Taking the path of starting a business overseas is always risky. However, some places can give you an easier time regarding early success. Undoubtedly, one of those places is Saudi Arabia.
In this article, we prepared a guide to show you how to start a business in Saudi Arabia as a foreigner. Here, you will discover the advantages of the country as a business hub and the steps you must follow. Let us discuss:
- Why is Saudi Arabia the right place for your business?
- What benefits can bring Saudi Arabia to your business?
- Steps to starting a business in Saudi Arabia
- How much does it cost to start a business in Saudi Arabia as a foreigner?
- Where can you find more information about the process of starting your business in Saudi Arabia?
1. Why is Saudi Arabia the right place for your business?
Your process of choosing a location to set up a company should not focus on just one factor. Instead, you can analyze how each option may benefit your plans regarding costs, labor, and more. It will give you a better perspective in picking the best one.
You can also save time and search for the trending hubs for business worldwide. Among the best, you will find several options in the Middle East, with Saudi Arabia leading the pack. Indeed, it is the right place you can choose as your organization’s home.
Above all, Saudi Arabia has one of the most prosperous economies in the region. The country is growing continuously and has one of the higher GDPs worldwide. For this reason, it looks good to put your startup‘s sign on one of its streets.
Saudi Arabia has a lot to offer foreigners that want to increase their revenue. But, you can find it helpful to know the benefits it can bring to your company. Our next topic will tell you everything you need to know about it.
2. What benefits can Saudi Arabia bring to your business?
For both Saudi immigrants and foreign investors, Saudi Arabia is a nation with several benefits to offer. At a social level, the country has a tremendously low crime rate and a substantially high standard of healthcare and education. In other words, it is an excellent place to live and work.
Furthermore, Saudi Arabia is also significantly beneficial from an economic point of view. Indeed, it can offer foreigners sales tax liability and a terrific support network. You can enjoy all this while your business grows in an outstanding economy, even for non-oil-related companies.
On the other hand, the authorities in Saudi Arabia are increasing the ease of performing business in the country. They do this to promote foreign investment with tools such as the investor visa. Consequently, it will keep the nation’s GDP at the excellent levels it is today.
Your investment will be safe and generate revenue quickly in Saudi Arabia. Wait no more and start building your business strategy to begin your stay in the country. We assure you that you will not regret it any day.
3. Steps to starting a business in Saudi Arabia
You may have probably heard the old quote: “you cannot start running without learning how to walk“. In business, it means that you cannot build a company without following the right path. You should know which steps to follow in the process.
In Saudi Arabia, every process regarding foreigners involves several steps, including getting a residence permit. Starting a business in the country and making your way into the nation’s economy is not exempt from it. Nonetheless, it is not the challenging task you may think it is.
To help you, we prepared a list of five steps you must follow to start a business in Saudi Arabia. These steps will not change depending on the company you want to build in the country. So, make sure to understand them adequately.
However, such steps do not include what to do once your starting process is complete. Do not forget to build a business strategy for the future, including hiring an audit firm.
Let us show you the steps you should follow to start a business in Saudi Arabia:
3.1 Choosing your industry
To start this process, you must outline the industry your business belongs in. In Saudi Arabia, such a piece of information reveals the activities that your company can and cannot perform. As any Saudi lawyer will tell you, every industry has its regulation.
Moreover, the industry you choose also indicates where it is better for you to set up your organization. You can start your business in Mainland Saudi or one of the free economic zones. Thus, you must take this step to know which country region you should visit.
Finally, your industry will reveal the legal process you should perform to start your business. For your holding company or else, you can require different licenses and legal entities. Therefore, you have to define your industry to discover which one you need.
Nevertheless, economies like Saudi Arabia are now more diverse than ever before. As a result, you will find many industries to choose from for your foreign investment. It is all about using your business knowledge and instinct to pick correctly.
3.2 Know the local business regulations
Saudi Arabia is a large nation with different business regulations in every region. Namely, you could find yourself with varied rules to follow depending on where you desire to start your business. The main difference is between mainland Saudi and the economic free zones.
For instance, imagine you want to start an accounting firm. If you are in mainland Saudi, authorities will issue you a license only if you have regional headquarters. Do you want to operate as a foreign firm instead? You then will need to work with a local service agent.
