Pictorial representation of E-Commerce Business in Saudi Arabia

Guide to Start an E-Commerce Business in Saudi Arabia

by Shivaanjan 13, May 2024

E-commerce has revolutionised the retail industry by making everything easily available on smartphones in the comfort of our homes. The growth of e-commerce in Saudi Arabia has enabled a lot of companies to open up online businesses given technological advancements and changes in consumer behaviour.

E-commerce businesses in Saudi Arabia shot up post-COVID-19 pandemic. There was a significant increase in internet penetration and disposable income, creating a buzz and demand for online shopping, especially among the younger generation.

This article helps you understand the e-commerce market and establish a successful online business in Saudi Arabia.

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Study of the E-commerce Market in Saudi Arabia

The e-commerce industry in Saudi Arabia has seen a lot of recent developments. Here are some of them:

  • Online sales through e-commerce businesses in Saudi Arabia have increased by over 60 per cent across all categories.
  • The average number of online shoppers has increased by 50 per cent in recent years.
  • The e-commerce market is growing at a good CAGR.

These points highlight that opening an online business in Saudi Arabia is still developing and has vast untapped potential.

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E-commerce Business Model in Saudi Arabia

There are mainly two business models for setting up an e-commerce business in Saudi Arabia. One is a single-vendor platform and the other is a multi-vendor platform.

Single Vendor Platform

This model is appropriate if you are a single vendor selling your business offerings to various customers. It allows you to have complete autonomy in the supply chain management of the company.

Multiple Vendor Platform

This business model allows multiple vendors to sell their products/services to customers through one platform like Amazon. It provides you security while making a sale, deals with demand fluctuations, and avoids disrupting the supply process due to the availability of multiple vendors.

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How to Start an E-commerce Business in Saudi Arabia?

To fulfil your dream of establishing your online business in Saudi Arabia, you need to follow certain steps. It starts with conducting a market survey to identify a niche for your product and service offerings. The process involves:

  1. Business Structure and Name

Choose the appropriate business structure for your business and a valid business name. You need to finalize it by obtaining a trade name clearance certificate from the Saudi Ministry of Commerce.

Register your business with the Ministry of Commerce or the Saudi Arabian Ministry of Investment (MISA) and receive an Electronic Commercial Register (ECR) and tax card.

  1. Business Licenses

As a compliance measure, you must register your company on the Maroof platform to list your online business with the Ministry of Commerce. It eases opting for the e-commerce license and export/import license if you plan to trade outside the GCC.

Note: You might need other licenses and permits depending on the business activity.

  1. Build E-commerce Platform

Build or set up the e-commerce platform and get it tested by a small group, to identify and fix bugs. 

  1. Set up Financial Gateways

Opening a bank account and integrating it with international payment gateways that comply with PCI DSS is necessary to streamline financial transactions with your clients.

Now that you have fulfilled the major requirements to start an online business in Saudi Arabia. You just need to focus on providing good customer service and timely deliveries, backed by promotional activities. This will increase brand awareness and satisfy the targeted customer base.

Are you ready to capitalise on the opportunity to start an e-commerce business in Saudi Arabia? Contact experts from Commitbiz for a smooth business setup experience. We offer customised business solutions, helping you achieve your business goals.

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