How to Start a Shop in Dubai

by Zaara 13, Aug 2018

How to Start a Shop in Dubai

Anybody who has visited Dubai likely knows that it's a major shopping destination. The Dubai Shopping Festival is one of the most significant and most much-awaited events that grab global attention, as it offers different types of discounts and promotions.

This has become a ritual, making it a provoking factor that exponentially drives the retail industry, making it the second most beneficial segment in the nation.

With this, you can understand that the United Arab Emirates has a humongous platform for business investors and entrepreneurs who want to kick-start a retail shop in the zone.

This guide will give you the ultimate details that you should know before investing. Let's have a glimpse at the industry first!

The Retail Industry in Dubai

As mentioned earlier, the retail industry is one of the second-most booming industries in Dubai-UAE. There is no doubt that the pandemic had a massive impact on the same; however, the UAE retail industry has been showing positive signs of recovery over time.

A few of the critical findings that prove the same are highlighted below:

  • Consumer spending increased by 4.5% in 2021 as compared to 2019
  • The tourist spending has increased by 22%
  • Shopping malls saw an 11% increase in footfalls
  • E-commerce flourished insanely with 104%

Undoubtedly, we can see a massive spike in the retail business segment. However, one must understand that the retail part mainly depends on the domestic and foreign audience.

From the multi-national like Burberry & Hugo Boss to local brands like Zayan and The Label, investors find Dubai is a perfect home to proceed with the business activities.

As per the Khaleej Times report, the retail industry is expected to home an annual growth of 6.6% by 2025 ($70.5 Billion).

Opening a Store in Dubai – Business Segments You Can Target

Let's look at a few of the trending business segments that will turn out to be profitable when it comes to starting a store in Dubai.

  • Flower
  • Cosmetics
  • Fashion & Footwear
  • Perfume
  • Electronics
  • Home Furnishing
  • Jewellery
  • Grocery
  • Parlour
  • Exclusive Store

The above-stated business segments are just a few in the count. Dubai has no limits from clothing to an art and craft store. You can start any shop based on your interest which will help you grab your targeted customers' attention quickly.

Where's the Target Audience?

You need to understand that it becomes imperative to research your target audience.

Understanding your target audience's presence can help you choose the perfect space for your business.

Whether you want to be busy on the busy streets of downtown roads or choose a quieter place where you will benefit from traffic, there are many choices you can choose from!

Dubai has dedicated zones, namely, Dubai Mainland and Dubai Freezone, that one can proceed ahead with.

Opening a Shop in Dubai Mainland

Dubai Mainland is one of the perfect destinations for medium and large-scale business operations. The setup of a shop in the zone requires the business investors to hold a local sponsor, the owner of 51% of the business.

The license is to be obtained from the Department of Economic Development (DED), with relevant approvals from the Ejari, Ministry of Economy UAE, Dubai Municipality, and other authorities (depending on the business activity).

A few of the dedicated zones in Dubai Mainland include:

  • Sheikh Zayed Road
  • Business Bay
  • Deira
  • Al Qusais
  • Bur Dubai
  • Al Quoz

Opening a Shop in Dubai Freezone

Coming to the free zone option, it is suitable mainly for business investors with low investment. Most of the free zones allow the owners to reside in the zone along with their family members.

Depending on the business activity, the following locations can be chosen:

  • Aerospace or Logistics -Dubai Airport Free Zone Authority
  • Advertising or Media Agency -Dubai Media City
  • Tech shops- Dubai Silicon Oasis
  • Medical shops- Dubai Healthcare City
  • Finance & Legal- Dubai International Financial Centre
  • Jewellery & Precious Metals- Dubai Multi Commodities Centre

What's Next? Mapping the Process

Mapping the activities is always essential when you start a project, and thus, knowing the core essentials at the initial stage will help you streamline the process in a much better way.

1. Understand Your Business

Business owners are the makers of a business entity, and thus, understanding your business is one of the core necessities.

Understanding your business doesn't only deal with the working or operational model. You also have to get a clear idea about:

  • Target audience and their demand
  • Existing competitors in the market
  • Overall market scenario
  • Future possibilities
  • In-depth knowledge of the product or service offered
  • Mechanism of inflow and outflow of cash
  • Parties involved in the process (Distributors/ Suppliers etc.)

2. Choose the Jurisdiction

As stated in the previous section, the location plays an essential role, and thus, it needs to be finalized after understanding the significant elements of the business.

Make sure to analyze the business needs and decide the location. Once finalized, make sure to understand the norms for business operations.

3. Local Partner as a Stakeholder

If the business activities are to be carried out in Dubai Mainland, then you need to deal with local sponsorship.

This means that a local partner (preferably a corporate partner) will associate with you and hold 51% of your business, which is a must to complete the registration process.

4. Obtain the Approvals

The documentation part only gets complete after obtaining the approvals from the respective authorities.

If documents get rejected, make sure to consult with your business partner and submit the essentials after rectifying the same.

5. Understand the Laws of Hiring Staff

Once the approvals are obtained, you need to deep-dive into the following process to hire the right staff.

You have the leverage to hire local and international staff, depending on your business requirement. Have a look at Why Should You Consider Hiring Millenials to get a better idea during the hiring process.

6. Prepare a Budget Estimation

Lastly, it would help if you prepared a budget estimation, which will give you a roadmap regarding the inflow and outflow of business.

Understand the Biggest Asset – Time

There is no doubt that opening a shop or store in Dubai is a great way to give exposure and brand your products in the international market.

At the same time, you need to understand that time is the most valuable asset that one can have. Therefore, effective utilization of time can fetch more excellent results in less time, whereas misusing the same will bring in the opposite.

Considering this, you have to understand and accept the fact that you are a foreign investor. Thus, it nearly becomes impossible for anyone to understand and act according to the legal norms of the selected jurisdiction.

Collaborate With Expert- Commitbiz

Commitbiz Management Consultants is one of the growing business consultancy firms you can count on. Our experts are well-versed with every node from the initial step of incorporation to opening a bank account.

While you strategize the business moves, we will take care of your legal proceedings. For more information, feel free to get in touch with our experts. Contact us today-we'd be glad to assist!

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