E-commerce is thriving in Dubai, with online shopping becoming more popular than ever. The regional digital economy continues to grow, reflecting a strong upward trend.
The value of e-commerce sales in the United Arab Emirates has seen significant growth from 2015 to 2022.
(in billion U.S. dollars)
Online Business in Dubai
Dubai’s online business landscape is thriving, with around a hundred well-known e-commerce shops catering to its 3.6 million residents. The majority of the population consists of mid-aged working individuals who are well-equipped with mobile phones, laptops, and a good disposable income.
People increasingly prefer online shopping due to its convenience. Online stores are accessible 24/7, saving valuable travel time and offering the ability to find the best deals from the comfort of one’s home.
This surge in demand for e-commerce services is driving the growth of e-commerce licenses in Dubai, with numerous opportunities available for setting up an online business.
What is E-Commerce?
E-commerce, or e-business, refers to the process of making money online by selling goods or services over the internet. It encompasses a wide range of businesses, from online grocery stores to private jet bookings.
Whether you’re a freelancer or a multinational corporation, an online presence is essential. Today, virtually any business needs to have an e-commerce component to remain competitive.
Online Trading in the UAE
The significance of e-commerce in the UAE has never been higher, and while the market continues to grow, it is far from saturated. Currently, a few major players dominate the market:
www.amazon.ae
www.noon.com
www.namshi.com
www.carrefouruae.com
www.kibsons.com
www.dubizzle.com
www.shein.com
www.ubuy.ae
www.mumzworld.com
Leading online shopping platforms in the United Arab Emirates in 2020 by usage
Starting an Online Business in Dubai: A Comprehensive Guide
Dubai is home to a thriving e-commerce ecosystem, with a variety of options available for those looking to sell products or services online. The city’s growing demand for online shopping offers businesses numerous opportunities to succeed in the digital market.
If you want to sell your products or services online in the UAE, you have three primary options:
Sell through a Marketplace: This is the easiest way to start. Marketplaces like Amazon and Noon provide guaranteed visibility for your products without significant advertising costs. However, you will need to pay a commission to the marketplace and ensure timely delivery.
Build Your Own Website: Selling through your own website eliminates marketplace commissions, but it requires higher investment in advertising and logistics management.
Sell on Social Media: Target specific audiences by promoting your products on social media platforms.
The most effective strategy for online selling in the UAE often involves using a combination of these methods. Most successful businesses utilize multiple online channels to reach a wider audience.
Setting up an online business in Dubai requires obtaining the right license, depending on the type of e-commerce you plan to conduct. Here are the most common licenses:
Portal License: This license is for businesses acting as intermediaries between buyers and sellers, like Amazon. It’s commonly offered by most UAE free zones, making it easy to obtain.
E-Commerce License: For businesses selling their own products through their own website, this license is a popular choice. This includes both small-scale websites and large retailers like Mumzworld.
Commercial or Service License: Even if your business doesn’t directly involve e-commerce, you can still sell products or services online under this license. For instance, businesses offering online consultations, education, or other services can use this license.
E-Trader License: The most cost-effective option for starting an e-commerce business in Dubai. The license costs AED 1,070 and is issued by the Dubai Department of Economic Development (DED).
Freelance License: With freelancing now legalized in the UAE, freelancers can obtain a license to advertise and offer their services online in Dubai and globally. This is ideal for professionals like designers, tutors, and IT consultants.
Many businesses in Dubai sell products through established online marketplaces. Here are some popular platforms where you can start your e-business:
Noon.com
Amazon.ae
Mumzworld.com
Firstcry.ae
Ubuy.ae
DubaiStore.com
TheLuxuryCloset.com
SharafDG.com
Cobone.com
To launch your own e-commerce business, you’ll need to set up an e-commerce website. The easiest way to do this is by using platforms like:
Shopify
Code-Brew
Ecwid
These platforms simplify the website setup process, allowing you to focus on your business.
