Although this guide is centered on how to open a restaurant in Dubai, you can, however, apply some of the core concepts to setting up your establishment in other parts of the world.
You see, the rules and regulations on how to open a restaurant vary in terms of demographics, but the basic idea and strategies almost remain the same. In fact, take it as a double-quoted “almost” because this guide will not only help you to figure out the best way on how to open a restaurant, but you might as well learn a thing or two from it.
The question is, why are we recommending Dubai, Abu Dhabi, and other areas for opening a restaurant, and not some other fancy-schmancy place?
As it turns out, each year, Dubai sprawls with millions of tourists from all over the world. To be more precise, the tourist count is up north of 4.7 million folks according to ‘Arabian Business’ insiders. In other words, beyond the glitz and glam, Dubai is a go-to hub for people who love to take a dab into the luxuries of the modern world.
For business folks, that translates to 4.7 million opportunities to make a dime. If done correctly, you could be making a whopping percentage on your yearly revenue. That’s all the more reason to set up shop in Dubai, UAE, Abu Dhabi, and other vicinities.
However, as much as these lucrative business opportunities are waiting to be explored, there’s a sense of high cut-throat competition. Dubai, like, many other famous places aren’t cheap for customers.
There’s a specific bracket where you need to line up the shots to see how your restaurant business pans out.
Secondly, without a proper plan on how to open a restaurant in Dubai, your chances are akin to last over a few months. Top it all off with a side of looming healthcare institute policies in the aftermath of the COVID-19 pandemic, the business strategy on opening a restaurant in Dubai has to be laser-sharp and personalized to your upcoming startup.
Here’s how you should get started. Read on…
Dubai & Abu Dhabi Restaurant Startup Mistakes to Avoid
If you don’t have time to skim through the entire post, here’s what you need to know about ‘how to open a restaurant in Dubai’ on the get-go.
a. Get Your Restaurant License In Dubai on Top Priority:
Before incepting, it is extremely important to get your restaurant license in Dubai right away!
This part is detailed later down in this post, but for reference, you should know that the food code is strictly applicable to any type of food business establishment in Dubai, Abu Dhabi, and the UAE.
If you are looking to start a food business in Dubai under the following categories, it is imperative to get the appropriate business license for it.
- Food Factories
- Food Processing
- Food Catering Services
- Food Packing
All of the aforementioned niches belong to different categories of food businesses in Dubai. However, to obtain a restaurant license in Dubai, you need to get a trade license from the Department of Tourism and Commerce Marketing in Dubai, and a Food License from the Food Safety Department in Dubai.
Read our guide below to find out more details about how to get a restaurant license in Dubai and the restaurant license cost in Abu Dhabi. It’ll help you a lot.
b. Have a Stellar Restaurant Business Plan on How to Open a Business In Dubai:
Whether you are looking to start a restaurant business in Dubai, or anywhere in the UAE, a food business plan is fundamentally essential. It elaborates on structural content, such as the location for your restaurant in Dubai, marketing expenses, remote food delivery through Dubai food ordering apps, and various other operations.
Since COVID, many food startups have had to rework their business plan to include new models that would help the business to scale. It is wise to adapt to new market trends and reshape your Dubai restaurant’s launch strategy accordingly.
c. Your Dubai Restaurant Will Not Start Earning Profit Right Away!
Profits are good, but having the notion that your Dubai restaurant will start turning over “easy money” is a false belief.
Our best advice to start a long-lasting restaurant business in Dubai is to set aside funds for scalability purposes. Since many new food business startups are focused on investing too much in ambiance and structure and other things related to the restaurant, they have all the chips bargained for making a profit starting from day 1.
Aspiring restaurateurs are meticulous. Especially, for new food business owners in Dubai, the cost of doing business is pretty high. Rentals break through the roof if the establishment is set up in a posh location. Likewise, raw material cost, utility bills, and staff member payroll are some of the factors that make it harder to break even.
