- Article
- August 30, 2018
Renewing a business license in Dubai can be an easy task with the help of PRO services in Dubai. In order to set up business in Dubai, it is compulsory to obtain a trade license from the Department of Economic Development (DED) authority. Any business activity in this city is considered illegal if it is conducted without a trading license.
Trading license acts as a legal license that allows a business to indulge in activities that are mentioned in it. However, there are certain businesses that require special permission from various departments and ministries of the government.
Now let us learn the procedure of trade license renewal in Dubai.
Trade License Renewal in Dubai
Types of Licenses
The business services in Dubai are divided into 3 trade license categories. They are:
- Commercial license – It is required for conducting all trading activities in Dubai
- Professional license – It is required by professionals, craftsman, tax advisors and business consultants providing services in Dubai
- Industrial license – It is required for carrying out manufacturing practice in Dubai
Documents Required
The following documents are required for trade license renewal:
- A copy of the current business trade license
- Passport copy of all business partners
- A typed BR/1 form
- Ejari Registration Certificate and a photocopy of Tenancy Contract
Procedure for Renewal of Trade License in Dubai
The steps to renew trade license in Dubai are as follows:
Step 1:
A trade license cannot be applied for if the tenancy contract does not have a validity of at least 1 month. Therefore, for license renewal, the firm needs to ensure that the attested tenancy contract by the Ejari has a validity of 1 month.
Step 2:
The license renewal authority in Dubai is the Department of Economic Development (DED). Hence, all the necessary documents required for renewal needs to be submitted to them. You can apply to the DED by taking assistance from IMC group for smooth and hassle-free experience.
Step 3:
After the submission of application, DED issues a payment voucher, which needs to be paid for. After making the payment, the respective authorities grant the renewed license.
How Can We Help?
The DED has provided 3 ways to renew trade license i.e. online, offline and automatic route. Inspite of many efforts by DED to ease up the process of trade license renewal, it is a very cumbersome process for the entrepreneurs. This is where we come in the picture. IMC Group has the expertise and experience to help you with the process of trade license renewal in Dubai.
Our services allow entrepreneurs to focus on the core areas of their business. Whereas, we ensure smooth trade license renewal for their business at a nominal fee. For any information or query, you can reach us via call or email.
- Article
- August 30, 2018
PRO services in Dubai play a significant role in getting a certificate attestation. Attestation is the process of verifying the documents of an individual and authenticating them as genuine by providing a seal or a stamp.
Attestation of certificates is mandatory for those seeking employment in UAE. PRO services help in meeting this requirement along with preparing the documents for submission to the respective department for the purpose of certificate attestation. Once the documents are verified and approved, the UAE embassy attests them with a seal or a stamp. On successful attestation, the application process for employment visa is initiated.
Let us understand in detail how attestation services in Dubai work and its procedure.
- Notary Department
The process of certificate attestation for UAE begins with notary attestation after which the documents are submitted to the Home Department for higher verification.
- Home Department
After receiving documents from the notary department, the Home Department verifies all the documents before submitting them to the Ministry of External Affairs (MEA) for further verification. The personal documents are verified by the Home Department and education documents are verified by the HRD Ministry.
- MEA Attestation
Ministry of External Affairs of India further verifies all the documents and certificates issued by any state of India. Home Department and HRD Ministry also submit documents to MEA for verification. Only after final verification by the MEA, the documents are submitted to the UAE embassy.
- UAE Embassy Attestation
After verification of the documents by the MEA of the applicant’s country, the documents are submitted to the UAE embassy for attestation. The UAE embassy verifies the documents and checks for the Ministry of Foreign Affairs (MOFA) before issuing a visa to the applicant.
- MOFA
After the documents are attested by the MEA of the issuing country, the documents need to be attested by the Ministry of Foreign Affairs (MOFA) of the country where the applicant plans to visit. The documents in the UAE are legalised only after they are attested by the Ministry of Foreign Affairs and UAE Embassy at the applicant’s home country. MOFA attestation process is only for those countries that are not part of the Hague convention.
