A comprehensive guide to setting up a fully functional eCommerce store in the UAE – from product selection to delivery.
As a new business owner in the UAE or someone looking to expand your current business using eCommerce as a channel, it can be a dauting task. There are many options, but few that exist catering for startups and small businesses with limited budgets.
At bfound we want to make life as easy as possible and help ensure you find the right solutions - from which software platform to build your online store, through to the type of business license and bank account.
Let’s start at the beginning. What do I need before I can sell online in the UAE?
Ok so let’s take these challenges down one by one:
Choosing Your eCommerce Platform
There are numerous options to get started with your eCommerce website. At bfound we recommend Shopify websites, which we feel are best suited for SMEs, new business owners and eCommerce entrepreneurs. Here’s why:
It is important to discuss your online shop design with an experienced Shopify developer in order to ensure it will be optimized for conversion. The Shopify website design by its nature already comes with themes that will drive more sales and Shopify websites are consistently the most popular with SME and startup customers.
Which License Do I Need?
If you want to sell to customers in the UAE or bank profits here, then you need a license. There are a number of eCommerce licenses available which fall into different categories.
As an expatriate from outside the GCC you are limited to the Freezones in the majority of cases. However, there is one exception to the rule, which is a license provided by the DED called DED E-Trader. This specific exception only works if you are selling handicrafts you’ve made from scratch and absolutely no trading is involved. Otherwise, this license is not applicable. In short you cannot import or sell items online without a Freezone license with the relevant commercial activities listed.
At bfound, we’ve helped numerous businesses get their licenses arranged and can connect you with a range of business setup companies specializing in Freezone licensing. Please visit the bfound partner page to see our preferred licensing partners.
Opening a Bank Account
Now that you have your license arranged, you can ask the Freezone authority to provide you a ‘bank letter’, which will allow you to open a bank account. This can be a little tedious as you navigate through the bank’s documentation requirements, but the SME banking process has improved quite dramatically with introduction of new digital account services. The process of opening a business account is now considerably shorter in most cases. This is especially true with some of the new banking services offered by banks such as Rakbank with their new Rakstarter SME account. As a Rakbank customer you can also receive discounts for bfound services.
Logistics
As a general rule start by focusing on one market. If this is the UAE, then you will need a last-mile delivery service to get your products to your end customer. Last-mile services pick up the goods from your home (or a warehouse if you’ve got one setup) and deliver them to your customers.
Your requirement for a warehouse will vary depending on a number of factors including the volume of orders, temperature control requirements and your budget. Typically, as a startup warehousing is expensive and having your goods picked up at home is a good place to begin.
Please visit our logistics partner pages where we have featured our preferred partners for logistics services that are very well suited to eCommerce and have full integration with Shopify.
Marketing
This is when life can get more complicated. Competition to get users to your website will be high and it is key to take a holistic approach covering various marketing methods to drive users to your website.
Remember that you are trying to win over customers who may already be comfortable in shopping from your competitors. You will have to give your target customers adequate incentive to buy from you and provide flawless service to ensure that they stay with you.
The following diagram shows the different methods of driving users to your website:
Take time to understand each of these areas and how they relate to both your product and target customers. It is better to be great at one area than to try and cover all bases.
In a subsequent articles we will break each of these down and provide feedback on some of the interesting new software platforms and services available to help you maximize ROI from these different channels.