Setting up a
Consulting business.
Management consulting in Saudi has been the fastest-growing professional service segment since 2017. Vision 2030 created sustained demand for transformation consulting (McKinsey, BCG, Bain all expanded materially). Foreign consultancies can own 100%, set up as professional license, and operate with low capital intensity.
What's specific to Consulting.
License codes, capital, regulators, and quirks that competitors gloss over.
- Activity codes: 7022 (management consulting), 7110 (engineering consulting — needs engineering body license), 6920 (accounting/tax — needs SOCPA license)
- Best entity: professional license (lighter than full LLC for service firms)
- Capital: SAR 100K minimum, but operationally very low overhead
- Saudization: standard — office staff 50%+ Saudis
- Tax: 20% corporate tax (foreign-owned) + 5% withholding on payments to non-residents
- Govt advisory: requires panel pre-qualification (typically 6-12 months)
- Talent: senior consultants are scarce, retention requires competitive comp
What we see go wrong.
- ✗ Setting up under generic 'consulting' code when sector-specific code (engineering, financial advisory) is required for that work
- ✗ Underpricing govt advisory work — Big 4 set high rate cards, smaller firms must justify discount
- ✗ Not structuring partner equity correctly — Saudi tax is high; structuring matters
- ✗ Skipping SOCPA registration for accounting/tax practice — operating illegally
- ✗ Hiring all-foreign team — Saudization quota hits when scaling beyond 10 staff
Common questions.
Professional license is faster, cheaper, lighter compliance. Best if you only sell services. LLC is more flexible (can sell products too, easier ownership transfer). Most consulting firms start with professional, upgrade if scaling.
Yes — but most large govt advisory work goes to pre-qualified panels (typically Big 4 + select boutiques). Pre-qualification takes 6-12 months. Smaller firms partner with panel members for first projects.
SAR 100K minimum (regulatory floor). Practical operational capital: SAR 200-500K to cover 6 months of expenses + initial marketing. Consulting is low capex but talent costs are high.