Bottom Line
IMC Group provides attestation services in Dubai to the applications seeking UAE visa. Our experts ensure a smooth and hassle-free experience in related to attestation services in Dubai. Our services are reliable, fast and less expensive compared to others.
For more information, you can get in touch with us.
- Article
- August 28, 2018
What is the company liquidation process in Dubai?
Company liquidation literally means liquidating or planning to close a company. When a particular company decides to close or stop its functions or undertaking in a particular place, the company’s assets or capital are disseminated amongst the shareholders. Because of the liquidation of a company, its trade license also needs to be cancelled.
In other words, it’s the process by which any Dubai LLC company, a free zone company, or a sole establishment shuts its office and operations and then distributes its assets and properties within its shareholders and creditors if any. This process is also called dissolution or winding-up.
Documents Required for Company Liquidation in Dubai
Dubai government requires specific documentation for company liquidation in Dubai.
- Copy of the license
- Copy of the Memorandum of Association (MOA), with any changes
- Power of Attorney, if any
- Copies of all shareholders’ passports
- Copy of your Emirates identification
- Resolution of the shareholders
- De-registration application form
Liquidators in Dubai
A liquidator is a UAE-based agency that sells a company’s assets to pay off its debts. Once appointed, the liquidators provide a letter of acceptance, draft a statement of affairs and a liquidator’s report to complete the proceedings. The liquidator is responsible for undertaking the following tasks:
- Evaluate assets and liabilities to distribute profits after asset sale
- Regularly provide information to the company’s creditors
- Make sure that all business assets are collected and distributed correctly
- Prepare the statement of affairs and the final report for liquidators
Business Liquidation Services in UAE
Business liquidation in UAE is the process of a company closing down all commercial activities. Various reasons may lead to this.
When a firm’s liabilities exceed its assets, it may become bankrupt and have to shut down. Sometimes, the management may choose to liquidate the company. In liquidation, the company’s assets are used to settle liabilities. Any remaining assets are sold, and profits are distributed among directors and shareholders.
But why is company liquidation required?
In which all situations, do you need to cancel your trade license?
Cancellation of your trade license is an integral part when you are closing your company in Dubai. The following scenarios make it mandatory to cancel your trade license:
- If a company is not earning enough or they can’t carry on their daily operations; or when they don’t have enough funds to pay salaries to their employees or cover the debts.
- In case a company has committed any serious crime like fraud and any Dubai authority has started investigating it and has found some violations of any strict rule or regulations. In such a scenario, the company gets a legal notice for closure.
- If the trade license has expired and hasn’t been renewed. If the company does not want to renew it, then that license needs to be cancelled, or the company will be fined.
Please note that if you once cancel the trade license and close it, it cannot be re-activated again; so you have to be sure of it. In addition, for cancellation of trade license, you have to submit various documents and then get approvals from multiple government and federal authorities. However, the process depends on which type of business license your company had.
- The business owners should get the visas and work permits of their employees cancelled before closing their company in Dubai. The owner needs to give a paid notice of two months to the employees.
- Closure or cancellation of the utilities is also mandatory. For example, cancelling your company’s account with DEWA and Etisalat or du; so as to get back your deposits
- Closure of all company bank accounts and get a letter of clearance from the relevant bank
- Finish or close the lease of the office or warehouse
Steps to be performed before company liquidation in Dubai:
The two stages of cancellation of LLC license in Dubai are:
First Stage of cancellation:
- Give the required notice to all the existing employees.
- Pass a resolution for dissolution of director resolution and then get an appointment of a liquidator, which needs to be attested by a Notary Public.
- Get a letter from one of the appointed liquidators and then submit with along with a License Copy, the registration certificate that is given by the auditor, a certificate that authorizes the signature, and is attested by a Notary Public.
- Fee to be paid to DED for issuing a company liquidation certificate.
- Give a liquidation advertisement in a couple of leading, local Arabic newspapers for a day. Then after a wait time of 45 days in which it is reviewed if there are any claims against the company.
Second Stage of cancellation:
- Submit the original advertisement and final audit report to the DED.
