Business Setup Quotient (BSQ)

Business Setup Quotient (BSQ) is a self-assessment tool which may help aspiring entrepreneurs to get an indication about their preparedness to start a business in Dubai or anywhere else in the world. Fulfilling the legal procedures related to Business Setup in Dubai is relatively easy. But, leading a start-up to the success path is the most important and difficult task. The success of any business depends on the entrepreneur’s ability and preparedness to minimize surprises. Many entrepreneurs start business in Free Zone and Mainland jurisdictions in Dubai and other Emirates in UAE without ensuring their readiness to setup and grow a business. Self-assessing your Business Setup Quotient (BSQ) can help to realize whether you have taken in to account all relevant success factors, before starting a business.

The concept of Business Setup Quotient (BSQ) has been founded on ten key factors identified as critical in deciding the success or failure of a start-up. Those
key factors are Personal Attributes, Business Idea, Business Plan, Marketing Plan, Capital & Other Resources, Financial Plan & Estimates, Economic and ` Political Environment, Industrial Scenario and Family Support. From my professional experience, I believe that all aspiring entrepreneurs should ask a number of questions related to the above factors to themselves. The response to those questions will give a cumulative answer to the million dollar question: Am I ready to start a business in Dubai or anywhere else?

Business Setup Quotient (BSQ) – Test Module
In order to arrive at the Business Setup Quotient (BSQ), I developed a test of 100 simple questions. These questions are intended to assess whether the respondent has the required personal traits, knowledge, experience, information, plans and resources to start and develop a business successfully. While developing the test module, all the above referred factors are ‘not given’ equal weightage. That means the number of questions related to each factor is different.  All questions in the module are given equal weightage; that means the maximum marks attributed to each question is the same.

For each question, a choice of four answers (A, B, C, D) are given. The respondent can select one answer from the options given. After writing answers to all the questions, the respondent can assign the respective score to each answer as given in the “Score Card” at the end of the test module. Then, add up the score received for all answers to arrive at the ‘total score’.

The maximum score to an answer is 4 (Four) and the maximum total score of the test is 400 (Four hundred). If a respondent is sure that a particular question(s) is not applicable for his business, skip those question(s) and reduce the maximum total score proportionately (Number of questions skipped x 4 (four) points) to arrive at the adjusted maximum total score.

After arriving at ‘total score’ and ‘maximum total score’ or ‘adjusted maximum total score’, you can proceed to find the Business Setup Quotient (BSQ). It is nothing but your total score as a per cent of maximum total score or adjusted maximum total score.

Business Setup Quotient (BSQ) = (Total Score / Maximum Total Score or Adjusted Maximum Total Score) x 100

After arriving at the Business Setup Quotient (BSQ), you can interpret it using the ‘thumb rule’ given at the end of this test module. This test is not intended to give any conclusive answer about the possible success or failure of your proposed business. It only intends to give an indication about your level of preparedness to start a business or the shortcomings in your preparation or the significant factors missed your attention. So, BSQ can be taken as a clue to improve and complete your preparation to become a successful entrepreneur.

Test your Business Setup Quotient (BSQ) to know whether you are ready to start a business in Dubai.

Q.1. Why are you planning to start a business?
A - I am very passionate about my business idea
B - I want to implement my idea
C - I want to be independent
D - I want to make more money
(The motivating factor behind your decision to setup a business has great significance in the success or failure of the proposed business.)

Q.2. Do you have any relevant experience in the business that you are planning to setup?
A - Yes, I am quite experienced
B - Yes, I have reasonable experience
C - Yes, I have a little experience
D – Sorry, I don’t have any experience
(An entrepreneur with relevant experience in the same or related industry will be in a much better position to manage the start-up company to the success way.)

Q.3. How would you rate your team skills?
A - Very Good
B - Good
C - Reasonable
D – Poor
(Team management skills will act as a great help in your endeavor to start and grow a company in Dubai or any other place in the world.)

Q.4. How would you rate your interpersonal skills?
A - Very Good
B - Good
C - Reasonable
D – Poor
(In business, we are dealing with people. If your interpersonal skills are exceptional, that will be a great help for setting up and establishing your dream business.)

Q.5. How would you rate your problem-solving skills?
A - Very Good
B - Good
C - Reasonable
D – Poor
(An entrepreneur has to face diverse problems on a day to day basis, especially during the initial years after business setup. If you are good at problem-solving, which will be an advantage in your journey to become a successful entrepreneur.)

Q.6. How would you rate your motivation level?
A - Very High
B - High
C - Moderate
D – Low
(At the time of business setup in Dubai or anywhere else, all entrepreneurs appear to be motivated. Keep yourself motivated even during the adverse phases is the key to success.)

Q.7. Rate yourself as a person who can work without any supervision.
A - Very Good
B - Good
C - Reasonable
D – Poor
(Most of the successful entrepreneurs are self-starters who can work on own initiative without any supervision.)

Q.8. Rate your ability to take objective decisions.
A - Very Good
B - Good
C - Reasonable
D – Poor
(As an entrepreneur, you may be required to take many significant decisions during the lifecycle of the business. So, it is very important to gain the ability to take objective decision in an unbiased manner.)

