Why your current trade license is more valuable than you realize: A customer recently questioned us, “Could it be more cost-effective to start a new business rather than renewing an existing license?” – When you inquire about the source of this information, you will discover that it was a marketing ploy utilized by certain fly-by-night business formation companies to line their own pockets at the expense of their customers’ best interests.
YOUR EXISTING TRADE LICENSE IS WORTH MUCH MORE THAN YOU BELIEVE! Continue reading to learn about the intangibles related to the life of your trade license!
1. Bank and regulatory credibility
A corporate bank account is the most important necessity for a corporation. With increased compliance requirements at the Central Bank level and banks themselves becoming more demanding with their account opening procedures, regulators and banks are more at ease with long-established enterprises that have a proven track record. Remember that a new license signifies a new firm in the perspective of the bank. Do not believe that you may transfer your bank account from one license to another. This is a requirement of the UAE Central Bank and is not even controlled by the banks themselves.
2. Market reputation and long-term stability
Consider how confident you would be if every time you interacted with a vendor, they changed their name and trade license – how sure would you be if you had to pay them an advance? We’re sure it’s not very comfy. A license that is renewed year after year demonstrates the business’s stability and gets the trust of your vendors and consumers, who regard your company as someone they can rely on for their needs and money.
3. Inconsistency between the period of a commercial license and the duration of a visa
A well-known truth is that a trade license is renewed annually, but a visa is only renewed every two or three years. A developing firm constantly requires a team of talented workers, many of whom have families or dependents. If you followed the disinformation of conflicting company formation entities and formed a new company instead of renewing your current trade license, you would soon find yourself spending over 50-70 percent more on visas than if you had stuck with your existing trade license.
4. Increases business growth
Businesses require money to scale up to the level of a Facebook or an Amazon. Whether you are raising funds from banks/financial institutions, private equity, angel investors, or are in the process of being purchased, they all want to know that the firm is legally owned and has a lengthy history to assure the security of their investment. Needless to say, with a new trade license or if you’ve been caught switching businesses rather than keeping a consistent track record by renewing your existing license, it’s doubtful that you’ll obtain the confidence that a bank or investor would demand when investing in your company.
5. Save time and lessen your reliance on shifting rules.
Some businesses go through a tedious process to obtain specific activities in the trade license, and the last thing they want is to be misled into opening a new company and not only going through the tedious process all over again but also not being guaranteed the required activities in your license, which would bring the business to a halt. By renewing your current trade license, you may save the most valuable commodity of all – TIME – by avoiding the need for preliminary permissions and enabling yourself to focus on running your business.
The less time you waste the faster the job is done. Click here to find out why speed is everything in business.
6. Charges for uninformed cancellations
What ignorant company formation entities may not tell you is that the price of canceling your business license and visas, when combined with the cost of a new license, will most likely considerably outweigh the rates of merely renewing your license. Leaving aside the intangible factor, it makes greater financial sense to renew your existing trade license.
By now, you will have realized that the perceived value of your existing license is far greater than you could have imagined, and because we understand the tireless effort, time, and investment that goes into starting and growing your business, we don’t want you to fall victim to incorrect information that could jeopardize your business’s future.
We, at Corproots, can help you with the entire process of trade license registration as well as renewal. Some of the other services provided by us are Business setup in Dubai, Company formation in Dubai, Company setup Dubai, Dubai free zone, Pro, services Dubai, Trademark Registration Dubai, Iso certification in Dubai, Accounting Services. Visit our website to know more about our services.
Related article: The advantages and disadvantages of a trade license vs a freelancer permit
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