programmers, HR managers, lawyers. A prepared team and consultants will help you avoid getting into debt and acquire a promising business.