Q.9. Your competence to find practical solution for complex problems in business.
A - Very Good
B - Good
C - Reasonable
D – Poor
(When you face a problem in business, people suggest so many solutions. Finding viable and practical solution is the most important thing.)

Q.10. Rate the “man of initiative” in you.
A - Very Good
B - Good
C - Reasonable
D – Poor
(Starting a company in Dubai or any other place in the world requires a great degree of initiative. Keeping that initiative throughout is most important for ensuring the success of your business.)

Q.11. How resilient you are in the most adverse situations?
A - Very Good
B - Good
C - Reasonable
D – Poor
(Your ability to withstand the most adverse situations and challenges is very important in leading the start-up to the growth way.)

Q.12. Your risk tolerance.
A – Very High
B - High
C - Medium
D – Low
(If you wish to start a
business in Dubai or any other place in the world, make sure that you have sufficient risk tolerance. An entrepreneur is rewarded for the risk taken by him.)

Q.13. Please rank your passion for the business idea.
A – Highly passionate
B - Passionate
C – Reasonably passionate
D – Not passionate
(If you are absolutely passionate about your business idea, you will do everything possible to make it a grand success.)

Q.14. You are comfortable working for a fixed time schedule than achieving the target?
A - No, I find pleasure in reaching my target
B – I am ready to work beyond schedule, if required
C - I like to balance work schedule and my target
D - I am comfortable working for fixed time schedule
(Entrepreneurship asks for an entirely different mindset, effort level and work schedule.
Start your own business only if you are prepared to put that extra effort and time.)

Q.15. How many years are there for your retirement?
A- 30 years and above
B - 20 to 30 years
C - 10 to 20 years
D - 0 to 10 years
(Starting a business during the early stages of life has some definite advantages.)

Q.16. As a person, what about your perseverance?
A- Very Good
B - Good
C - Reasonable
D – Poor
(Consistently giving the best effort to achieve the desired result will ensure success in business and life.)

Q.17. Do you chase a target till you reach there?
A - Definitely
B - I do
C - I may
D - I am not sure
(In business everything need not happen overnight. So, chasing the target till you reach there is very important.)

Q.18. Do you take arbitrary decision on the basis of intuition?
A - Never
B - Rarely
C - Occasionally
D – Usually
(Taking arbitrary decisions without proper analysis is not the quality of a successful entrepreneur.)

Q.19. Do you review actual progress in comparison with plans and targets?
A - Yes always
B - Most of the time
C - Occasionally
D – Rarely
(Many entrepreneurs start business with a plan. Unfortunately they won’t review the progress and take corrective actions.)

Q.20. Are you comfortable admitting a fault and correcting it?
A- Indeed, always
B - Most of the time
C - Sometimes
D – Never
(Committing a mistake is not a crime. Not accepting and correcting a mistake is definitely a crime.)

Q. 21. Do you ever commit same mistake repeatedly?
A - Not at all
B - Rarely
C - Sometimes
D – Usually
(Successful entrepreneurs never commit the same mistake again and again. They will rectify the mistake in the first instance itself.)

Q.22. Do your educational and professional background support the new business?
A - Directly support
B - Indirectly support
C - Relatively support
D - Not support
(If you are planning to start a business in a field related to your academic or professional background, it’s great.)

Q.23. Cash source for supporting family during the initial years of your business.
A - From other regular income sources
B - From own savings
C - From spouse’s savings
D - From personal borrowings
(Aspiring entrepreneurs should be aware that it will take some time for the business to generate return. Meantime, he should have alternative cash source to support family’s requirements.)

Q.24. How long can you support family without any income from the new business?
A - 5 years and more
B - 3 to 5 years
C - 2 to 3 years
D - 0 to 1 year
(The answer to this question will be a great help during your planning stage and while taking the vital business setup decision. If your business is able to generate sufficient return within this period of time, you will be in a much better position to start and grow the new business.)

Q.25. Do you have any other sources of income?
A - Yes, I have another secured fixed income source
B – I have another matured flexible income source
C – I have another volatile income source
D – I have no other income source
(Existing multiple sources of income will definitely give you more confidence to start a new business.)

Q.26. My cash and bank reserves are sufficient to meet family expenses for:
A - 3 years and above
B - 2 to 3 years
C - 1 to 2 years
D - 0 to 1 year
(Sufficient free cash and bank balance can give you confidence to start the new venture.)

Q.27. Can your family adjust with your work schedule?
A - Yes, very much
B - They will cooperate, if required
C - They will adjust depending on the situation
D - They will not
(The entrepreneur’s work schedule will be different from that of an employee. If your family is willing to give-up a portion of their right, it’s great.)

Q.28. Would your family offer support during the ups and downs of the business venture?
A - Yes, Indeed
B - Most of the time
C - Sometimes
D – Never
(A start-up will definitely face ups and downs during the initial years. Your family’s support will help you a lot to keep focused in the new business.)

