7 Steps to Consider Before Starting an E-Commerce Business Setup in UAE

Online shopping has now become an inevitable part of our lives. Long back, it was considered as a matter of convenience and luxury, but now it has turned out to be a necessity with the recent COVID-19 situation that shook the entire world. According to the joint study published by Dubai Economy and VISA entitled, ‘UAE e-commerce Landscape, the average annual growth of the e-commerce market in the UAE is expected to rise by 23 percent between 2018 to 2022. With this rapidly emerging online retail trend, many entrepreneurs are planning to establish their e-commerce business in the UAE. If you are one among them, here are 7 steps worth considering:

1. Choose the right jurisdiction for obtaining license

Business owners can select their preferred legal entities, free zone or mainland depending on a business type and area of interest. A mainland license offers you the freedom to trade or sell your products and services directly to the local market whereas a free zone license requires you to work with a local distributor. A free zone license has several advantages such as 0% income tax, 100% repatriation of business profits, 0% corporate tax, 100% complete business ownership and negligible custom duties.

2. Select a trade name

The second step is to select a unique business name which no one else is using. In order to reserve a trade name, you need to obtain the name approval certificate from the DED (Department of Economic Development).

Necessary documents required

Passport/visa copies of shareholders

Copy of sponsors passport/ Emirates ID

Local service agreement/ MOA (Memorandum of Association)

NOC from the relevant authority

3. Obtain the license

Obtain the essential license from DED (Department of Economic Development).

4. Develop and launch your website

A website is the most important part of your e-commerce business, it is the platform for showcasing your products and interacting with customers. Make sure that your website has secure hosting and a user-friendly interface.

5. Payment Gateway Integration

It is essential to offer different payment options for customers and when you shortlist these options, always keep two things in mind: stability of the payment gateway and transaction success rate.

6. Safe logistics, storage, and delivery

It is necessary to have a secure warehouse to store your physical goods. After securing a warehouse, you need to establish a reliable logistics system to ensure a safe delivery of products to customers. You can either opt for a third-party logistics or build your own.

7. Marketing

Soon after your business is all set to be launched into the market, the next step is to come up with a marketing strategy for reaching your target customers. This marketing strategy should also align with the interests and needs of consumers.

Starting an e-commerce business setup in UAE requires careful planning, but with the right approach and understanding of the local market, you can set yourself up for success in this rapidly growing sector. It’s recommended to seek professional advice and guidance from business consultants or legal experts to navigate the complexities of setting up an e-commerce business in the UAE.

Corpin Consultants have helped several entrepreneurs and companies to set up their e-commerce business in the UAE. We can assist you in selecting the right jurisdiction, easily open bank accounts and ensure a hassle-free licensing procedure. Contact us to book a free consultation with our experts.