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Online Selling in UAE

Selling Items on Social Media and other eCommerce Platforms– eCommerce in UAE

eCommerce in UAE is witnessing a rapid spike in growth, especially with the Pandemic. There is a rapid evolution in the eCommerce ecosystem in the region.

To become a social media seller and sell clothes, shoes, perfumes, or even own craftwork to customers, it is essential to apply for the right business license to operate legally in UAE. All economic activities in UAE are regulated and sellers need to have a valid trade license to operate.

Trade license and Ecommerce License Mandatory for Social Media Selling

There are a host of counterfeit items sold on social media platforms ranging from bags, perfumes, watches, accessories, and cosmetic products, etc. Hence, consumer protection and safety are essential for customers.

Selling Online in UAE

The Government of UAE is keen to eliminate such illegal transactions and has mandated the online seller to have a valid trade license and eCommerce license for conducting online sales.

Hence having a business license is mandatory for the businesses to remain safeguarded, obtain a legal shield, and for the UAE Government to keep track of any counterfeiting or illegal commercial activities.

UAE is becoming the Ecommerce Hub of the Middle East

UAE Is transforming itself into a global eCommerce hub with more companies venturing into the market, growing business infrastructure, technology adoption, and a rising population.

There are enormous opportunities for start-ups in the eCommerce sector in UAE. From selling goods online to logistics and technology support, the eCommerce ecosystem is growing in the region.

Selling Online in UAE Via Amazon

The Amazon FBA (Fulfilment by Amazon) is a becoming popular means to earn money through selling online via the Amazon online store.

For start-ups, traders, entrepreneurs, who wish to spread out their business and grow revenue registering as a seller in Amazon UAE is a prospective proposition.

Selling Online in UAE

 

The pandemic has led to a surge in digital interaction among buyers and sellers, and the Amazon FBA is an existing income-generating avenue that is growing in popularity in UAE.

The FBA Platform from Amazon to drive Online Sales in UAE

The FBA Platform from Amazon deals with third-party sellers as well as licensed sellers. Most of Amazon’s sales in the UAE come from third-party sellers.

What is ‘Fulfilment by Amazon’ (FBA)?

It is a popular way for the seller to directly shipping their products to an Amazon Warehouse, and Amazon will then handle the sale, which involves picking the product from inventory, shipping, customer service, and returns.

With the advent of Pandemic, the online space as a whole and Amazon has its active digital customers on a spike. Provisions such as the FBA helps individual sellers to raise their profit margin. It is working out for sellers as well customers to find their niche products online.

Order Fulfilment Options for Sellers in Amazon

There are three options for order fulfillment when it comes to selling products online via Amazon:

  • Pack and Ship the Product by the Seller (As Fulfilment by Merchant or as a Seller Fulfilled Prime)
  • Outsourced storage, packaging, and shipping to Amazon using FBA

The seller can switch between the order fulfillment process any time after they have put up the product for selling via the Amazon website.

That way, the seller can enjoy peace of mind and Amazon does the heavy lifting work of packing, sending out the order, handling customer queries, etc.

Cost of Storing your Products at Amazon Warehouses

There are storage and fulfillment fees to be paid to Amazon. The more the investor store, the more is the expense. Also if goods are stored for more than 180 days, the cost goes high. It is to increase the turnaround time and keep products moving.

With FBA, the storage and inventory fee is relatively cheaper. The seller need not spend large amounts of capital upfront for storage space.

Selling Online in UAE

Depending on the package sizes the cost of storage varies. For small and lightweight packages, the price is USD 5 and for the medium, to large heavy boxes, it is USD 13.

The exact quote will be received while setting up the account and enter the shipment information and before making the final confirmation.

Maintaining the required inventory of the product in Amazon’s Warehouse is the responsibility of the seller. also, the seller must follow the strict packaging guidelines of Amazon while delivering it to the warehouse. The packaging and delivery to the customer are by Amazon.

How to Start the Trading Business in UAE?

It is mandatory for a trader, entrepreneur, or start-up in UAE to have a valid trade license to conduct any form of commercial activity in the UAE.

For trading in the online space, an e-commerce license is mandatory. The seller can then open a seller account in Amazon or other online portals and conduct trade.

The Free Trade Zones of UAE and the Department of Economic Development in all Emirates issue the eCommerce license for the foreign investor. Based on the business activity and way of doing business the investor can choose the right business jurisdictions.

For more expanding the reach to more local business and venturing into UAE local retail, obtaining the trade license from DED is the right option. To drive more international trade and expand the business to new locations, Free Zone company setup is the ideal choice.

To know more about selling goods online and starting an eCommerce Company in UAE, talk to our expert team right away!

Aurion Business Consultants