Q.29. How many alternative income sources are there for your family?
A - Three and more sources
B - Two sources
C - One source
D - No other source
(Alternative income sources will definitely a great help in your journey to become a successful entrepreneur.)

Q.30. Do you forecast any major family expenditure in the coming three years?
A- Not at all
B - Very rarely
C - Some times
D – Yes
(If you don’t foresee any major family expenditure in the near future, that’s great news as an aspiring entrepreneur.)

Q.31. How convinced are you about the business idea?
A- 100% sure about the success of my business idea.
B - 90 to 100 percent
C - 80 to 90 percent
D - 0 to 80 percent
(If you are not convinced about the business idea, there is no point in trying to convince others.)

Q.32. Do you see a practical business in your idea?
A - Yes, definitely there is a practical business in this idea
B – Yes, I am almost sure.
C - There is a possibility of a business in it.
D - Not sure
(All good ideas need not have a practical business in it. Before setting up a business in Dubai or any other place in the world, ensure that there is a viable business in the idea.)

Q.33. Do your idea solve any existing problem or requirement?
A - Solves a problem which has no solutions at present
B - Solves a problem which has limited solutions at present
C - Solves a problems which has many solutions at present
D - Do not solve any problem
(If your business idea solves any of the problems or requirements of the users, there is a possibility of finding a market for that.)

Q.34. Rate the superiority of your solution compared to competition?
A - Cost Effective, Efficient, Simple
B - Cost Effective, Simple
C - Efficient, Simple
D - No Superiority
(If your new business offers a product or service which is superior to competitor products, there is a greater possibility of winning the market.)

Q.35. Do you have competitors in the market?
A - No competitors
B - One or Two Competitors
C - A few Competitors
D - Many Competitor
(If there exists tough competition in the market, spend more time on your marketing plan and strategy before jumping into Business Setup.)

Q.36. Is your product or service unique which can be protected by IP Rights?
A - Yes, Indeed
B - Sure
C - Probable
D - Not Sure
(If your product, service, process, design or technology is unique which can be protected by intellectual property rights, which will definitely help your start-up to establish in the market.)

Q.37. Do your product or service has recurring demand from customers?
A - Recurring
B - Frequently
C - Occasionally
D - Once in a while
(If the product or service offered by the start-up has recurring demand, customers can be retained through proper pricing, quality etc.)

Q.38. What is your estimated customer retention ratio?
A - 90% and above
B - 80 to 90%
C - 60 to 80%
D - Less than 60%
(Retaining customers is very important for both start-ups and well established business.)

Q.39. How easily scalable, the new business?
A - Can be scaled up for minimum batch size without cost impact
B - Can be scaled up for minimum batch size with a little cost impact
C - Can be scaled up for only a higher batch size with cost impact
D – Difficult to scale up phase by phase
(If your proposed business is scalable, that will give you sufficient time to build the volume, infrastructure, capital and other resources stage by stage.)

Q.40. How long will it take to reach Break Even Point (BEP)?
A - 0 to 1 year
B - 1 to 2 year
C - 2 to 3 year
D - 3 years and above
(Break Even Point is the level of sales at which there is no profit or loss. It is always better as soon as you reach the BEP level. After the BEP level of sales, your business starts generating profit. So, it is very important for the entrepreneur to know the BEP (Sales in Value and Volume) and BEP (Period – estimated time when the business reaches BEP).)

Q.41. As an end user, are you excited about the product or service of the new business?
A - Very Excited
B - Excited
C - Reasonably
D - Not at all
(If the end user is excited about your product or service, naturally there will be a market for it.)

Q.42. is it possible to start the new business anywhere with standard facilities?
A - Anywhere with standard facilities
B - In all places with specified facilities
C - Only in a specific geographical location
D - Only in specified geographical area with specified facilities
(If your business can be setup anywhere with standard facilities, which will offer a lot of flexibility and cost advantage.)

Q.43 - Any cost effective or superior alternative to your product available in the market?
A - No
B - One or two
C - A few
D – Many
(If superior alternatives are available at cheaper price, customers will naturally get attracted to that.)

Q.44. Do you have a clear plan for product improvement and quality up-gradation?
A – Yes, I have a clearly defined plan
B – I have a basic idea about that
C – I am thinking about that
D – I haven’t thought about that
(Successful entrepreneurs consistently strive to upgrade their product and quality in accordance with the requirements of the market.)

Q.45 Environment laws or regulations which affect your business?
A – No laws or regulations
B – Only normal regulations
C – Moderate regulations
D – Strong regulations
(If your proposed business segment is subject to stringent environment laws and regulations, as an entrepreneur you should consider those requirements and the associated cost impact.)

Q.46. Do quality certifications or other certifications mandatory for your business?
A - No quality certifications are required (not mandatory)
B - One or two required (optional)
C - One or two stringent certifications are required
D - Many stringent certifications are required
(If ISO and other certifications are mandatory to become qualified vendors, aspiring entrepreneurs should consider the technical requirements, cost and time for getting the certification.)

