The UAE is home to many types of business sectors and industries, which have been successful in this country. Among those sectors, the e-commerce business in the UAE has been growing stronger during the last few years. Therefore, many new investors from everywhere have started investing in their e-commerce businesses.

In this article, you will learn everything you need to know about the e-commerce business in the UAE. For example, you will discover how this sector has been growing over time and what elements made it a successful business. Also, we will give you some reasons why you should set up an e-commerce business in this country. Let’s observe:

1. What is the e-commerce business about?
2. What made this business sector grow in the UAE?
3. Importance of the e-commerce business sector in the UAE.
4. Why should investors like you set up an e-commerce business in this country?
5. What is the e-commerce license and how can you obtain it?
6. What do you need to consider before starting an e-commerce business?
7. How can you set up an e-commerce business in the UAE?
8. How can Connectfz help you set up your e-commerce business in this country?

1. What is the e-commerce business about?

As the technological fields get more advanced over the years, the e-commerce business in the UAE gets more popular. E-commerce is mostly related to the retail business, which is about selling goods to consumers in exchange for money. However, there is already a new concept that involves e-commerce with retail businesses directly; this concept is known as eTail.

Firstly, it is important to have a clear understanding of the basic concept of the e-commerce business. E-commerce is a type of digital market in which investors can sell physical products or goods. On the other hand, consumers can access these goods and purchase them using a computer or mobile device with an Internet connection.

However, e-commerce does not include all products. For example, it does not include digitally distributed services (eServices), streams, or digital media download. Also, it doesn’t include digitally distributed goods in B2B (business-to-business) markets. And lastly, it does not include digital purchase or resale of repaired, used, or defective goods (re-Commerce).

During the last decade, the e-commerce business in the UAE has been exponentially boosted, especially during the last two years. Therefore, many local and foreign investors and entrepreneurs have decided to start their e-commerce businesses in this country. Now, let’s take a look at some information regarding the e-commerce business growth in the UAE.

Here you can learn about the growth of the retail business in the UAE during the COVID-19 pandemic.

2. What made this business sector grow in the UAE?

An element that turned out to be a great impact on the global economy was the COVID-19 virus. Due to the quarantine it caused, people had to make use of technology to keep social distance. For example, they had to buy food, medicines, and other necessities through the digital platforms of different stores.

Another consequence of the COVID-19 pandemic was the lockdown restrictions. This consequence also includes the closure of many shopping malls and physical stores that sell non-essential products. Subsequently, consumers had to resort to online shops, which facilitated many trading activities like this. And since then, the e-commerce business started to bloom even more.

Shopping online became a necessity during the pandemic situation, allowing e-commerce investors to boost their businesses. And as time passes, new technologies and online platforms gain more prominence. Therefore, the e-commerce business in the UAE became one of the most profitable businesses in the current times.

Here you can learn about the latest update of the labor regulations applicable in free zones in the UAE.

3. Importance of the e-commerce business sector in the UAE.

As we previously mentioned, the current COVID-19 global emergency forced the most of population to work/study from home. Since then, the e-commerce business in the UAE has exponentially bloomed. Therefore, it has also become a vital business in the country for everyone.

However, the pandemic is not the only reason why this business is very important currently. Even before the virus, this was already the fastest growing market in the UAE. And as time passes, it will keep growing as one of the most important businesses in the country, along with the oil industry and the textile industry.

Therefore, this is the perfect time for all new investors to consider setting up this type of business in the UAE. Now, let’s see what the benefits that they can obtain here are.

4. Why should investors like you set up an e-commerce business in this country?

In this country, all investors and entrepreneurs can obtain several benefits to allow their businesses to thrive efficiently. These advantages are valid for all kinds of business, but they can vary according to the selected jurisdiction. An e-commerce business in the UAE can obtain many benefits in both mainland and free zone.

However, here we will focus on the benefits that all free zones in the UAE offer to e-commerce investors:

• Setting up in a free zone is the most cost-effective option for e-commerce investors.
• It allows investors to have full ownership of their businesses.
• It’s not a requirement to have a local sponsor.
• It offers full exemption from customs duty of imported goods.
• Full exemption from income and corporate tax.
• 100 percent repatriation of profits and capital.
• All free zones in the UAE offer world-class infrastructure and facilities, especially Dubai free zones.
• Investors can receive several incentives and support services.
• You can apply for a license at a very low cost, but it’ll depend on the location. For instance, the e-commerce license Dubai price starts from AED 8,500 approximately.