Start small; take baby steps, and focus on building your restaurant’s credibility in Dubai. We can guarantee that profits will eventually start rolling in.
Do You Have a Business Plan on How to Open a Restaurant in Dubai?
Like any other business, Dubai also requires a few requirements that have to be met. However, before we delve into that, the most important thing is having a business plan on how to open a restaurant.
Business plans are important because they roughly lay down the groundwork as far as how everything is supposed to go.
Besides providing an expense estimate, such plans are effective as they highlight the pros and cons of how to open a restaurant in a specific location. For instance, some places in Dubai attract relatively more customers, but the rentals are equally high. The prime hotspots for high-stake restaurant customers with an equally high percentage of walk-ins are for these locations in Dubai:
- Dubai Creek
- The Mall of Emirates
- Emirates Hills
- Al Quoz
According to ‘The Restaurant Times’ online magazine, an ideal location for a restaurant is an often ignored fact that is not accounted for when new startup owners are working on how to open a restaurant in Dubai or any other place for that matter.
Now, speaking of having a rock-solid business plan to start with, we wrote an extensive guide on How to Write a Restaurant Food Business Plan that Actually Works.
The main takeaway from that post is highlighted below:
- Identifying your name-brand restaurant’s available opportunities and weaknesses
- Competitor analysis on how to open a restaurant in Abu Dhabi and Dubai before getting started
- The big Do’s and Don’ts of startup restaurant servicing protocols
- Running and managing marketing campaigns effectively for any restaurant operating at a small level
- Creating your very first menu
- Surveying the market in terms of how other restaurants in the Middle East are operating amidst COVID-19
… so on and so forth. The above highlights are just the main focus areas that help to alleviate pain points for any potential business in Dubai, especially if it’s food-related.
However, we need to divert your attention to adapting healthcare policies in the wake of the COVID-19 pandemic situation.
That sounds like a fancy idea, and ideally, it’s pretty much the next logical move as soon as the business plan for the restaurant is created.
Quite naturally, since it’s a startup, business owners are strapped for cash. They need all the extra help to get started. That’s where angel investors come in. Speaking of that, yes, there’s a detailed guide on whether you should involve an angel investor from the get-go during a restaurant inception frenzy.
While angel investors sound like a great idea, to begin with, many potential startup business owners considering how to open a restaurant fall for the honey trap. These individuals don’t pay a high degree of attention to the actual agreement between the investor/stakeholder and the restaurant ownership party.
Here’s what you need to know about involving angel investors in your food business startup:
- Pay attention to the APR percentages in your agreement with the investor:
APR otherwise means an annual percentage rate that accounts for additional money off of profits over any fiscal period. Since angel investors expect high returns, food business owners in Dubai are often crushed by heavy payments to the stakeholder party.
The business buckles down under such strenuous agreements and both parties stand to a halt without any indication of moving forward. If you think that this was the worst-case scenario on how to open a restaurant in Dubai or Abu Dhabi by partnering up with an investor, here’s the fun part. Read on…
- Always Detail Loss Equity for Both Partners:
Investors care about how their money should be protected in case the restaurant business plan goes awry within a few months. That’s why, they tend to sneak in clauses that state down that in case of business failure, the investor gets to have all his money back without any share in the loss percentages on the business owners’ part.
In such instance, you’d have to return all the principal amount despite suffering a loss on your brand-new food restaurant business in Dubai, the Middle East, or any other part of the world.
Therefore, consult with a lawyer and have him go through the draft policies on how to start a restaurant that you either made yourself or asked someone to do it. Either way, any level of expert insight is better before signing off right away.
Getting a License for Your Restaurant in the Middle East/ Dubai:
Here’s the fun part.
As soon as you have finalized your business plan on how to open a restaurant, it’s time to shift gears. The next step is to obtain a license from competent authorities in Dubai.
Speaking of which, there are two main categories of licenses that you need to go for. Procure them both on priority, and everything’s hunky-dory from the UAE government’s approval side. Well, at least for now, it is.