Q.47. Did you conduct a serious study about the industry, technology, products and market?
A - Yes, conducted a detailed study by an expert
B - Yes, conducted a preliminary study by an expert
C - Yes, conducted a basic study by myself
D - Not conducted any study
(Before starting any business, you should seriously study the industry, market, product and technology. That will help you to take informed decisions.)

Q.48. How long you are following the proposed business and industry?
A - More than 5 years
B - 3 to 5 years
C - 1 to 3 years
D - Less than 1 year
(Setup Business only after closely following the business and your industry for a few years. That will give more insight on the trends, developments and issues in the industry.)

Q.49. Did you prepare a comprehensive business plan?
A - Yes, a full-fledged business plan
B - Yes, but not exhaustive
C - Yes, prepared but not professional
D - Not prepared one
(A comprehensive business plan is a pre-requisite to start a successful business. Your business plan should cover all important aspects related to business.)

Q.50. Rate the chance of your customers ‘not ‘coming back.
A - No chance
B - In some situations
C - In many situations
D - In most of the situations
(As an aspiring entrepreneur looking for Business Setup, you should also look into the factors that may influence the customers not to come back.)

Q.51. As a quality conscious customer, rate the quality of your product or service?
A - Very Good
B - Good
C - Reasonable
D – Poor
(If your product or service is convincing and satisfactory to a quality conscious customer, there is greater chance of you winning the market.)

Q.52. Are you planning to offer any free after sale service?
A - Yes, Full Service
B - Only Major Services
C - Only Minor Services
D - No Free Services
(Free and efficient after sale service will naturally help a start-up to establish in the market.)

Q.53. What kind of warranty coverage that you are planning to offer?
A - Spares and Service Completely Free
B - Service Free and Spares Paid
C - Both service and spares partly free
D - Only minor services are free
(Full and free warranty coverage shows your confidence on your product or service. Naturally that confidence will be infused in the market.)

Q.54. Ratio of warranty claims that you expect during warranty period?
A - Less than 5%
B - 5 to 10%
C - 10 to 20%
D - Above 20%
(Many entrepreneurs fail to calculate many indirect cost of operating the business at the time of the Business Setup decision. Warranty claim is one of such indirect costs. By considering warranty claims, you will be in a better position estimate the realistic net profit of your business.)

Q.55. How many years’ detailed business plan you have prepared?
A - 5 years or more
B - 3 to 4 years
C - 2 years
D - 1 year
(Many aspiring entrepreneurs commit a mistake of starting a business without preparing a business plan. A detailed business plan for 5 years can act as a roadmap in your journey to establish a successful business or company.)

Q.56. How realistic is your business plan?
A - Absolutely realistic
B - Realistic
C - Reasonably realistic
D – Unrealistic
(There are entrepreneurs who prepare ornamental business plans to satisfy the legal requirements or FIs or banks. Those business plans will be far away from reality and it won’t serve any purpose. Successful entrepreneurs prepare realistic business plans and use it as a roadmap to start and develop a successful business in Dubai or any other city.)

Q.57. Is your business vulnerable to technological changes?
A – No impact
B - Only limited impact
C - Significant impact
D - Dramatic impact
(Those business which are vulnerable to technological changes should be managed in a different way than other businesses. As an entrepreneur you should know the impact of technological changes on the proposed business. If your business plan appears viable even after considering that impact, you can proceed with your Business Setup initiative.)

Q.58. Is your product or service marketable beyond boundaries?
A - Yes, anywhere
B – Anywhere except in a few places
C - Only in selected areas
D - Only in a very limited area
(If your product is marketable in a wider geographical area that will reduce the risk.)

Q.59. How many product lines you have?
A - Four or More Product lines
B - Three Product lines
C - Two Product lines
D - Single product line
(If you have more product lines, naturally the risk will be spread over all the product lines. But, there is also a risk in increasing the product lines beyond the optimum level.)

Q.60. Capacity of the business to add more product lines.
A - Any number of products
B - Many products
C - A few more
D - Nothing
(If your business can accommodate more product lines, it is a plus point.)

Q.61. Scope for backward and forward integration.
A - Wider possibility
B - Wide possibility
C - Limited possibility
D - No possibility
(If your business has the scope for backward and forward integration, the possibility of developing and strengthening your position in the industry is higher.)

Q.62. Do you follow a cost-benefit analysis in decision making.
A - Always
B - Most often
C - Sometimes
D – Never
(In business, every resource is coming with a cost. If you are not utilizing a particular resource for a purpose, it can be allocated for many other purposes. So, doing a cost-benefit analysis is very important in arriving at the optimal business decision.)

Q.63.The level of advertisement required for the business.
A – No advertisement required
B – Only normal advertisement required
C – Significant advertisement required
D – Extensive advertisement required   
(If your business requires heavy advertisement, which will definitely bring in some unavoidable costs. Before starting a company in UAE or any other place in the world, you should consider the level of advertisement required for running your business.)