Your e-commerce website should include a secure payment gateway to process online transactions. Some popular online payment providers in the UAE include:
Stripe
PayTabs
Telr
HyperPay
Foloosi
You can also accept payments through PayPal or the cash-on-delivery method, which is particularly useful for startups. Payment providers typically charge a commission of 2-3% per transaction, depending on the type of goods and sales volume.
An essential component of any online business is an efficient delivery service. Many e-commerce businesses in Dubai partner with third-party logistics companies for both local and international shipping. Some trusted delivery providers include:
Zajel
Aramex
These companies offer affordable and reliable delivery services, with user-friendly apps to manage and track shipments.
In Dubai, obtaining an e-commerce license is one of the most popular ways to start an online business. However, even if your business doesn’t directly fall under the e-commerce category, you can still sell online under other types of business licenses.
Why Opt for an E-Commerce License?
While it’s not mandatory to have an e-commerce license to sell online in the UAE, certain partners or vendors may require it. For example, marketplaces like Amazon may ask for this license before allowing you to list your products.
If you’re looking for the most affordable e-commerce license in Dubai, the e-trader license is the best option. It costs just AED 1,070 and is a great choice for individuals or small businesses. However, this license has specific requirements that must be met.
For those looking for an e-commerce license in one of the free zones, the cost typically starts from AED 15,000, which includes basic services but may not cover residency visas or office space.
If you plan to run your e-commerce business in Abu Dhabi, you’ll need to register with either the Department of Economic Development of Abu Dhabi (ADDED) or a free zone like KIZAD.
ADDED has some restrictions, particularly for non-UAE nationals, so partnering with a UAE national may be necessary if you opt for this route. For full ownership, a free zone license is the best option.
Do I Need an E-Commerce License to Sell Goods Online in the UAE?
Yes, to sell goods online in the UAE, you are required to obtain a trade license. This can be acquired through a free zone or the Department of Economic Development (DED).
How Much Does an E-Commerce License in Dubai Cost?
E-commerce licenses in Dubai start at AED 1,070 (approximately USD 295) for the E-trader license. However, this license is only available to UAE residents and GCC citizens. For non-residents, alternative licensing options start from AED 11,500 (about USD 3,150).
How to Get an E-Commerce License in Dubai?
Follow these steps to obtain your e-commerce license in Dubai:
Decide the Type of Products or Services: Determine whether you will be selling goods or services online.
Search for Storage and Delivery Solutions: If selling goods, find reliable storage and logistics services.
Register Your License: Apply for your license through a free zone or the DED.
Open a Corporate Bank Account: Set up a bank account for your business.
Set Up an Online Payment Gateway: Partner with a payment provider to handle transactions.
Promote Your Business: Once licensed, you can start marketing and selling your products.
Can I Sell Bakery Products Made at Home Online?
Yes, you can sell homemade bakery products online in the UAE. However, you will need a trade license and must ensure that your products comply with local hygiene standards. This may involve obtaining certifications and proving that you or your staff do not have any contagious diseases.
Can I Sell Goods Online Without a License in the UAE?
No, it is illegal to sell goods or conduct any business in the UAE without a valid business license. Penalties for operating without a license can be as high as AED 500,000 (approximately USD 137,000). Selling through platforms like social media is also considered conducting business and thus requires a license.
Do I Need an E-Commerce Trade License to Sell on Amazon?
According to Amazon’s regulations, an individual can sell on Amazon without a trade license as long as they are a physical person. However, this may vary depending on your location and the type of business you plan to run. It is generally recommended to have a license for full compliance.
The brand name Visa Kings Global is used under licence by Visa Success Limited. Visa Success Limited is not a firm of solicitors and is not regulated by the Solicitors Regulation Authority. Visa Success Limited does not give financial, legal or tax advice.
Information affecting all users of this website can be found on our Legal Notices page which you are deemed to have read and accepted.
