eCommerce sector in UAE is on a growth pace since several years. UAE is the best place to start an eCommerce Business. The technology infrastructure and a wide audience base is fueling the growth of an eCommerce Business in UAE.
There is enormous investment opportunities in the eCommerce sector in the UAE. There is whole lot of support system requirements for starting an eCommerce Company in UAE. The support system will help scale up the eCommerce business successfully.
eCommerce Business in UAE – Requirements
There is a requirement for a large real estate space for the warehouse, office space, packaging unit, delivery fleet, etc. UAE is a perfect choice for eCommerce company and it has a variety of warehouses available for the business.
Additionally, the high internet penetration and smartphone usage are making UAE the ideal destination for eCommerce businesses. To promote eCommerce businesses in Dubai, Dubai Airport Free Zone has launched a dedicated Free Trade Zone – Dubai Commercity.
There is a wide range of eCommerce service providers in the UAE who are offering services in food delivery, electronics, fashion, Beauty products, online services, etc. The scope of eCommerce Companies in UAE are expanding to new levels every year.
Start an eCommerce Business in UAE
UAE has a robust business ecosystem for eCommerce Companies to thrive. To power the growth of eCommerce Business in UAE, there must be a certain infrastructure plan in place.
The Free Trade Zones and the Government of Dubai are actively drafting policies and initiating infrastructural developments to support the growth of eCommerce companies in the region.
There is an evident shift from the traditional shopping environment to online shopping mainly due to the shopper’s convenience, availability of wide choice, and discounts.The shift has made more entrepreneurs offer online selling and platforms that facilitate online shopping and secure payments online.
Here are the steps for opening an eCommerce Company in UAE:
Starting an eCommerce Company in UAE involves a few steps to follow. There multiple ways to start an ecommerce Company in UAE. The process is mostly straight forward and there is no additional approvals from the Government Authorities.
However, for specific items such food packaging and online sales, there is warehouse inspection prior to the license issuance from the municipality. Our team will guide you with the right steps.
- Choose the right legal structure for your eCommerce business in UAE – Free Zone Company or a Mainland LLC Company
- Select the ideal business location – Specific Free Zone, or any location in the Mainland
- Company Trade Name Reservation – Investor must provide 3 names in priority and the Licensing Authority will approve one for the company after review
- Submit the eCommerce license application to the licensing authority along with the investors passport copy & photograph
- Obtain the initial approval certificate from the respective authority.
- Prepare the Memorandum of Association (MOA) with the respective licensing Authority. Aurion will assist in preparing the document and getting the approval
- The tenancy contract for the office space must be ready. (Investors must take separate warehouse space for storing the goods for delivery, packaging, etc.). Aurion will assist in preparing tenancy contract for office and warehouse for your ecommerce company.
- For ecommerce companies indulging in import/export of goods to international markets, having the company registered with Ports & Customs Department is mandatory.
- The investors can now start operating their ecommerce company legally in UAE. They can also apply for a UAE Residence Visa and Corporate Bank Account for facilitating trade.
Cost of starting an eCommerce Company in UAE
The cost of an eCommerce License in UAE for a 1 Visa Quota starts from around AED 11,743. However, there are many cost-headers the investors will incur with the eCommerce License in UAE.
Few Additional Costs for setting up an eCommerce company in UAE by the investors are the following:
- The Investor and Employee Visa cost (Depending on the number of staff required at the start)
- Medical and Emirates ID Costs for investors and employees
- Medical Insurance Fee of Investors & employees
- Company Establishment Card Cost. Depending on the specific Free Zone, the fee varies
- Company Stamp – To be used in all Government & customer communication like invoices, contracts, and more
- Company name changes (if any)
- Other Government fees for special requests, etc.
Aurion provides you with the most cost-effective eCommerce license package in UAE from top Free Trade Zones.
eCommerce Business in UAE – Support System
Here are a few support systems required for an eCommerce Company in UAE. For an eCommerce Company in Dubai to sustain and achieve business productivity of desired levels, there has to be a certain support system in place that the company has to implement.
1. Suppliers and Distributors
Identifying the right suppliers and distributors for the eCommerce business in UAE is crucial. The suppliers and the distributors form the backend support system and are a crucial part of your business success.
2. Improved Logistics
The logistics requirement in e-commerce is undeniable. To start an eCommerce Company in UAE, they must require a well-supported logistics network to fulfill the order requirements.
A warehouse for storage and facilitating logistics is crucial for maintaining the required stock of the items. The scope of Logistics is vast and tasks such as packaging, preparing the document of delivery, coordinating delivery service, returns, etc., fall under the purview of Logistics support services.
3. Warehousing and Storage
The warehousing and storage facilities are a major requirement for an eCommerce company in UAE. It ensures the proper management of the shipment. Inventory management and communication with the eCommerce business drive smooth supply chain operations in UAE.
4. Online Payments Management
Retailers are tapping into the eCommerce world and selling through multiple digital platforms and mobile eCommerce platforms. The online payment system is backing up the eCommerce websites facilitating quick payments in the digitally first world.
A robust payment gateway integrated into a user-friendly checkout page is a win for starting an eCommerce Company in UAE. As it will enhance the customer trust and reliability of your brand.
5. Increased Security and Database Management
To Start an eCommerce Company in UAE securing the IT System of the eCommerce Company is essential. They must have a secured website and backend system in place to detect fraud and also any external hacks.
Also, there is a vast amount of customer information that must be always kept safe and secured. Thereby, boosting the brand image of the new eCommerce Platform.
6. Robust Technology Platform
The integrated technology platform for eCommerce must be capable of monitoring, managing, and executing all the requirements of the customer effectively. The seamless flow and user-friendly nature of the software is a must have for a successful eCommerce business in UAE.
The system must be capable enough to manage daily eCommerce transactions precisely and enhance customer satisfaction
7. Customer Experience
The entire experience of online shopping through the website must be seamless and deliver a positive customer experience.
The eCommerce platform must be tested and secured. There must not be any downtime or error message while the customer is shopping or while making a transaction. This way it will provide a seamless shopping experience for the shopper via your eCommerce website.
To know more about eCommerce business opportunities in the UAE and selling on Amazon or noon read our blogs!