Q.64. Did you prepare a marketing plan for the business to be setup?
A – A well-defined plan in writing
B - Have a plan but nothing in writing
C - Need to develop one
D – I think, a marketing plan is not significant
(Every business is started to offer a product or service in the market. If there is no customer demand for your product or service, there is absolutely no point in starting a Business. So, before proceeding to setup a business in UAE or anywhere else, prepare a detailed marketing plan.)

Q.65. Do you think that the pricing is sensible?
A - Yes, absolutely
B - Reasonable
C - A little bit higher than competitors
D - It is significantly higher than competitors
(There are many examples of a best product failing in the market due to wrong pricing. While starting a business, you should also think about the appropriate price for your product. You should also consider the price elasticity of your market.)

Q.66. Did you already find customers for your product or service?
A - There is a market for the product or service, I already have a handful of clients ready to buy
B - The product or service has a market and I can easily find a market for my product
C - There is a market, I’ve to find customers for my product or service
D – I have to develop a market for the product or service and find customers
(If you already have a few good clients or orders, that is a great boon to start a start-up.)

Q.67. Is it possible to slowly and steadily build the business?
A - Yes, it is possible to establish the proposed business slowly and steadily.
B - Initially it needs to set a minimum size and thereafter can be built slowly.
C – Significant size need to be built initially and thereafter slow and steady growth is possible.
D - The proposed business is not viable for the “slow and steady” model.
(If your business segment ad business plan permits “slow and steady” pattern, which will take a lot of pressure from you as an entrepreneur.)

Q.68. Do you expect major portion of sales from only one industry or segment?
A - Our product or service has potential to draw customers from all industries or segments
B - Our product or service can draw customers from many industry segments
C - Our product or service has potential to draw customers from a few industry segments
D - Our product or service can draw customers from only one industry segment
(If your new business is depending heavily on customers from one industry, any factors affecting that industry will adversely affect you in a more than proportionate way.)

Q.69. Is the success of your business depends on orders from one or only a few clients?
A - No, it expects consistent demand from a wider customer base from different industries
B - We expect many clients from multiple industries
C - We expect reasonable number of clients
D - We expect only a handful of clients
(Too much dependence on orders from a few clients is not a healthy sign. While thinking about business setup, think about spreading your customer base also. Otherwise anything affecting your key clients will directly affect your business also.)

Q.70. Any significant advantages of the proposed business compared to competition?
A - IP Rights, Unique Technology, Cost Advantage
B - Unique Technology, Cost Advantage
C - Cost Advantage
D – Nothing
(If your proposed business has some advantages over and above your competition, which will strengthen your position.)

Q.71. Do you foresee any factor that may affect the proposed business only?
A - No
B - A few minor factors
C - A few major factors
D – Many major and minor factors
(When you are thinking about a new business setup, try to identify factors that affect only your business. Be prepared to face those challenges.)

Q.72. What would be the business’s dependence on advertisement for retaining customers?
A - No dependence
B - Low dependence
C – Medium dependence
D – High dependence
(Advertisement may be required to get new clients. If you do not require advertisement to retain your existing clients, it is a positive sign.)

Q.73. Do the business rely on raw materials and other resources from uncertain sources?
A - No
B - Very limited
C - Limited
D – Yes
(If you are sure about the sources of raw materials and other resources, which will reduce the risk of uncertainty.)

Q.74. Do you see any cost effective raw material alternatives or replacement in near future?
A - Yes
B - Almost sure
C - Probable
D – No
(Cost effective alternatives or substitutes to raw materials will help to control costs.)

Q.75. Easiness to mobilize the required resources.
A – Yes, easily
B - Not easy
C - A little difficult
D - Very Difficult
(If the resources required for the business can be mobilized easily, that is definitely a great advantage.)

Q.76. Is the market of your proposed business crowded with players?
A - There are only a few players in the market
B - There are only limited number of players in the market
C - There are many players in the market
D - The market is overcrowded
(If the market is crowded with many players, be ready to face stiff competition.)

Q.77. Do the supplier and customer credit period in the market gives sufficient cushion?
A – The supplier credit gives sufficient cushion over customer credit period
B - The supplier credit gives limited cushion over customer credit period
C – The customer credit can be just managed with supplier credit
D – It is difficult to manage customer credit with supplier credit
(If there is a significant positive margin between your supplier credit period and your customer credit period, which will be helpful to manage your working capital.)

Q.78. Do you have a clear labour requirement plan?
A - Yes, we have a clear labour requirement plan for all phases during the next four years
B – We have an approximate idea about the labour requirements
C – We have only a basic understanding about the labour requirements
D – We have no idea about the labour requirements
(Successful entrepreneurs plan everything in advance to minimize surprises. If everything is anticipated and planned, you can manage it effectively and efficiently.)

Q.79. Easiness of recruiting staff as per labour requirement plan.
A - Easy for all staff
B - Relatively Easy
C - Not Easy
D – Difficult
(Human resource is the only resource which can create more than proportionate result. If skilled employees can be recruited easily, it will be an advantage for the start-up.)

Q.80. Is there any key personnel required other than owners?
A - No, the owners can manage
B - One or two key personnel required
C - A few key personnel required
D - Many key personnel required
(If too many key personnel are required, it will be difficult to manage the cost and recruitment during the initial phase of the start-up.)