- Present the confirmation of the liquidator and all the partners proving no objection.
- Cancel all visas of the partners. Then get a clearance letter from the Ministry of Labor.
- Submit a copy of Director Board resolution and a copy of liquidation certificate.
- Fee payment to DED for the DED license cancellation.
- Article
- August 28, 2018
When you think of skyscrapers and beautiful skyline, Dubai is one of top names that flash through your mind; isn’t it? Dubai is not only UAE’s most attractive destination because of its pristine beaches, cosmopolitan culture, open spaces, but majorly due to its world-class infrastructure. Other than that, Dubai is an attractive place for not only tourism, but also for its high GDP, tax-free environment and ample business opportunities.
Because of many favourable factors, the demand for official and residential spaces has been spiraling upwards in Dubai. Then the Expo 2020 has also been a reason to see growth in business opportunities and major construction activities.
Opportunities in Construction Business Sector in Dubai
There have been government sanctions of USD 7.8 billion for the modernization and expansion of the Dubai International Airport and also USD 6.8 billion for the development of the Abu Dhabi International Airport.
The government has also initiated many other development projects in the construction sector to boost up travel and tourism sector. The Maritime city has also boosted the construction sector in Dubai. There are also some grand investment plans for the upliftment of transportation infrastructure.
The construction business in Dubai, UAE holds much promise and is very profitable for the investors if the right opportunities are explored.
Forming a construction company in the UAE
Steps to set up a construction business in Dubai
Approvals and Permits Required for a Construction Business in Dubai, UAE
We, at IMC, have a professional and dedicated team to help entrepreneurs and people who want to invest in forming a construction company in Dubai or UAE. Your search for a solution-provider ends with us. We help in business setup in Dubai and also in Dubai pro services real estate tasks. So if you are thinking of launching or registering your construction company in Dubai and are not sure of how to get all the permits, please get in touch with us. We not only assist you in all legal work related to setting up a construction company in UAE, but also provide end-to-end solutions and handle all the mundane tasks required to do this.
- Article
- August 24, 2018
With the growing GCC economy, there surely will be ample opportunities for interior designers in the UAE market. More so, because educated people understand about design and also know what interior designers do and what is the role of architects.
It is forecasted that there will be rapid growth in the design industry in Dubai and Abu Dhabi in the coming years. This is because the commercial sector is booming and there has been a sharp rise of both retail and residential projects throughout the country.
A report from INDEX, the Middle East & North Africa’s largest gathering for the design community, outlines that the GCC Interiors & Fit-Out market is currently valued at US$9.04bn and represents a growth of 4.42%. The overall value of the construction projects in the GCC were touted to be at $76.94bn last year. About 16% of value of any construction project is spent on interior design and furnishings, and hence, this industry could be a very lucrative option for people thinking of entering the market or planning to set up an interior design company in Dubai.
Even 2018 looks promising for this sector because the largest-ever budget has been approved by Dubai government because it encourages spending on Expo 2020, which is a global exposition which gets about 180 countries together with global visitors of over 25 million.
In addition, in 2018, VAT or value-added tax will also be imposed in the six markets in GCC, which will bring in a minimum of $20 billion to the government incomes throughout the Arabian Gulf, which will further speed up growth.
Many businesses use INDEX events to enter the market to meet and network with thousands of exhibitors from across the globe.
How to open interior design company in Dubai, UAE?
To set up an interior design company in Dubai, you can either consider a free zone entity or an on-shore business. Both options differ in terms of the restrictions and the advantages.
In case of free zones, any enterprise conducting activities in the field of interior designing or furnishings is termed as ‘Interior Design Consultancy’, and the activities that are allowed include creating plans and drawings or detailed designs and landscaping for any residential, commercial, or retail buildings, or offices. The two popular free zones in Dubai are Dubai Creative Clusters Authority (DCCA) Free Zone and Jebel Ali Free Zone (JAFZA).
DCCA Free Zone provides an option of Interior Design Consultancy license and also Interior Designer permits for people who are freelance consultants specializing into furnishings and designing architectural interiors.