- Trade License for Setting Up ‘Shop’ in Dubai
- Food License for Restaurants in Dubai
Both licenses incur a nominal fee that is mandated by the UAE government.
For a trade license regarding your next step on how to open a restaurant in Dubai, contact the authorities from the ‘Department of Tourism and Commerce Marketing’. The pre-approval application from your side clearly needs to mention the kind of restaurant you’d be founding in Dubai.
As far as cost goes, a Trade license can be obtained for anywhere between AED 40,000 to AED 30,000. This cost also factors in the type of restaurant that you’re going to own and operate within the next few months.
Fun Fact: Greasing a few palms will help you to get a trade license for opening a restaurant in Dubai, Abu Dhabi, or other regions relatively fast. However, you’d have to pay a small extra fee that depends on the number of palms you’d be lathering up to escalate your license approval and grant process.
Therefore, if you’re short on cash, we recommend going the usual way and wait for your approval to be sanctioned.
Main Steps to Obtaining a Trade License for Opening a Restaurant in Dubai:
- Identify your corporate activities that the restaurant is going to be engaged in. The government allows up to 10 different activities per license.
- Identify the nature of the industry your restaurant will be operating in. The main industry categories are Professional, Industrial, and Commercial.
- Outline the legal status of your restaurant enterprise business in the United Arab Emirates.
- Come up with an attractive trade name for your restaurant. Please note that it’s not important for your trade name to be as same as your brand name. You can maintain different brands under a trade name easily.
- Submit your Trade License application and get an office on lease meanwhile.
- You will be contacted for additional documents if deemed necessary.
- Fulfill the extra requirements and submit those through reference DED letter to the Department of Tourism and Commerce Marketing in Dubai.
Getting a Food License for Your Restaurant in Dubai, Abu Dhabi, Middle East Etc.:
As far as licensing goes during your how to open a restaurant in Dubai pre-rituals, you need to approach the ‘Food Safety Department’ for a Food License. This part comes after you have successfully obtained a Trade License because the food license granting authority will ask you to procure a Trade License and submit its copy during the approval process.
The food safety department will ask you to submit the following documents. Depending on the nature of your restaurant’s operational category, you may or may not be asked for additional documentation. As far as the general gist goes, here’s what you need to know:
- A valid copy of your Trade License. As mentioned earlier, this license has to be obtained before applying for a Food License.
- Detailed insight on the interior design and layout of your restaurant.
In other words, it’s the blueprint for your restaurant. If you devised a robust business plan on how to start a restaurant anywhere in the Middle East, the blueprint requirements should have been followed by now. Procure and present the blueprint before Food Licensing authorities in Dubai to help them identify:
- Entry and Exit points of your physical name-brand restaurant.
- A dedicated space where you will be processing food.
- Dedicated space for storing processed and/or raw food.
- Ventilation system and installation of other facilities in adherence to general public health guidelines.
- Dedicated space highlighting kitchen area, maintenance area (if any), equipment storage facility, etc.
That was the easy part on how to open a restaurant in Dubai. The next step is considered more of an additional requirement that may or may not be applicable to your food business establishment.
These licenses might be needed in addition to Food and Trade licenses.
- License/ Permit for Pork-based food items.
You don’t have to have a pork permit in Dubai for your restaurant if you’re looking to serve customers with Halal food only!
- Vehicle permit for delivering or transporting food-related products.
- Liquor Permit
Once again, just like the optional pork permit, a liquor permit is not entirely needed if you have decided to go with the Halal food menu for your restaurant in the Middle East.
If you require a liquor license, you can contact the authorities at Al Tamimi and Company for obtaining a liquor license in Dubai for your restaurant. There are other companies too, but Tamimi Co. happens to be a well-known entity in helping owners with such predicaments.
Blink is your #1 Online Ordering Platform for Restaurants
How to Open a Restaurant with a Unique Concept In Dubai?
Speaking of uniqueness, this whole process is outlined as the potential USPs for your restaurant.
