5 Things to Consider Before Starting a Hotel in Dubai

The United Arab Emirates is a popular investment destination owing to its wealth of natural resources and continued economic expansion. Dubai is well-known for its gorgeous architecture as well as the plethora of tourism attractions available to its visitors. Dubai is often regarded as one of the world’s most popular tourist destinations. Every year, a rising number of visitors flock to Dubai, attracting an increasing number of corporate investors.

Because the number of tourists continues to rise year after year, it seems that investing in the growth of a hotel company will be a profitable venture for investors to pursue. The previous year, Dubai hotels generated a profit per room of 230 percent, which is an exceptionally outstanding figure. The hotel business in Dubai will grow by leaps and bounds in the run-up to EXPO 2020, with over 50,000 rooms expected to be completed by the end of the year. As a result, if you want to make an investment in Dubai, you should think about creating a hotel company there.

Before starting a hotel company in Dubai, there are a few requirements that must be met. This course will assist you in understanding the fundamentals of business, which will be beneficial to you throughout the hotel establishment process. Please join me in getting the festivities underway.

The following are things to consider when opening a hotel in Dubai:

Hotel Management will enable you to establish yourself as one of the most well-known enterprises in the world.

As the Dubai Expo 2020 draws closer, the hotel industry will reap the benefits of the city’s influx of millions of international visitors. The following are some essential considerations that must be addressed prior to the establishment of a hotel company in Dubai.

Examination of the Debt Market

Market research on rivals is essential in the growth of a business since it allows you to learn about the ideas and advancements of your competitors. In today’s competitive world of debt, knowing the industry in which you want to develop a corporation is important to your success. Market research is the only approach to generate innovative ideas and technological advances that have not yet been realised. If you have thoroughly researched the market, there is minimal chance that your rivals will infringe on your intellectual property rights. In order to succeed in this competitive environment, it is necessary to adopt distinctive and inventive concepts that are unique to the globe, which can only be done by debt market research.

Identifying an Appropriate Location

The location in which the hotel is constructed has an influence on whether or not it will be successful. Make certain that you have completed all of the essential research and surveys before committing to a certain site for your hotel. The location of your hotel has a significant impact on its long-term survival.

Considerations to take into account before freezing a region;

A prominent location in a well-traveled region should ensure that the hotel is clearly visible to the general public. Make certain that your hotel’s signboard is easily visible as well. Customers like to return to hotels that are conveniently accessible to them, which increases the amount of foot traffic in the hotel lobby. As a result, more customers would choose lower-priced hotels over higher-priced hotels if prices were acceptable to all sorts of clients.

A number of free zones, both on and off the mainland, are available for the growth of the hotel industry in Dubai. A number of free zones, both on and off the mainland, are also available for the building of hotels.

Freezone/Offshore/Mainland

In Dubai, there are three distinct commercial jurisdictions, each with its own characteristics and advantages: mainland, offshore, and free zone. Here are the distinctions between Dubai’s mainland, offshore, and autonomous zones:

Mainland:

• Mainland refers to Dubai’s onshore jurisdiction and is governed by UAE laws and regulations.
• Companies from the mainland can conduct business throughout the UAE, including the local market.
• They have no geographical location restrictions on their operations.
• Companies on the mainland can trade freely with both mainland and free zone companies.
• They are subject to the UAE government’s commercial regulations and requirements.
• Mainland companies are required to have a local Emirati associate or agent who owns at least 51 percent of the business, with the exception of certain circumstances and designated free zones.
• They can bid on government contracts and have access to the local market.
• Companies on the mainland must adhere to specific legal procedures and obtain approvals from various government agencies.

Offshore:

• Offshore companies in Dubai are governed by the pertinent offshore jurisdiction’s rules and regulations, such as the Jebel Ali Free Zone Offshore Companies Regulations.
• They are prohibited from conducting business within the UAE mainland market.
• Offshore corporations are exempt from taxes and can possess global assets and investments.
• They offer shareholders and directors an elevated level of privacy and confidentiality.
• Offshore corporations are typically utilised for holding assets, managing wealth, and conducting international business transactions.
• They are not required to have a local Emirati associate and are not subject to the UAE’s commercial regulations.
• However, offshore companies may utilise the services of a registered agent.

Free Zone:

• Free zones in Dubai are designated areas that offer enterprises special incentives and advantages.
• Free zones have their own regulatory structure and are administered by distinct authorities.
• In free zones, foreign investors can own 100 percent of a company without needing a local partner.
• They are restricted to conducting business within the free zone or with entities outside the free zone.
• Free zones provide benefits such as 100 percent foreign ownership, tax exemptions, customs advantages, streamlined company formation procedures, and repatriation of profits.
• Each free zone is tailored to specific industries or sectors by providing infrastructure, facilities, and services that are industry-specific.
• Free zone businesses are required to acquire a licence from the respective free zone authority and abide by the specific free zone’s regulations.
• They are in close proximity to ports, airports, and other transportation hubs, making them ideal for import-export and logistics enterprises.
• It is essential to observe that the specific rules and regulations may differ between Dubai’s free zones and offshore jurisdictions.

The use of novel concepts

As the number of travellers grows, so does the need for hotels; but, how can your establishment stand out from the crowd? This should be your first and foremost priority. As previously said, standing out from the crowd will establish you as a trailblazer in your field. As a consequence of the engaging and attractive environment, more consumers are drawn and kept. The ability to combine various kinds of cuisine will also be useful in order to create an enjoyable and diverse dinner. In a competitive market, distinguishing yourself by greeting visitors in a distinctive manner will set you apart.

Expenses that are expected to be incurred

Before starting a hotel company, make a list of all of the expenses that will be incurred in order to prevent wasting money and time. Because the inauguration of the hotel would entail a large financial expenditure, meticulous planning is required.

To avoid wasting money, every prospective restaurant owner should be informed of the expenditures that will be incurred before opening their doors. The following are some of the costs that should be budgeted for:

• Permission
• The costs associated with creating the hotel (equipment, tables, seats, and so on).
• Expenses related with the purchase or rental of a new home.
• Purchases made for the first time
• Cash on Hand (also known as working capital)
• License Varieties are the fifth item on the list.

If you want to open a restaurant in Dubai, you will almost certainly need two kinds of licences:

Permission to Engage in Business

When it comes to obtaining business licences in Dubai, the Department of Tourism and Commerce Marketing is responsible for determining what kind of restaurant you may operate. The kind of restaurant that will operate should be indicated in the licence.

Permission to Serve Food is required.

Following the acquisition of your trade licence, you must submit an application to the Food Safety Department for a food licence. You will be issued a food licence by the Department of Food Safety.

What is the meaning of the abbreviation KGRN?

Due to the fact that KGRN will assist the owner in the building of their hotel setup by giving all of the services required for the establishment of a hotel business, the owner will not have to worry about anything.

After considering the aforementioned reasons, investors may pick a business consultant such as KGRN, which is dedicated to assisting them in the establishment of any company in the United Arab Emirates. Please do not hesitate to get in touch with us; we would be pleased to help you out.

FAQ’s – Hotel Setup Business in Dubai

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