Dubai is a global trading hub with thriving businesses in various industries. Everything from cars and clothing to technology and construction materials is brought in, sold, and stored here.
Warehousing is particularly important. Businesses in the UAE often purchase goods in large quantities from abroad and store them before selling. Additionally, many companies manufacture products in Dubai, storing them before exporting worldwide.
If you can offer storage and warehousing services, there's a significant market opportunity. To get involved in this business, you'll need a trade license.
Advantages of Storage And Warehousing in Dubai, UAE
Obtaining a general warehouse license in the UAE opens up a valuable opportunity. the country does a lot of importing and exporting, warehouse services are in demand. Here are some benefits:
- Tax-Free Environment: You won't have to worry about taxes eating into your profits.
- Business-Friendly Atmosphere: The UAE makes it easy to do business.
- Vast Market Potential: There are plenty of opportunities in this large market.
- Simple Setup: Starting your business is straightforward.
- Cost-Effective and Profitable: You can run a business that's both affordable to start and lucrative.
- Flexible Warehouse Choices: Various warehouse options are available to suit your needs.
- Low Entry Barriers: It's accessible for new businesses to enter this field.
Permitted Business Activities for Storage and Warehouse Business in Dubai
Running a storage and warehouse business in Dubai involves managing the flow of goods, information, or services across the supply chain. The government of Dubai legally allows the following types of warehouse business activities:
3PL (Third-Party Logistics)
This covers service contracts that encompass shipping and storing products. It includes providing transportation and storage services for your clients.
Freight Brokerage
This involves offering land, air, and sea freight brokerage services, including customs and insurance brokerage.
Warehouse Storage
Warehouse activities encompass storing goods, packing, handling incoming and outgoing items, and organizing raw materials, among other tasks.
Customs Broker
Customs brokers prepare customs declarations and bills of lading and represent declarants with customs authorities.
Land Cargo Transportation
This includes transporting goods by rail and road, expediting shipments, and managing groupage shipments.
Air Cargo Transportation
Services for air cargo transportation encompass tasks like packing and sorting at airports, air freight, freight forwarding, air fleet management, and leasing.
Sea Cargo Transportation
Licensed sea cargo transportation services cover various aspects, including the transportation of goods by roll-on/roll-off (RORO) vessels, containers, and bulk sea freight. It also includes sorting, packing at seaports, and container and vessel leasing, among other services.
Choosing Location for Warehouse Business Setup in Dubai, UAE
Choosing the right business structure & location is vital when launching a storage and warehousing business in Dubai, UAE. Options include:
- 1. Warehouse Business Setup in Free zone: In Dubai and across the UAE, there are many special areas called "free zones" that are designed specifically for warehouse businesses. These places are great for warehouse companies because they offer good opportunities for making money. Just like regular areas, these free zones have good connections by canals, roads, and airplanes. This makes running your business there easy. Plus, the free zones have excellent facilities and are in great locations. Yet, there are some important rules to be aware of when opting for free zones:
- You can only do business with clients who fall within your free zone license's specific economic region.
- There might be limitations if you want to collaborate with government bodies, large local companies, or businesses located in the mainland.
- 2. Warehouse Business Setup in Dubai Mainland: Many businesses prefer setting up warehouses in the mainland due to the benefits provided by the government. These advantages include easy access to local markets and efficient product distribution. Opting for the mainland is ideal for those who want full control over their company and the flexibility to sell both locally produced and imported goods.
Consider factors like your Warehousing services, target market, and long-term goals when selecting a structure, and consult legal and business experts for guidance.
Steps to Launch a Storage and Warehousing company in Dubai, UAE
To set up a storage and warehousing business in Dubai, you can follow these simple steps:
First, figure out what exactly your warehouse will do. Are you storing goods, handling logistics, distributing products, or offering extra services? This helps you know what your business needs.
Decide if you want to start your company in the city (mainland) or in a special economic zone (free zones). Each place has its own rules and advantages. Pick the one that suits your business plans.
Pick a name for your business that's not already taken and follows the naming rules of the place you chose earlier.
Tell the Department of Economic Development (DED) about your chosen name. They'll check if it's okay to use and follows the rules. No rude or restricted words, please.
Get all the papers you need and apply to the right people, like the DED. Pay the fee for the license and any other permits.
Once you have your license, ask for visas for you and your team. Follow the rules and show the papers they ask for. You might also be able to bring your family.
Make a special bank account for your warehouse company. This helps you handle money and pay bills. Talk to experts or your bank to make sure you do everything right.
Remember that the process may vary depending on your chosen jurisdiction and warehousing company activities. Consulting legal and business experts familiar with Dubai's business setup landscape is highly recommended.
Looking for a seamless business setup experience? Trust Smart Zones® Dubai to pave the way.
Documents Needed to Begin a Warehouse Business in Dubai, UAE
Starting a warehouse business in Dubai requires minimal paperwork. Typically, you'll need colored photos of the owner and shareholders, a copy of your passport, and a completed license application form. However, it's important to have the following documents ready:
- Document confirming the legal agreement for your company's physical address.
- Passport copies of the shareholders.
- Memorandum of Association (MOA) and Attested Articles of Association (AOA).
- Evidence of trade name reservation.
- Personal information of the managers and shareholders.
- Confirmation of initial activity approval.
Cost of Establishing a Warehouse Company in Dubai
The price of getting a license for a Storage And Warehousing Company varies based on a few things. These include how much electricity you use, if you need special features like cold storage, the size of your space, and whether you do any manufacturing.
For instance, if you want a warehouse in the Sharjah Airport Free Zone that's about 125 square meters, it'll cost you around AED 48,000 every year. But in the SAIF Zone, they have lots of different-sized warehouses you can rent, starting from 80 square meters, 120 square meters, and even larger ones. They might also have custom deals just for you.
You pay for renting the warehouse every year to keep using it in the next year. This is similar to how you renew your warehouse license in Dubai and your company's trade license every year.
Dubai's strategic location as a global trading hub, coupled with its thriving industries and tax-free environment, makes it an ideal place for storage and warehousing businesses.
Some benefits include a tax-free environment, a business-friendly atmosphere, vast market potential, simple setup procedures, cost-effectiveness, flexible warehouse options, and low entry barriers.
The government of Dubai allows various activities, including Third-Party Logistics (3PL), freight brokerage, warehouse storage, customs brokerage, land and air cargo transportation, and sea cargo transportation.
Free zones offer tax benefits and are suitable for specific economic regions, while the mainland provides easy access to local markets and full control over business operations. Consider your business goals and target market when deciding.
The steps include understanding your business operations, choosing a location, selecting a unique name, obtaining permission for the name, filling out forms and paying fees, obtaining visas, and opening a business bank account.
Required documents typically include colored photos of owners and shareholders, passport copies, a completed license application form, a legal agreement for the company's physical address, Memorandum of Association (MOA), Attested Articles of Association (AOA), trade name reservation evidence, and personal information of managers and shareholders.
The cost varies based on factors such as electricity usage, special features like cold storage, space size, and manufacturing activities. For example, a 125-square-meter warehouse in Sharjah Airport Free Zone costs approximately AED 48,000 annually, with different options available.
Want to know more, talk to Smart Zones® Dubai advisory team they will be happy to help. Ready to invest in your future?