If you are planning a business setup in the Dubai free zone, you can only perform your business activities within that particular free zone, with other permissible free zones and/or abroad. Hence, the sponsored employees working in a free zone organization are not permitted to work outside the premises, nor the organization, to get any commercial agreement with customers located in the UAE mainland.
However, the Interior Design Consultancy license does not give the organization the permit to get the Customs code for importing furniture or other interior products, which are a part of the project’s concept. Hence, it is advisable to appoint some local agent or distributor.
Please note that all design consultants or companies thinking of a set up in the UAE need a professional license and Dubai Municipality Approval along with proper and relevant degree and experience in this sector.
- Article, U.A.E
- August 24, 2018
If you are thinking of moving to UAE then PRO services in Dubai would be of great help. With effect from March 2016, the immigration department of the country has changed the process of applying for a visa in UAE. Thus, to comply with the changes in laws, PRO services assist individuals to get through the process smoothly. In this article, we will talk about the process of getting residency visa in UAE.
How to Get ResidenceVisa in Dubai?
There are two different ways through which an individual can get a residence visa in Dubai. They are;
Process of Getting Resident Visa by Becoming an Employee or an Owner of a Company in UAE
One of the easiest ways of becoming a resident in Dubai is to become an owner of a company. UAE grants resident visa to all nationalities barring exceptions. The procedure to obtain residence visa in Dubai is as follows.
Step 1: Register 100% expatriate owned free zone company in UAE with the help of IMC Group. The process shall take minimum 2 weeks in case of most free zones.
Step 2: After completion of the registration process, IMC Group shall help you in applying for Investor Visa and Company Immigration Card. The process shall take around 2 weeks.
Step 3: The last step involves undergoing various medical tests like x-ray, blood test, etc. to get the visa stamped on the passport for 3 years. The process shall take minimum 5 to 7 days.
After completing of the above process and obtaining the residence visa, IMC Group also helps in getting Family Visa and Employment Visa. An individual/investor having residence visa can lease or buy property in UAE. We also assist employees in getting Employment Visa by signing an Employment Contract with a UAE company.
Process of Getting Resident Visa by Owning Property Worth More than 1 Million in Dubai
An individual of any other nationality (except from the restricted countries by the UAE government) owning the property of more than AED 1 million in Dubai is eligible to obtain 6 months multi-entry visa or 2-year residency visa. However, an individual cannot work under these visas.
There are certain conditions that need to be complied to in order to obtain 6 months multi-entry visa or 2-year residency visa.
Conditions for 6 Months Multi-Entry Visa for Property Owner
- An individual should own at least one property in UAE whose value is more than AED 1 million
- Only the person whose name appears on the Title Deed can apply for the visa
- The property must be handed over
- The visa should be renewed in every 6 months
Conditions for 2 Years Visa for Property Owner
- An individual should own at least one property in UAE whose value is more than AED 1 million
- The property must be habitable
- The property must be owned without a mortgage
IMC Group is a leader in providing PRO services and assists you in availing residence visa in Dubai. If you have any query or want further information, you can reach us on our contact number or email us and we will be happy to assist you.
- Article, U.A.E
- August 22, 2018
UAE has been encouraging many domestic and foreign fitness companies for investing in their market. The statistics say that the UAE fitness industry in 2016 stood at about $380m. Many well-known fitness companies came and set up their business in the UAE; for example, the famous American brand Gold’s Gym and UK-based Fitness First. Recently with more innovation there in this industry, there has been a shift towards more functional training. Therefore, there are ample opportunities in this sector in the UAE.
What entity to choose to set up a fitness club?
You could set up a fitness club in Abu Dhabi as a limited liability company (LLC) in Abu Dhabi, but there are some compulsory requirements that are listed by the Department of Economic Development, which should be met.
Before opening a fitness club, you must obtain an authorization from the following:
- The General Authority for Youth and Sports Welfare
- The Department of Health
- The Emirates Bodybuilding and Weightlifting Committee
There are some other mandates such as the person who is obtaining the license to open a Fitness Club, should be at least 21 years old or more of age. He/she should also submit a copy of a registered tenancy contract and a memorandum of association.
