A Concrete Detail on How to Start a Small Business in Saudi Arabia

Published On - August 25, 2022

info Business Setup in Saudi Arabia
start small business in saudi arabia

Having a full proofed plan is ingenious if you see yourself owning a business in the next few years in Saudi Arabia. Market research is eminent when it comes to starting a business, either big or small. In this article, you will find all the details that you will need to start a small business in Saudi Arabia. Let us first recognize the business landscape of Saudi Arabia and the opportunities you can explore while you are at it.

Understand the Saudi Arabian Business Environment

Saudi Arabia is the world’s top oil producer and has the strongest economy in the Middle East. However, apart from being a giant in oil production, the country with its Vision 2030 plan has diversified its economy to reduce dependency on oil and promote other sectors. There are umpteen opportunities in the Tourism and Hospitality sector, the Entertainment and Sports industry, Healthcare and Life Sciences, Information Technology and Digital Transformation, Financial Services, Agribusiness, Renewable resources, and Manufacturing, just to name a few for upcoming entrepreneurs from four corners of the world. The government is working indisputably to attract businesses from around the globe by implementing socio-economic reforms.

Saudi Arabia is undoubtedly one of the most popular hubs for regional and international trade centered at the crossroad of Europe, Asia, and Africa. There has also been significant infrastructure development such as transportation systems, ports, and logistics hubs. Also, there has been considerable investment to make the country an industrial city to support business activities and facilitate trade.

With an overall population of 34 million, Saudi Arabia offers an ecosystem for a large consumer market, thus rendering it one of the best destinations for setting up your business in a foreign land.

Navigating the Legal and Regulatory Framework

Since you are now acquainted with the pool of businesses that you can set up here in Saudi Arabia, it is now time to learn more about how you can set up a business in Saudi Arabia. First, you should understand the different types of business that are available, which might include Limited Liability Company (LLC), Joint Stock Company (JSC), Foreign Company Branch, and Limited Liability One Person Company (LLC), and choose which suits you the best. Once you have made your choice, the next step would be to know all types of licenses and permits that are required for the full functioning of your business. You should know that there are about 20 steps that you will need to follow and complete, the first of which is to apply for the MISA (Ministry of Investment Saudi Arabia) Investment License, which is one of the most important steps.

Here is the complete list of the steps involved during the initial setup of the business:

  1. MISA Investment license
  2. Name Reservation
  3. Drafting and attesting local Articles of Association (AoA)
  4. Issuance of commercial registration (CR)
  5. Registration with the Chamber of Commerce (CoC)
  6. Company Seal
  7. Register with The Ministry of Labor
  8. Registration with the General Organization for Social Issuance
  9. Register for the National Address
  10. Issue the GM Visa
  11. Registration with the General Authority of Zakat and Tax (GAZT) and VAT Registration
  12. Activate the Chamber of Commerce (CoC) account
  13. Health Insurance
  14. Medical Check-up
  15. Issue the GM’s Iqama
  16. Register with the Muqeem portal
  17. Register with the Absher portal
  18. Register with the Qiwa portal
  19. Register with Mudad Portal
  20. Assistance in Bank account opening

We have a blog “A Comprehensive Guide on How to Open a Company in Saudi Arabia as a Foreigner”, where we have written step-by-step instructions for registering a business in Saudi Arabia which you can go through to get more detailed information about it. Please keep in mind that the cost of setting up a company may vary depending on the type of business and is subject to change. For example, registering a limited liability company (LLC) can cost between 65000 Saudi Riyals in the first year and 78000 Saudi Riyals from the second year on, and also will depend on the services that you incorporate.

start small business in saudi arabia

Overcoming Challenges and Ensuring Success

The last thing that remains is overcoming the barriers for your ultimate success, for which we are always here to help. Being a foreign nationalist, it can sometimes be hard to obtain all the regulatory and legal documents, hence it is always beneficial to have someone who can do the hard work for you. It is of immense importance to employ someone who is not only trustworthy but skilled in the profession too. ThinkDirect BPO helps in both Pre and Post set up services while also helping to set up your business in Saudi Arabia. Pre-set-up services include Market entry facilitation, Business partner matchmaking, and Saudi Visas. Post-set-up services include PRO services, accounting services, HR services, and marketing services. Avail one-stop solution from Saudi’s one of the best consulting firms today without any delay. Contact us for more details.