What exactly is a USP for business? In layman terms, it’s the ‘Unique Selling Point’ for your food business that goes parallel to driving the competition away.
Since USPs are a strong part of how to open a restaurant in Dubai or any other part of the world, they are crucial to help you gain an upper hand. The industry is already way too competitive by now, and it doesn’t take long for new food business startups to diminish within a few months.
- Restaurant Ambiance
- Food Menu
- Overall Servicing Protocols
The above three categories will help you to come up with your own unique style, available food choices to your customers, and how fast you are able to service them.
The most important thing in this entire debacle is the cost factor associated with all of the above scenarios. Ambiance comes with architecture that’s tied to the amount of cash you are looking to spend on how to open a restaurant in Dubai.
Likewise, servicing is related to hiring and training staff and upkeep maintenance expenses for your Dubai-based food business. Placing such lucrative servicing modules effectively isn’t that a big deal if it weren’t for a high feasibility factor to account for.
What if You Had a Simple Centralized Solution for Reducing Your Dubai Restaurant Cost to an All-Time Low?
For startups, it is not easier to figure out how to open a restaurant without overspending on all the extra things that may be deemed unnecessary in hindsight.
For instance, servicing is the kind of area that can be managed effectively without breaking the bank. And so are other aspects if you have made the initial investment in the right type of technology when considering how to open a restaurant the right way.
Blink: A Centralized POS System for Mitigating Extra Expenses
A POS system is part of the online food ordering technology that shadows different aspects of the restaurant.
Fortunately, Blink Co. comes with not only the POS-related perks – i.e., the point-of-sale technology advantages, but many other variables that enable new food business startups to reduce their operational cost.
Since it is physically impossible for new restaurant owners to monitor and supervise the establishment’s departments on daily basis, it is nonetheless wiser to rely on backend technology for doing the same – and that too within a moderate time limit.
Blink Co. is a restaurant management system for name-brand business owners and new food startups that wish to keep an eye on their daily operations.
From a cursory point of view, Blink for Restaurants offers some of the best advantages to new businesses as compared to conventional companies that have been in the game for several years now. With BlinkCo’s technology at your disposal, here’s what you can expect from it:
- A dedicated POS system for managing Billing, pushing orders, stock and inventory management, and more.
- Your very own white-labeled interface with intuitive restaurant branding and identity management tools for both backend and front end users.
- SaaS-based payment model where restaurant owners like you pay a monthly fee for using Blink Co.’s services instead of having to pay a flat commission on a per order basis.
This type of agreement will help you to double down on your hard-earned pennies without leaking cash on fulfillment to commission-based order percentages.
- Robust reporting system to highlight real-time restaurant customer activities ranging from rush hour ordering times to marketing tools for maintaining a higher business presence in the Dubai restaurant industry.
- Fleet management apps and rider-specific app interface with GPS tracking to effectively manage your order delivery system.
- Lightning-Fast Menu Creation system for setting up your very first food menu without having to be tech-savvy for that matter.
… and about a bazillion other perks are waiting to be explored at Blink for Restaurant platform.
There’s Always Room for Your Fantastic Eatery to Open Up!
At the end of the day, despite high competition and millions of people going to old restaurants, the Gulf continues to present opportunities to new startup owners. It’s all about being patient, resilient, and developing a thick skin to withstand adversity.
Speaking of tolerance to adversity and adapting to rapid shifts in how to open a restaurant in Dubai quantum, you will be overwhelmed with complex decisions. The best way of maintaining a steadfast approach to such instances is through patience and commitment. Both of these virtues serve as a baseline model for any business that is ideally expected to last for several decades on end.
Having said that, it’s better to launch your restaurant today, instead of waiting for the perfect moment. Of course, where there are challenges, startup business owners require mentorship and an occasional nudge in the right direction. That’s why we encourage you to share your concerns through the comments section below. Alternatively, you can also write to us with your ‘how to open a restaurant business’ related queries at firstname.lastname@example.org
Blink is your #1 Online Ordering Platform for Restaurants