Online retail is booming and the Ecommerce in UAE is the most advanced market in the Middle East and North Africa. A study between the Dubai Economy and Visa estimated e-commerce transactions in the country to hit $16 billion in 2019 and grow 23% on average annually to 2022. With consumers increasingly relying on online shopping, it is estimated that 95% of purchases will be made online by 2040. E-commerce is opening the doors of opportunity to countless entrepreneurs.

What impact Covid-19 brought to e-commerce?

We have witnessed, due to various lockdown restrictions across the UAE, including the temporary closure of shopping malls and all shops selling non-essential items, shoppers were turning to websites following Ecommerce in UAE! They can shop from the comfort and safety of their homes and have their chosen products delivered to their door at a convenient time for them. What could be easier? Its hassle free and shoppers stay safe.

The supermarkets were experiencing a huge surge in online grocery orders. Most people were stuck in their homes, they had more time to browse the internet and shop at leisure. There has never been a better opportunity to reach out to a highly engaged online audience!

How do I start or convert my existing business to Ecommerce in UAE?

Choose the product/service you want to sell. If you make the product this step is easy. If not, you will need to find a secure supplier so you can meet your customer’s demands both now and in the future.  Dealing with suppliers, you will also need to consider upfront payments and delivery times to bring your products to market.

Market research – where do your products fit in the market?  Is there a demand? If they are innovative, will you need to educate people? Will you position them as high end and premium priced or as a low-cost product where selling volume is key? Will they need to be adapted to the local market in any way?

• Where will you store your products?
• How will your products be distributed to your customers?
• Who will build your e-commerce website? Will you outsource or will you build it yourself using a platform like Wix?
• How will you market your e-commerce business? E.g. setting up social media accounts, organizing photography, PR, trade samples, focus groups, advertising, testimonials etc…

Key benefits of Ecommerce in UAE

Entrepreneurs, starting an online business in one of the free zones of Dubai, UAE gets some pleasing benefits:

–  There are no taxes and fees (except for VAT of 5%)

–  There are no restrictions on the withdrawal of capital and no currency restrictions;

–  The possibility of 100% ownership of a foreign company in one of the free zones;

–  Operating expenses are lower than in other jurisdictions.

–  No import/export duties with e-commerce license.

–  The possibility of obtaining a resident visa of the UAE for three years with the possibility of renewal.

A Checklist for E-commerce Entrepreneurs in Dubai, UAE

However, procedures for the business setup in Dubai may appear to be complex due to the different regulations in the mainland and the free zones. E-commerce entrepreneurs need to follow certain guidelines while establishing a company in Dubai. The following is a checklist for the investors who are planning to set their base in Dubai:

i) Choose the Right Jurisdiction and Obtain a Trade License

The e-commerce entrepreneurs planning to start their business need to make a strategic decision about the jurisdiction in which they should set up their company. The investors have to make a choice between the free zone and mainland company formation depending on their business requirements. With a mainland e-commerce license, entrepreneurs can trade their products directly to the local market. If the investors decide to form an e-commerce company in the free zones, then they have to reach an agreement with a supplier to sell the products. The mainland company formation requires a physical office where the free zones offer many viable facilities including the flexi desks for e-commerce operators. The e-commerce companies can consult the best business setup consultants in Dubai, UAE to decide on the jurisdiction as they will provide expert advice on both mainland and free zone company formation.

ii) Develop and Launch A Website

For any e-commerce company to kick off the foremost thing is to develop and launch a website. The website is the platform through which the companies can facilitate the trading of goods. The commerce entrepreneurs need to invest in website development to build a robust interface to showcase the products and interact with the customers.

iii) Register a Domain Name

The e-commerce companies need to have a strong domain name which would be the address of the company’s website. The domain name will also be the company’s name in most cases. The e-commerce entrepreneurs need to register the domain name for the company’s smooth take off.

iv) Register Trademarks

Protection of intellectual property rights is a crucial aspect of the business that most of the e-commerce startups overlook at the initial stage. The e-commerce companies need to register their trademarks right from the start to secure their brand value. Building a brand image is crucial for every company and registering the trademarks with the UAE Trademark Office is the first step in this process. The companies can trademark their brand name, logos and designs to build a strong brand image in the minds of the consumers.

v) Include Online Payment Gateways

For an e-commerce business, it is crucial for integrating different payment methods for its consumers. The payment gateway should be safe and secure and should include credit card payments. Most of the e-commerce platforms also include the cash-on-delivery (COD) system which would be useful in different situations.

vi) Warehouse, Office Infrastructure

The e-commerce companies that deal with consumer goods to trade need to have proper warehouses for the storage of goods. Such businesses need to secure a warehouse and also an efficient logistics service. If the jurisdiction is mainland, the companies also need to setup an office space. For mainland business setup procedure, the e-commerce companies would require the assistance of reputed business setup consultants who would make the company formation procedure smooth and quicker