Besides, another reason why you should set up an e-commerce company is that this business is more profitable nowadays.

Here you can learn about the renewable licenses in Abu Dhabi that have validity for 3 years.

5. What is the e-commerce license and how can you obtain it?

The process to obtain an e-commerce license is the same in every location. However, the pertinent authorities will vary. For instance, if you set up in a free zone, the free zone authorities will issue your license. However, if you set up in the mainland, the Department of Economic Development will complete this process.

The process for obtaining an e-commerce license in Abu Dhabi or any other location involves three main steps. Firstly, you must submit your application form along with the required documents. Secondly, you need to pay the necessary fees. And lastly, wait for the authorities to issue your license.

Also, it’s very important to obtain the necessary approval of the Telecommunications Regulatory Authority to operate your e-commerce business.

Here you can learn how to apply for a Trading License and a General Trading License in the UAE.

6. What do you need to consider before starting an e-commerce business?

Before you build your e-commerce business in the UAE, you must take into consideration several key elements. For example, here we will briefly explain five key factors that will ensure a profitable future for your business. Nonetheless, it is always fundamental to think of other possible details of great importance before getting started.

6.1. Choosing the most suitable jurisdiction.

An investor can choose between setting up their e-commerce business in the UAE Mainland or Free Zones. However, it is important to obtain relevant information about each option before choosing. Making that decision will mostly depend on the nature of the business, the available budget of the investor, and many other details.

6.2. Designing and developing your website.

Among the most vital elements of a successful e-commerce business, there’s your website development. Although building and testing can take time, the effort will be worth it. It’s important to develop a functional and attractive website since it’ll be the platform on which you’ll sell your products. Besides, it’s the main tool for consumers to purchase what you offer.

6.3. Make sure to include online payment options.

Building your website must include adding secure payment gateways for consumers. Besides, it’s essential to develop several options, including credit card payment, pre-paid card payment, and many other convenient options. In some situations, the COD (cash-on-delivery) payment option can be very useful for you and your consumers too.

6.4. Take into consideration logistics, storage, and delivery systems.

Since e-commerce involves physical goods to trade or sell, you must have an appropriate warehousing service to store products. Also, you must have proper office space too. Once you cover these necessities, it’s important to create an efficient logistics system to deliver your products to consumers. You can either build your own system or opt for third-party logistics.

6.5. Develop your market strategy and market your products.

Once you have completed configuring your logistics strategy, the next one you need to configure is your marketing strategy. The most suggestible strategy that you can apply is targeting the right customers. Aligning your goods and products to the consumers can be the most efficient way to make your business thrives quickly.

Here you can learn about the company formation process in free zones like Ras Al Khaimah Free Zone.

7. How can you set up an e-commerce business in the UAE?

Setting up any type of company in the UAE requires a simple process to complete. However, some stages of this process can vary according to the location, the company structure, and other details. Let’s take a look at some basic steps that all business setup process in the UAE involves:

• Firstly, the investors need to specify their business activities and determine the license they need. After that, it will be necessary to choose a name for the business. Investors must be aware of the relevant rules when choosing names for their businesses.
• Secondly, it will be essential to select a convenient business location. And as we mentioned before, investors can choose between the mainland and the free trade zones. This decision will mostly depend on the circumstances of each investor.
• Thirdly, investors must gather and submit the required paperwork to the relevant authorities. Besides, they will also have to complete all relevant forms, apply for a license, and pay the necessary fees. After this step is done, it will be a requirement to open a bank account to perform all operations.

If you complete this entire process, you will be able to start operating your e-commerce business in the UAE.

Here you can learn how to apply for a Software Development business license in the UAE.

8. How can Connectfz help you set up your e-commerce business in this country?

Due to the COVID-19 pandemic, the e-commerce industry is more profitable now and you should start your e-commerce business. If you count on Connectfz as your partner, we will help you build your business in a matter of time. This way, you will be able to avoid tedious procedures and save time and money.

Besides, we can help you select your business location before getting the process started. You can choose the one that fits your needs better. Moreover, you will have a wide range of packages to choose from. Our packages include essential elements that your business will need, such as licenses, visas, facilities options, and more.

If you need help to keep running your e-commerce business once it is set up, we can still help you. We also offer a wide range of support services that can help you improve your business. For example, if you want to enter your target market quickly, you can request our UAE market entry services.

Would you like to contact Connectfz to obtain more information about the business setup process of an e-commerce company in the UAE? If you have any questions, call us on +97143316688. You can email us at info@connectfz.ae, and you will talk to one of our representatives who will answer your questions.