How to get a license in a Free Zone for a gym or health club?
If you are thinking of opening a health club or gym in a Free Zone, then there are a few regulations that you should know. The activities of the health club or gym that are permissible should only strictly limit to:
- Physical training or exercising for weight loss/ fitness
- Meditative sports like yoga or tai-chi
- Various types of massage
What are the gym license activities that are non-permissible?
The gym license activities which are not permissible would include but shall not be limited to the following:
- No medical or physiological treatments for diseases like rheumatism etc.
- Use of electrical machines for therapy or diagnosis like ultrasound machines etc by untrained or unqualified staff
- Patients having infectious diseases not to be allowed entry or exercise and perform any activity in the fitness center
- Using the fitness center for staff accommodation is not permitted
- Noisy sporting activities and causing disturbance
- No women staff to be employed in the men’s health clubs or fitness centers
- No men staff to be allowed entry to ladies health clubs/fitness centers
Are there any special conditions for setting up a gym?
- Instructors as well as the guests or users of the health club should wear appropriate gym wear.
- All the staff should maintain proper personal hygiene.
- All staff giving massages in the health club should be qualified from DOHMS.
- Weight-loss diets should be only prescribed and also supervised by the qualified nutritionists only.
- The gyms or fitness center should be mandatorily equipped with the following:
- Should be located at the ground floor of a building and its premises cannot be used for any other activities than what is stated in the license
- There should be proper lighting and ventilation as per the given standards; for example, the fitness centre must have fans, exhaust fans and outlets that can cater to the whole premises
- The premises cannot be used for storage or for accumulation of the goods
- A fully-furnished office is mandatory for carrying out the administration role. It should be able to manage activity with 30m²
- First-aid box should be always available
- Cleanliness and maintenance of the premises
- Things like anti-bacterial soap, disinfectant and tissue paper should be available
- Proper cleaning area like sinks and drains should be provided (should be as per the guidelines specified)
- Electric insect killing machines should be installed and regular pest control should be done
- Pedal garbage bins with a lid should be provided
- Employees must be dressed in a proper uniform with the company’s name or logo
- A map with the proper location and address of the centre should be provided
- Smoking should not be permitted in the premises and there must be apt signage informing about the same
The fitness or gym trainers will be required to have valid visas and show their competence and needed qualifications and experience in the industry, besides having a valid trade license.
- Article
- August 22, 2018
Because of the rising population and the current climatic conditions, the demand for water and electricity is growing at a rate of 9% per annum. The energy industry is amongst the top industries in Dubai, which is also a reason to venture into this field.
If you are thinking of setting up a company in the energy sector in UAE, here’s what you need to know. The major laws regarding setting up or establishing a new company in this sector in Dubai are as follows:
- the Electricity Law;
- the Dubai Office Resolution Act;
- the Dubai Electricity and Water Authority Act.
The main authority that provides the licenses and also supervises various energy companies in Dubai is called the Dubai Electricity and Water Authority or DEWA.
What is the process of setting up an energy company in Dubai?
The process of registering a company in the energy sector is similar to that of any other area or type of business. Here are the steps to set up a company:
- Complete the process of incorporation as per the Department of Economic Development
- Then apply and get the necessary licenses with DEWA
- Private sector companies should get a power generation license or a water desalination license so that they can be allowed to operate in Dubai
- Some other special licenses are needed by companies, which deal in the renewable energy sector
UAE has also been in news because of various technological developments in its Energy sector as Dubai Electricity and Water Authority (DEWA) became the first-ever government organization, which launched Rammas, a virtual employee, and used artificial intelligence (AI) technology to respond to and solve customer queries.
The UAE Energy and Power industry is a very lucrative option in terms of investments and even for setting up businesses into renewable energy, and also in the field of providing service to infrastructure, for example, technology, engineering, and other professional services.
What are the advantages of setting up a company in the energy sector in Dubai?
- UAE offers a tax-free environment.
- There are many incentives for companies in the green energy sector.