Q.81. Raw material proximity and easiness of procurement
A - Easily available in abundant quantity at lowest price
B - Comparatively Easy
C - Reasonably Easy
D – Difficult
(Proximity of the proposed business to raw material source is a plus point.)

Q.82. Requirement of Machinery and Equipment
A - No machinery required
B - A few machineries are only required
C - A few high-tech machineries required
D - Many high-tech machineries required
(If too many high-tech machines are required for your proposed business, which will increase the initial investment.)

Q.83. Fixed Cost as part of the Total Cost
A - Low
B - Moderate
C - High
D - Very High
(Fixed cost are of fixed in nature, which will incur irrespective of the level of operation. High fixed cost is not a positive sign)

Q.84. Your source of capital for starting the business
A - Own Fund
B - Family Supported Fund
C - External Equity Investors
D - Financial Institutions
(If you are relying on interest bearing capital for starting business, while preparing the financial plan consider the cash outflow required for servicing the debt.)

Q.85. Employee attrition rate in the proposed business segment
A - Very Low
B - Low
C - Normal
D – High
(High employee turnover will increase the labour cost in an indirect way.)

Q.86. The incremental cost that you are estimating over the next five years
A - No incremental cost
B - Limited incremental cost
C - High incremental cost
D – Very high incremental cost
(While planning to setup a Business in Dubai or anywhere else, think about the cost involved in running the business over the next 5 years, whether the cost remain the same?, will the cost increase as the volume of business increase?, will the per unit cost increase or decrease with the volume?)

Q.87. The level of initial cost required to setup the business
A - Low
B - Medium
C - High
D - Very High
(If high initial investment required to start a business, naturally your payback period will also increase.)

Q.88. How long will it take to recover the initial investment?
A- 1 to 2 years
2- 2 to 3 years
3- 3 to 5 years
4- More than 5 years
(If your business can payback the investment within short time, that’s great.)

Q.89. Did you prepare a detailed financial plan and projection?
A- Yes, Detailed Revenue, Cost of Sales / Service, Admin Cost, Net Revenue, Cash Flow projections.
B - Prepared one, not comprehensive (Revenue, Net Profit)
C - An understanding about the financial projections but not in writing
D - No idea about the projected financial position over the next four years
(A cost is associated with every resource. So, prepare a detailed financial plan which tells you the expected revenue, net profit, other income, cash flow, source of fund and utilization of fund, and how you are going to manage the finance and cash flow.)

Q.90. Return on Investment (ROI) of the business is greater than interest on unsecured loans?
A - Significantly Greater than interest of unsecured loan
B- Comfortably Greater than interest of unsecured loan
C - Reasonably Greater than interest of unsecured loan
D- Equal to or less than interest of unsecured loan.
(If your business can offer a good rate of return, which is a positive sign.)

Q.91. Impact of a ten per cent decrease in selling price on profit
A- Decrease in selling price will increase total net profit by more than proportionate increase in sales
B - Decrease in selling price will not affect total net profit because of increase in sales
C - Decrease in selling price will reduce total net profit
D - Decrease in selling price will wipe off total profit
(The sensitivity of net profit to any change in selling price need to be studied before starting any business.)

Q.92. Impact of a ten per cent increase in per unit direct cost on profit
A - Will not affect profit, it can be managed through cost control
B - Less than proportionate decrease is expected in net profit, can be managed through cost control.
C – Proportionate decrease is expected in net profit
D - More than proportionate decrease is expected in net profit
(The impact of an increase in cost on your net profit needs to be studied before starting business setup procedures.)

Q.93. Requirement of any significant capital investment in the next 5 years
A - No capital investment is required
B - Minor investment may be required
C - Significant investment may be required
D - Heavy investment may be required
(If you foresee any capital investment requirement in the next five years, be prepared with a clear solution to raise sufficient capital.)

Q.94. Do Banks and FIs extend Trade Finance and Term Loan support to this business segment?
A - Yes, on preferential basis
B - On selective basis
C - On stringent norms
D – Restricted
(If banks and financial institutions extend trade facilities and term loans to your industry, you will be in a better position to find solutions for future working capital and capital investment.)

Q.95. How promising the industry forecasts for next 5 years?
A - Very Promising
B - Promising
C - Normal
D – Negative
(Positive industry forecast for the next five years is an encouraging factor for starting a new business.)

Q.96. Any chance for policy change in next 3 to 5 years that can negatively affect your business?
A – Absolutely no chance
B - Rare possibility
C – There is a probability
D – There is greater probability
(Stability and consistency in policy is a positive sign to entrepreneurs for business setup. Dubai and UAE consistently follow business friendly policies.)

Q.97. Chances for your industry outperform the growth predictions of the economy?
A - Higher
B - Medium
C - Lower
D – Never
(If the growth forecast for your industry is higher than the overall growth forecast of the economy, which is a very positive sign to setup a new business.)

