Dubai has plenty of fertile grounds for starting your own business- be it in any field. The strategic location, world-class infrastructure and the presently booming trade scene contrive to make Dubai a prime destination for logistics businesses.
With the ever-increasing demand for efficient flux of cargo in the Emirates, and the logistics market being expected to expand approximately at a rate of 5.58%, there lies an open window that logistics entrepreneurs can tap into.
Between 2024 and 2029, the consumer per capita expenditure is predicted to increase gradually. And if you’re thinking of dipping your feet into this huge potential, below is a compiled list of things you should know before setting up your logistics business in Dubai.
Understanding the market landscape of any region before business setup in Dubai is a must. Without understanding the local or regional business culture, entrepreneurship can be rough. Here are some of the most important things you need to understand about the Dubai market:
Logistics is a broad term, and it includes a lot of things- from freight forwarding, last-mile delivery, warehousing, or a combination of two or three things.
Plan out a clear strategy of the niche that you want to set up business in. This will gradually help you to narrow down your field of expertise- thus helping you carve your own stable space in the current market.
Dubai offers both mainland and free zone options for business setup. As of today, mainland companies enjoy greater operational freedom but face higher costs and corporate taxes.
Free zones provide tax benefits and streamlined processes, but you might wish to look out for restrictions on where you can conduct business. And when you get started with the strategies, consider factors like your initial budget, target clientele, and long-term ideas for clear business goals.
The first thing to get done with is the necessary licenses for your business. Make sure to obtain the necessary nods from the relevant authorities, such as the Department of Economic Development (DED) or the free zone authority.
The specific license requirements will, again, depend on your chosen logistics activities.
Your company structure will decide the future of your business- decide on a legal structure for your business – sole proprietorship, limited liability company (LLC), or branch office to simplify things early on.
Each structure has its own advantages and limitations in terms of liability, ownership, and ease of setup. You might also wish to consult a business setup specialist to help you make the best choice.
If your business spans across the border in any way, or you are thinking of expanding overseas soon enough, then this is an essential step to get done with.
Depending on your nationality and business structure, you need to secure visas and work permits for yourself and/or your employees. Streamlining this process at the initial stages can ensure you a smooth operational launch.
After the initial layout of the business setup, now you can focus on something to give you an edge over the other businesses. This might require some brainstorming, but this is the most important aspect if you wish to stand out in the market.
A robust logistics management system (LMS) is crucial, researching and investing in software that streamlines operations, facilitates real-time tracking, and enhances customer service will take you one step ahead in the logistics market as compared to your competitors.
Customer service and the value you provide on it is another thing that can make you stand out entirely. Try to see what it is that you can offer beyond conventional solutions.
Catering to specific customer needs like specialised storage options or packaging solutions are something you might want to venture into.
In the cutthroat world of profits and business, collaboration is key. Make sure that you’re steadily building a solid network for your business, and try to collaborate or partner up with established freight forwarders, shipping lines, warehousing companies, and more to expand your network.
Navigating the Regulatory Environment
No business layout plan is complete without taking regulatory procedures into consideration. If your business setup is going to be based out of Dubai, you need to know the ins and outs of the regulatory proceedings related to your business.
If your goal is to take your logistics business international, familiarize yourself with Dubai’s customs regulations and procedures- or recruit people with expertise in the field.
This will ensure that your cargo business spends less time undergoing scrutiny and examination- giving you extra time credit to scale upwards.
Immediately from the get go, understand the tax implications of your business activities. Free zones offer tax exemptions, while mainland companies may be subject to corporate tax and import/export duties.
Understanding this may be one of the most important things you do in business- as tax laws are an integral regulatory matter. You might wish to hire a tax and a business consultant to help you out in tax as well as business compliance related matters in Dubai.
While the above are some things you simply cannot miss out on, here are a few additions to make sure your logistics business scales heights in Dubai:
Choose a strategic location for setting up shop, such that it is profitable for long term business, and bring together a team that helps you achieve that vision you have.
Goes without saying, but investing in robust technology to automate parts of your business is the best decision you can make- saving you both manpower, money, and hours.
There is nothing that speaks more to your consumer base than great branding. So, start building your brand, and while you’re at it, also take feedback and work on the areas that can be improved.
It may look challenging, but consistency and positive efforts in the right direction can definitely launch your business to a massive standpoint in a matter of time.
Dubai provides various opportunities for entrepreneurs who are planning to start a logistic business in Dubai, UAE. The various options for them include the following:
Entrepreneurs who are willing to start a new logistic business in Dubai can follow the steps below to get a brief idea of the formalities and procedures. Professional business set-up service providers like CDA can assist the new entrepreneurs to emerge as successful logistic business in Dubai.
1. Selection of the business activity: The first step includes the selection of the business activity based on its feasibility in Dubai.
2. Selection of the name: Selecting the name for the business is another important step, as it requires knowledge of the rules and regulations for selecting the name for the business.
3. Getting the trade licenses: Another step is applying for the trade license for the business and getting it issued by the authorities.
4. Select an appropriate location: Choosing the location is another crucial step as it decides the future of your business. A business set-up professional can be approached to get an appropriate location for your logistics business.
5. Prepare all the documents: The entities must ensure that they provide all the required documents for starting the business to the authorities. The detailed list of documents is provided below.
Entities planning to start a logistic business in Dubai must ensure that they maintain all the required documents before starting the business to comply with the requirements and avoid delays in the process. The general documents required by the authority include the following:
Dubai’s logistics sector presents many exciting opportunities for entrepreneurs- both looking for regional and international business. And by carefully considering the current market dynamics, following the setup procedures, and building a strong foundation, you can position your logistics business to thrive.
For a bottom line, staying informed, adapting to evolving regulations, and continuously innovating might just be your key to securing that competitive edge in the long run.
Here’s how you can learn more about our business setup services.
Consider this: You are a new entrepreneur in the arena, and wish to focus on air freight transport of authentic exotic fruits from overseas. Now this might include acquiring clients overseas in different countries, drawing up contracts, acquiring licenses for the same, setting up storage and packaging depots, checking if GI tagged produce may be available for the business, and more.
Now how do you go about setting up all of that, and growing your network to scale your business? Here’s where CDA can take over with the licensing, client contracts, tax implications, and more. Now, that leaves you with more time on your hands to strategize, plan, and build that business from the ground up.
Now you can worry about which exotic produces you want to source, instead of the licenses and tax application procedures.