On the contrary, starting a business in a free economic zone involves a different journey. In this case, you will need to sign up for a license package. It is the process that foreign companies must follow to establish their branch in the country.
In conclusion, you should not lose focus on how every region in Saudi Arabia regulates its business. Most importantly, you must include factors such as taxation in your research. It is the best way to avoid legal issues in the process.
3.3 Get an investment license
Every foreign business person in Saudi Arabia will need an investment license to operate legally. To start your business, you can request one from the Saudi Arabia General Investment Authority (SAIGA). It will allow you to establish your new company or buy one already in operation.
Assuredly, you will not need such a license if you want to become a digital nomad in the country. Nevertheless, you will not be able to enjoy the advantages of the local economy without one. Therefore, we strongly recommend issuing one and starting investing.
Furthermore, you also need to apply for other legal requirements besides the investment license. Indeed, you must request a commercial registration certificate from the Ministry of Commerce and Investment. You can describe it as the legal ID of your business in Saudi Arabia.
At this stage, your process of starting a business in Saudi Arabia is almost finished. However, you will need additional documentation regarding your company and your residence. Advance to the next subject to learn about them and know what to do.
3.4 Additional documents
The commercial registration certificate is not the only document you need from the Ministry of Commerce in Saudi Arabia. You will also require the Memorandum of Association and the Issuance of Commercial Registration of your company. At this point, you will finish the starting process of your business.
Moreover, you must appoint a General Director for your organization, even if it is a shelf company. Next, he has to provide the following documentation to the Ministry:
- The General Director’s ID.
- Address and Passports for Directors and Shareholders.
- Trade name confirmation’s copy.
- Articles of Association (AOA).
- Bank Reference letter.
At a personal level, you also need to issue a business visa. It will allow you to reside, live, and work in Saudi Arabia.
By all odds, it appears that starting a business in Saudi Arabia is a challenging task. Fortunately, it is a process where Company Formation Saudi can help you tremendously. For instance, you can use our visa services to obtain the business visa we mentioned before.
In short, it takes only four easy steps to go from a dreamer to a foreign investor in Saudi Arabia. So, start thinking about what business you can set up in the country.
Once your business is up and running in Saudi Arabia, it is time to perform a constant follow-up. For example, you need to keep the legal aspects of your organization adequate to avoid problems with authorities. Our legal services in Company Formation Saudi are always at your disposal.
Another aspect that you must follow up closely on is the validity of your licenses and visas. In Saudi Arabia, documents like your business visa are valid only for one year. Thus, keep a reminder of these documents’ annual renewal process in your schedule.
Finally, do not forget to search for ways to keep your business growing every month. In this matter, Saudi Arabia’s economy will present you with several options to achieve it. But, in the end, it is up to you to take advantage of the benefits the country can offer.
4. How much does it cost to start a business in Saudi Arabia as a foreigner?
Determining the cost of starting a business in Saudi Arabia depends on several factors. For example, the number of employees you want to hire for it will influence the cost of your payroll. Logically, large companies have a high expense in this matter.
Otherwise, another big part of the company’s costs is related to its nature. Indeed, you will spend more money starting a car manufacturing company than a store with virtual offices. Above all, it has to do with the technical level of your organization.
Last but not least, the location you choose will also play a part in the cost of your business. For instance, picking a place far from a port will increase your logistical expenses substantially if you need supplies. Therefore, take it into account during your budget analysis.
Luckily, this is a subject where Company Formation Saudi can be of great help. Our services can allow you to adjust your finances to achieve your goals with your current resources. Your business will lead the race from the first lap with our help.
5. Where can you find more information about the process of starting your business in Saudi Arabia?
Today, reaching business success involves making smart and well-thought decisions. One of the most important decisions is where to set up your organization. In this sense, you can follow the outstanding idea of starting a business in Saudi Arabia as a foreigner.
Nonetheless, you will need all the local assistance you can get to avoid problems in this process. Here is where our agency comes to help. With our excellent services, you can start your business in Saudi Arabia in a heartbeat.
Allow our experts to assist you and guide you through this process. Feel free to contact us if you have any questions about our services and packages. Our team is waiting for your call at +971 43 316 688. You can also write us an email at email@example.com where we will gladly answer all your inquiries.