Opening a grocery store in Dubai offers several opportunities and multiple trading avenues. These little stores sell a range of general food products and small items can be found all over Dubai and the UAE. The lucrative UAE market and large foreign investments have always made business setup in Dubai appealing and profitable. This in turn attracts small entrepreneurs to open a grocery store in Dubai.
However, every business setup is different and must follow different sets of procedures. The Dubai Government has laid out an easy process for individuals wanting to start a grocery store in Dubai.
Nevertheless, as a foreign entity entering the international market, opening a grocery store business in the UAE can require guidance and assistance. Therefore, you should get in touch with the business experts at Shuraa and we’ll help you obtain the grocery store license in Dubai.
Here are some factors that need to be taken into consideration when starting a grocery store business in Dubai.
Benefits of Opening a Grocery Store in Dubai
Dubai’s booming economy and diverse population make it a very attractive location to open a grocery store. Here are some of the key benefits:
1. High Demand
Dubai’s population is constantly growing, and a large portion of it consists of expatriates from all over the world. This creates a high demand for a wide variety of groceries.
2. Ease of Business Setup
The government of Dubai has made it relatively easy to set up a business, with streamlined procedures and free zones offering additional incentives.
3. Lucrative Market
The grocery sector in Dubai is a multi-billion-dollar industry and is projected for further growth. This translates to potentially high profits for business owners.
4. Free Zone Opportunities
Setting up your grocery store in a Free Zone can offer additional benefits like 100% foreign ownership, simplified regulations, and exemptions on import and export duties.
5. Events and Expo Opportunities
Dubai frequently hosts major international events and expos. This presents a chance to showcase your grocery store’s offerings to a wider audience.
6. E-commerce Integration
Dubai has a thriving e-commerce sector. Integrating online grocery delivery or pickup options into your business can expand your reach and cater to the growing tech-savvy population.
How To Start a Grocery Store in Dubai?
Opening a grocery business in Dubai, involve several steps:
Step 1: Do Business Planning & Company Structure
Before you start a grocery store in Dubai, you need to decide your initial investments, reserve funds, business location, company structure, the type of license for your business, and study market trends.
Furthermore, you also need to consider the cost of a grocery license in Dubai alongside other approvals that you might need to run a full-fledged grocery store in the UAE.
Step 2: Choose Your Business Activity
Decide what kind of grocery store you want to open. Will it be a neighbourhood convenience store, a speciality store with organic or imported goods, or a discount grocer? With over 2,000 options, the specific activities listed will depend on the type of license you choose.
Be careful though, because operating outside those limits can lead to serious trouble with Dubai’s authorities.
Step 3: Gather Required Documents
Documentation is a mandatory requirement. The passport and visa of the owner(s) must be submitted along with the trade license application. It is followed by the tenancy contract, Ejari, approvals from the Municipality, trademark registration from the Ministry of Economy, and other submissions as required.
It’s imperative to have all these documents handy to ensure hassle-free procurement of a grocery store license in Dubai.
Step 4: Get Initial Approval From DED
To start a grocery in Dubai, the documentation must be submitted as per the guidelines laid out by the Dubai government and the Department of Economic Development (DED) in Dubai. After all the documents are thoroughly vetted, the initial approval is granted by the DED.
Getting initial approval means that the UAE government has allowed your business to be established in the UAE. If you do not receive this approval, you cannot go ahead with the next steps in the application process.
Step 5: Select A Trading Name
The trade name must be approved by the DED. It is extremely important that the trade name be the same on the license and on the signboard of the grocery store. The trade name, which is also called the commercial name, must be in accordance with the DED’s guidelines.
Ensure that you don’t include any derogatory terms or controversial words in your official name as this can land you in legal trouble. Moreover, refrain from using any reference to gods and use a person’s full name if you wish to keep it as your professional business name.
Step 6: Find a Suitable Location for Your Store
If you have already submitted the tenancy contract and finalised the location before the initial approval, you may skip this stage. However, if the location of the store is not confirmed or could possibly change, then prior approval must be taken from the DED.