Q.98. Are you aware of the top ten challenges and opportunities of the industry?
A - Completely aware
B - Reasonable Understanding
C - Aware of a few cases
D - Not aware
(Knowledge about the challenges and opportunities in the proposed business segment will empower you to face the challenges bravely and to cash the opportunities efficiently.)

Q.99. The growth forecast of your industry for the next 5 years
A - Above 10%
B - Above 7 %
C - Above 5%
D- Less than 5%
(A sound growth forecast is always an encouragement to start a new business entity or company.)

Q.100. Macro-economic indicators (GDP, Per Capita Income, Industrial Growth, Employment Generation, Foreign Trade Surplus).
A - Highly favorable
B - Favorable
C - Normal
D – Adverse
(Good micro economic environment always encourage new investments and start-ups in the economy.)

How to find your Business Setup Quotient (BSQ)?

Step 1. Answer all questions with an unbiased mindset. For each question, four answers are given (A, B, C, D). Select one answer from the options given. You may skip those questions which are not applicable for your business.
Step 2. After answering all questions, assign the relevant score as per the score card given below.
Step 3. Calculate Total Score by adding up the score received for all the answers.
Step 4. Calculate Total Maximum Score (400) or Adjusted Total Maximum Score (Total Maximum Score – (Number of Questions skipped x 4 (Four)).
Step 5. Calculate Business Setup Quotient (BSQ) by dividing Total Score by Total Maximum Score or Total Adjusted Maximum Score and multiplying the result by 100. (Total Score / Total Maximum Score or Total Adjusted Maximum Score x 100).
Step 6. Interpret the Business Setup Quotient (BSQ) calculated in step 5 as per the ‘thumb rule’ given below.
Step 7. If you are satisfied with your level of preparedness for business setup, welcome to start your business in Dubai. If you are not satisfied with your level of preparedness to start business in Dubai, put more effort to resolve the shortcomings. Wish you all the very best for your business setup initiative.

Score Card

Each option under a question carries a specified score. You can assign the respective score to your answer as given in this score card. There is no negative score or wrong answer. Each answer carries a score ranging from 0 (zero) to 4 (four).