- There are many loan programs available.
- UAE has many government schemes aimed at various segments of the energy sector.
Where can you set up a company in the Energy Sector in the UAE?
Mainland: Setting up a company in the mainland can be very advantageous. The main benefit is that it offers the flexibility to carry on the trade in any part of the UAE, besides giving unlimited visas and also exemption from business and/or personal taxes. The expenses you could incur in setting up your business in the mainland would depend on the following:
- What is the nature of your enterprise and which license is required? If it’s a commercial, industrial or service-oriented activity?
- What is the legal form of your company? Is it a company or a branch of an existing company?
Free Zones in UAE
Masdar City Abu Dhabi: This free zone lies near Abu Dhabi International airport and has come up as a global clean-technology hub because it places enterprises at the very heart of the global renewable energy and the clean-tech industry. If you set up your business here, you can get a range of benefits like 100% foreign ownership and also exemption from all the corporate taxes.
Dubai Multi Commodities Centre (DMCC): DMCC is a government entity, which was established back in 2002 to improve commodity trade flows going through Dubai. DMCC, a global centre for 14,100 plus businesses, offers many benefits for companies who are thinking of setting up their business in the UAE. It also plays a very important role in Dubai’s goal to be a diverse and dynamic economy.
Dubai Silicon Oasis (DSO): This is a 100% government-owned free zone, which was established back in 2005. Its aim is to aid and encourage modern technology-based industries and therefore support the area’s demand for expansion of trade and business. There are a lot of incentives and advantages that companies get while functioning within this free zone.
What are the entity options for energy companies?
If you are looking to set up a company in the energy sector in the UAE, the following options are available for you:
- Limited Liability Company
- Branch
- Commercial Agency
If you have any other queries and need information regarding how to set up or start an energy company in the UAE, feel free to contact us and we will be happy to assist you.
- Newsletter, Singapore
- August 18, 2018
These days it is imperative for hotels globally to move towards tech-enabled processes so that they can survive and do well in a diluted market. Last year data shows that the hotel occupancy rate went up by 0.5% and stood at 75.1% in the United Arab Emirates (UAE). However, the proportion of the average daily rate fell down by 3.8% last year. The global travel scenario has become more competitive with many new entrants, and the increase of online intermediaries. Today, only those hotels will survive, which will be able to foresee the growing needs of the 21st century, digitally native travelers who are on a look out for unique experiences, said a new report published by Grant Thornton UAE.
The report named Hotel Re-Generate: Mega Trends Impacting Hotels was launched during the 14th edition of the Arabian Hotels Investment Conference held at Ras Al Khaimah (RAK), UAE. This report talks about how UAE hotels can find new business opportunities and expand their market in today’s times marred with tech-disruption, ever-changing socio dynamics and preferences of the guests.
A large share of the travel industry goes to online and mobile transactions, especially given the demographics of a particular region where 40% of the population is under 25. Talking about UAE, where mobile phone penetration stands at 228%, it is expected that the launch of the 5G technology will be a game changer in 2018. The organizations that are slacking behind and who aren’t following the digital movement online would have to bear the brunt of loss of the important customer-behaviour based data, which would be the key to making any strategy.
Majority of travelers (about 86%) consider personalized offers very important while deciding when making a purchase. Using smart and latest technologies like artificial intelligence etc to examine the profile of a guest, their previous buying behavior, social media choices etc to design customized offers helps the hotels in driving mass-personalization and also find fresh opportunities for revenue generation. Having the required data along with investing money in the latest technology and tools could be very rewarding for the hoteliers as the revenue increases by as much as 6%.
Hisham Farouk, who is the CEO and Global Board Member at Grant Thornton United Arab Emirates is of the view that in the coming years, hotels will not remain as as just accommodation providers. Today’s travellers expect much more, and the only way to attract them is by offering a holistic set of solutions and alluring packages. Hotels should use cutting edge technology to make sure that every guest experience is personalized and unforgettable.
