Home to the world's biggest mall, two major shopping festivals, traditional souks, and the highest number of food and beverage business per capita in the world, Dubai is a shopper's paradise. There is no better place in the region to embark on some retail therapy than in Dubai.
Dubai's retail sector has witnessed an evolution over the past few years as it continued to establish as the main player in the global retail stage, proving that it can support growth, attract global brands, and meet changing market conditions. It will continue its dominance over the next five years, with a compound annual growth rate of 5.2% over the period, supported by strong international visitor spending, robust demand fueled by a high frequency of mega-sales and shopping festivities, and growing e-commerce business, according to new analysis conducted by Dubai Chamber of Commerce and Industry.
What Drives the Growth of Retail Sector in Dubai?
Since shopping in Dubai is vital to the economy, the Emirates feeds amazingly well to those who want to pay big. There are two significant events in the retail sector that pull in visitors from across the world. Dubai Shopping Festival, which lasts from January to February, is a monster sale with outlandish advancements where raffle prizes can include kilos to gold or luxury cars, to a backdrop of street fairs, fireworks and cultural activities. About 30% of yearly retail sales are made during this DSF. The celebration is so popular that 18 years ago, Dubai began a summer equivalent- Dubai Summer Surprises, held from June to August
There is another big festival that Dubai hosts GITEX Shopper, a bi-annual event of technology, and gadget promotions for the hundreds and thousands who settle on the Dubai World Trade Centre keen to get the deals but, it is not just the malls that dominate the retail sector. Over the past year, the city has shifted from the grandeur of malls to more unique, boutique-style locations focusing on local talent and brands.
Business Formation in Retail Industry in Dubai
Retail business in Dubai are aplenty, and so is the number of merchandise trading businesses. There are a few requirements that a businessman needs to adhere to start a business in Dubai. They are as follows-
- Select the Type of Business – The type of goods you deal with in the shop determines the kind of license that you need. There are more than 2000 activities listed in the Department of Economic Development, and you need to choose what suits your business the best.
- Take Support from the Local Sponsor – If you are setting up a retail shop in Dubai, then you must have a local sponsor who will have a 51% share in your business. This rule does not apply if you are establishing a business in the free zone.
- Obtain Commercial License – Now that you have chosen the business activity, it is time to apply for a Commercial License. Before this step, you must register your business with the Company Registrar. Documents required to submit to the DED Dubai and the UAE Federal Ministry of Economy to obtain the license are as follows.
- An application with a business name written in both English and Arabic
- Lease contract of the registered address of your office (original)
- A permit issued by the Dubai Municipality Building Department clearing the use of storage space as a business address for the retail store
- Proof of payment of license and fees
Submit these documents and get your license. Once you get the license, you can officially start your business. If you want a shop on rent, there are a series of permissions you must take from Dubai Municipality and other concerned departments.
There are a few things which must be completed after your retail business is set in Dubai. They are;
- Not having excess products on hand or having a fewer products, in short, proper inventory management is necessary
- Attracting customers by giving hefty discounts, offers, gifts, and so on
- Hiring friendly staff whose primary purpose should be going above and beyond customer satisfaction
- Creating a clean environment for your customers so that they keep coming back
Future of Dubai Retail Sector
Since Dubai is regarded as the shopping capital of Middle-East, it is highly predicted that the retail industry will continue to boom its way towards betting the number one driver of Dubai Economy. With Expo 2020 approaching, it is not hard to imagine how the retail sector will look like. According to the survey made by the Dubai Chamber of Commerce, an 8% annual growth by 2020 in the retail industry is indicated.
Don’t the numbers seem exciting to you? If you are interested in starting a retail shop in Dubai, then we at Commitbiz can help you with it. Our professional consultants are well-versed with the legal formalities and can make this process hassle-free. Contact us today.