Q.1. A - 4, B - 3, C - 2, D - 1
Q.2. A - 4, B - 3, C - 1, D - 0
Q.3. A - 4, B - 3, C - 2, D - 0
Q.4. A - 4, B - 3, C - 2, D - 0
Q.5. A - 4, B - 3, C - 2, D - 0
Q.6. A - 4, B - 3, C - 2, D - 0
Q.7. A - 4, B - 3, C - 2, D - 0
Q.8. A - 4, B - 3, C - 2, D - 0
Q.9. A - 4, B - 3, C - 2, D - 0
Q.10. A - 4, B - 3, C - 2, D - 0
Q.11. A - 4, B - 3, C - 2, D - 0 
Q.12. A - 4, B - 3, C - 2, D - 1
Q.13. A - 4, B - 3, C - 2, D - 0 
Q.14. A - 4, B - 3, C - 1, D - 0
Q.15. A - 4, B - 3, C - 2, D - 1
Q.16. A - 4, B - 3, C - 1, D - 0
Q.17. A - 4, B - 3, C - 1, D - 0
Q.18. A - 4, B - 2, C - 1, D - 0
Q.19. A - 4, B - 3, C - 1, D - 0 
Q.20. A - 4, B - 3, C - 1, D - 0 
Q.21. A - 4, B - 3, C - 1, D - 0 
Q.22. A - 4, B - 3, C - 2, D - 0
Q.23. A - 4, B - 3, C - 2, D - 0
Q.24. A - 4, B - 3, C - 2, D - 1
Q.25. A - 4, B - 3, C - 1, D - 0
Q.26. A - 4, B - 3, C - 2, D - 1 
Q.27. A - 4, B - 2, C - 1, D - 0 
Q.28. A - 4, B - 3, C - 1, D - 0
Q.29. A - 4, B - 3, C - 2, D - 0
Q.30. A - 4, B - 3, C - 2, D - 0 
Q.31. A - 4, B - 3, C - 2, D - 1
Q.32. A - 4, B - 3, C - 1, D - 0 
Q.33. A - 4, B - 3, C - 1, D - 0
Q.34. A - 4, B - 3, C - 2, D - 0
Q.35. A - 4, B - 3, C - 2, D - 0
Q.36. A - 4, B - 3, C - 2, D - 0
Q.37. A - 4, B - 3, C - 2, D - 1 
Q.38. A - 4, B - 3, C - 2, D - 1
Q.39. A - 4, B - 3, C - 1, D - 0 
Q.40. A - 4, B - 3, C - 2, D - 1 
Q.41. A - 4, B - 3, C - 1, D - 0 
Q.42. A - 4, B - 2, C - 1, D - 0
Q.43. A - 4, B - 2, C - 1, D - 0 
Q.44. A - 4, B - 2, C - 1, D - 0
Q.45. A - 4, B - 3, C - 2, D - 0
Q.46. A - 4, B - 3, C - 1, D - 0
Q.47. A - 4, B - 3, C - 1, D - 0
Q.48. A - 4, B - 3, C - 2, D - 1 
Q.49. A - 4, B - 2, C - 1, D - 0
Q.50. A - 4, B - 3, C - 1, D - 0
Q.51. A - 4, B - 3, C - 1, D - 0 
Q.52. A - 4, B - 3, C - 1, D - 0 
Q.53. A - 4, B - 2, C - 1, D - 0
Q.54. A - 4, B - 3, C - 2, D - 0
Q.55. A - 4, B - 3, C - 2, D - 1 
Q.56. A - 4, B - 3, C - 1, D - 0
Q.57. A - 4, B - 3, C - 1, D - 0
Q.58. A - 4, B - 3, C - 1, D - 0
Q.59. A - 4, B - 3, C - 1, D - 0 
Q.60. A - 4, B - 3, C - 2, D - 0
Q.61. A - 4, B - 3, C - 1, D - 0
Q.62. A - 4, B - 3, C - 1, D - 0 
Q.63. A - 4, B - 3, C - 1, D - 0
Q.64. A - 4, B - 2, C - 1, D - 0
Q.65. A - 4, B - 2, C - 1, D - 0
Q.66. A - 4, B - 3, C - 2, D - 0
Q.67. A - 4, B - 2, C - 1, D - 0
Q.68. A - 4, B - 3, C - 2, D - 1
Q.69. A - 4, B - 3, C - 2, D - 1
Q.70. A - 4, B - 3, C - 2, D - 0
Q.71. A - 4, B - 3, C - 1, D - 0
Q.72. A - 4, B - 3, C - 2, D - 1
Q.73. A - 4, B - 3, C - 2, D - 1
Q.74. A - 4, B - 3, C - 2, D - 1 
Q.75. A - 4, B - 3, C - 2, D - 0 
Q.76. A - 4, B - 3, C - 2, D - 0 
Q.77. A - 4, B - 3, C - 2, D - 0
Q.78. A - 4, B - 2, C - 1, D - 0 
Q.79. A - 4, B - 3, C - 1, D - 0
Q.80. A - 4, B - 3, C - 2, D - 1
Q.81. A - 4, B - 3, C - 2, D - 0 
Q.82. A - 4, B - 3, C - 1, D - 0
Q.83. A - 4, B - 3, C - 1, D - 0
Q.84. A - 4, B - 3, C - 2, D - 1
Q.85. A - 4, B - 3, C - 2, D - 0
Q.86. A - 4, B - 3, C - 1, D - 0
Q.87. A - 4, B - 3, C - 1, D - 0
Q.88. A - 4, B - 3, C - 2, D - 1 
Q.89. A - 4, B - 2, C - 1, D - 0
Q.90. A - 4, B - 3, C - 2, D - 1
Q.91. A - 4, B - 3, C - 1, D - 0
Q.92. A - 4, B - 2, C - 1, D - 0
Q.93. A - 4, B - 3, C - 2, D - 0
Q.94. A - 4, B - 2, C - 1, D - 0
Q.95. A - 4, B - 3, C - 1, D - 0
Q.96. A - 4, B - 3, C - 1, D - 0
Q.97. A - 4, B - 2, C - 1, D - 0
Q.98. A - 4, B - 2, C - 1, D - 0
Q.99. A - 4, B - 3, C - 2, D - 1
Q.100. A - 4, B - 3, C - 2, D -0 

How to interpret Business Setup Quotient (BSQ)

Once the score is arrived (BSQ), find the % of your BSQ on the maximum score (Your BSQ /400 (or adjusted maximum score)*100). If the BSQ per cent is:

0 to 24 – You are not ready for business setup. Reinvent yourself
25-49 – you have some factors inevitable for a successful business man. See which are the key factors missing in you.
50 to 74 – You are almost ready to become an entrepreneur. But more preparation and thoughts may be worth
75 to 100 – You are prepared to start business. The higher your rank, the better your preparation.


“Business Setup Quotient (BSQ)” is only a tool to help an aspiring entrepreneur to self-assess the preparedness for starting a new business.
It only intends to bring to the attention of the aspiring entrepreneurs the relevant factors which should be considered before starting a business.
The questions given in the test module is developed only on the basis of my experience. It is not developed on the basis of any scientific theories or concept.
The score assigned to each answer is also given on the basis of the presumed impact on the business, based on my experience.
The thumb rule given to interpret the Business Setup Quotient (BSQ) is only an indication about your preparedness to start a business. It is only my personal opinion and not based on any scientific techniques of analysis.
Visitors are not required to take the test and rely on the test result and thumb rule. They are free to do so at their own discretion.  
The questions given in the test module are not exhaustive. It may have missed many valid questions and factors relevant to entrepreneurship and success of a business.
Respondents are advised not to take your start-up decision or postpone it based on this test result alone. You may seek the advice of an expert before taking any action. We are not responsible for any decision taken by you on your discretion.

The concept of “Business Setup Quotient (BSQ)” is developed by Mr. Baiju Masoodu, who is a business setup consultant based in Dubai. He advise clients on free zone & offshore company formation. You can contact him on: Mob. +971 50 214 1476 E-mail.

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