Do you know that Dubai ranks as the sixth most-visited destination in the whole world? It is also strengthening its position as a regional business hub. The statistics show that Ras Al Khaimah (RAK) is emerging as the nation’s prized possession, due to its hospitality sector, which is expected to further grow at a forecast of occupied room nights of 35.5m annually in 2019. It stands at a 10.2% compound annual growth rate (CAGR) over the next 2 years.
UAE’s market dynamics continue to spur and challenge the hotels, especially due to the investment landscape, simple procedures of doing business, and entrepreneurial skills of people. Because of these market forces, new competitors and solution providers will continue to rise, which would further motivate hoteliers to innovate and do something new. So this is the right time for a new business setup in Dubai. If you need any professional advice or assistance, do get in touch with us.
- Newsletter, Singapore
- August 18, 2018
Recently, a joint study was conducted by Singapore Chinese Chamber of Commerce & Industry (SCCCI) and PwC and UBS, where about 120 family businesses based in Singapore were studied and surveyed. This study was done to find out how these enterprises were managing transformation in today’s ever-growing business environment. This report named ‘Transforming family businesses’ said that though business transformation was earlier done to be competitive, now it’s even more valid for family-based firms to make their businesses future-enabled.
The changing dynamics do pose many challenges and obstacles, but it also brings with it many opportunities for these businesses to progress, provided they are ready to change and take that risk. Though, many family businesses or enterprises know that there is a need to upgrade and transform their business, they face some challenges in expanding out of the domestic market, accept digitization, or even hiring the next generation.
A Global View
The top three plans for most of the family businesses included expanding to new markets. Over 70% of the family businesses which took part in the survey said that they were planning to expand in other countries or have already started to set up their offices or presence globally.
Especially in Singapore as their market size is very limited and there is a need for local enterprises to look for new markets, revenue streams and customers so that they could remain competitive. But having said that, going into unknown foreign markets could be quite complex. The main challenges faced by these family businesses surveyed includes unfamiliarity with the rules and regulations in that foreign country (20.8%), finding the correct business partner (18.3%) and hiring the right king of talent (16.1%).
To tackle this challenge, these businesses could either leverage their own networks, or try to collaborate with some professional agencies that have experience in doing so.
Coming to terms with the Digital Wave
We are in an age of digital disruption and every family business today needs to re-look at their business models, systems and processes so that they don’t lose out. Though over 85% of family businesses that took the survey said they were open to participating in the digital economy, about 34.7% did not have any concrete plans in this regard. About 36.2% said that finding various ways to transform their business using latest technology was their top-most challenge. About 28% felt that the financial costs involved in digital transformation worried them and 26% said that competitors with first-mover advantages was their top concern.
But it’s important to understand that innovative strategies and digital transformation lays out many new business opportunities.
Bringing professionalism in family businesses
Professionalism is an important element of transformation and it means running the business in a more professional manner. This means bringing in processes and new strategies to improve the value offerings and how attractive the business looks to customers.
It is imperative to also build that mindset so that the business can prepare to drive performance and also eventually deliver value to all its customers and stakeholders. Hence, family businesses need to find areas where they could plug the gaps in skills and decide if they need to hire some reliable professionals who could run their business in the absence of the core team. This way by hiring talent from outside brings objectivity to the company.
Passing the torch
Though it’s a good idea to involve the current generation, it’s also very important to hire professionals from outside to drive and achieve successful transformation. The next-gen is not only more updated and educated, but also more tech-savvy, possesses a global outlook and a capability to lead in today’s digital era.
The business owners should ensure that the most capable person runs the show, even if it is a professional not belonging to the family. About 55.4% of the family businesses who took the survey said that leadership was the most important aspect which the new generation should take over. About 52% felt that the new gen should take over financial management (52.4%) and 50% felt that next gen should handle the emotional intelligence. The seniors in the family businesses should make sure that their children take their company’s credibility to a higher level by sharpening their skills and then bringing their new outlook and expertise back to their family-run business.
The future of all the family businesses depends on how well they collaborate with the younger generation and how they use their capabilities so that they reap the benefits of today’s digital era expand in the market and protect their legacy.
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