Once you have the location finalised for your grocery store, draft the tenancy contract and get the Ejari.
Step 7: Apply Your Business License
Every business activity is grouped under a certain license type in Dubai. There are four categories of licenses: commercial license, professional license, tourism license, and industrial license. To get your grocery license in Dubai for your grocery business, a commercial license is a must.
Under a grocery license, only things listed as grocery items can be sold. It does not allow the sale of any products related to medical, herbal, pharmaceutical, or even cosmetics. Don’t forget to pay the grocery license fee in Dubai within the specified time to ensure that the issued license is always valid.
Step 8: Open a Corporate Bank Account
Before you may begin sending and receiving money in the United Arab Emirates, you must have a corporate bank account. This will be necessary for managing your business finances.
Step 9: Apply for Visa
Visa processing takes place simultaneously along with getting a trade license. At this stage, you will get your investor visa and may also apply for subsequent family and employee visas under the company.
Cost of Starting a Grocery Store in Dubai
The cost of starting a grocery store in Dubai can vary depending on several factors, but you can expect a range of AED 12,000 to AED 50,000 for initial setup costs. Here’s a breakdown of the main factors affecting the total cost:
- Government and municipal fees
- Business structure
- Office rent (Prime locations will naturally cost more)
- Staffing
- Visa fees
- Inventory
- Utilities (Electricity, water, and waste disposal fees)
- Equipment (Refrigerators, shelving, cash registers, shopping carts, etc.)
- Technology (Point-of-sale systems and inventory management software)
- Marketing and advertising
Due to the varying factors, it’s difficult to pinpoint the exact cost of starting a grocery store in Dubai. To get a more accurate picture, consider contacting Shuraa business setup consultants in Dubai. They can assess your specific needs and provide a customized quote for starting your grocery store.
Factors to Consider Before Starting a Grocery Store Business in Dubai
- Any amendment or changes in the license needs approval from the authorities involved, the municipality, and the DED.
- Any advertisements, promotions, banner ads, and wall stickers posted by the grocery store must have pre-approval from the DED.
- Products with fake trademarks are prohibited by law. Hence, ensure not to sell such products.
- To open a grocery in Dubai, you will need a VAT registration number and need to file tax returns as is mandated by the UAE government. Also, all sales must have a proper invoicing system. You don’t need to worry about the cost of a grocery license in Dubai, as you don’t need to pay any corporate taxes or customs duties. Moreover, the VAT rate is also 5%, which ranks among the lowest in the world.
Your decision to acquire a grocery store license in Dubai is the right one because of the booming economy, and lucrative business opportunities in this sector. Moreover, you also get appropriate support from the UAE’s government as they continue to introduce new reforms aimed at improving the existing business infrastructure and working environment for expats and locals.
To know more about how to open a grocery store in Dubai in the quickest and most affordable way, contact Shuraa Business Setup. Our expert business setup consultants will help you through the entire process. Get in touch with us today at +971 44081900 or WhatsApp at +971 507775554 or drop an email at [email protected].
If you are looking to start your grocery shop or baqala in Abu Dhabi, you can read this post: How do I open a baqala in Abu Dhabi?
Frequently Asked Questions
Is grocery business profitable in Dubai?
Grocery stores are community anchors. Stocked with convenience products such as food and drinks, small household necessities and more, a grocery store in Dubai is potentially very profitable.
How much does it cost to open a grocery in Dubai?
The cost of starting a grocery store in Dubai starts at AED 12,000 to AED 50,000 for the initial setup. The price varies depending on several factors, including rental, license, government and municipal fees, and other expenses.
How to open a grocery store in Dubai?
To start a grocery business in Dubai, involve several steps:
- Business Planning & Company Structure
- Choose Your Business Activity
- Gather Required Documents
- Get Initial Approval from DED
- Trade Name Reservation
- Choose Your Business Location
- Obtain Your Business License
- Open a Corporate Bank Account
- Visa Processing
