How to set up your online business in the UAE – Five important aspects to consider before starting your e-commerce business in the country
Whether you’re buying for personal consumption or business through the internet, online shopping is now a big part of our everyday lives. This fact is going to evolve even more so in the coming years with the upsurge of e-commerce businesses that are promptly capitalising on the soaring number of online shoppers today.
The United Arab Emirates (UAE)–having the most advanced e-commerce market in the whole MENA region–is set to hit a staggering US$16 billion (AED 59 billion) e-commerce transactions in 2019 according to the joint study published by Dubai Economy and VISA entitled ‘UAE eCommerce Landscape’. Average annual growth of 23 per cent was also projected between 2018 and 2022.
Several factors have contributed to the UAE’s global e-commerce positioning, including the rise of startups and tech-savvy consumers in the country. More importantly, the UAE government plays a vital role in reinforcing smart transactions between businesses and consumers today by expanding cashless payment options for various types of purchases and government services in the country.
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With such positive growth forecasts on the e-commerce economy, it’s high time to start your online business now more than ever. But to operate legally, you must obtain a trade license from a Free Zone or Mainland authority before proceeding. Here’s how to set up your e-commerce business in the UAE:
Choose the right jurisdiction and get a trade license
Choosing between a Free Zone and the Mainland authority will entirely depend on the nature of your online business. A mainland license gives you the freedom to trade or sell your products and services directly to the local market while a free zone license will require you to work with a local distributor. In this case, consider the factors from which your business can benefit more in terms of market reach and scalability.
Develop, build, and launch your website
The most important aspect of your e-commerce business is your website. It may take a while to build and test your website, but it’s worth spending time and effort as your it will serve as your stage to showcase your products or services, a platform to gain and interact with customers, and your primary tool for making profits. So to build an income-generating website you have to keep in check its user-friendliness, web maintenance, secure hosting, and mobile usability among other things.
Include online payment gateways
As an e-commerce business, it is but necessary to present different payment options to your consumers. Integrated secure payment gateways that include credit card payments and pre-paid card systems are the most convenient ways to do this. Another payment option is cash-on-delivery (COD), which comes in very handy for various situations.
Secure logistics, storage, and delivery
If your online business involves physical products to sell or trade, it is mandatory to have proper warehousing to store your goods. This factor is equally important when deciding the jurisdiction to set up your company. Once you secure a warehouse and office space, the next thing on your list is to establish a reliable logistics system to ensure efficient delivery of your products to your consumers. You can opt for a third-party logistics or build your own.
Market your products or services
Once your business is ready to roll out in the market and after having all things in place, everything still boils down to your marketing strategy. The best way to do this is by targeting the right market for your products and services. Consequently, create an effective marketing plan that aligns your products and services to the needs and wants of your target consumers.
These are just some of the steps you need to consider before starting an online business in the UAE. Depending on the nature of your business, you may or may not need more steps than those as mentioned above.
Lastly, doing it right with the help of experts will ensure the successful establishment of your e-commerce venture. So, it is advisable to seek professional guidance from a trusted business setup firm. The company formation specialists will provide expert advice for your licensing options in the UAE as well as guide you through the entire process.
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