Courier business has benefited from the explosion in the popularity of online shopping in recent decades. With a growing number of businesses that need to get goods directly to consumers, this could be the perfect time to enter this lucrative field. The purpose of this article is to serve as a practical guide for starting a courier business in Dubai.
Research the Local Marketplace for Courier Business
In Dubai, several large firms dominate the market for international deliveries, while many smaller firms operate on a national level or focus on specific countries. Doing some market research will help you to find out how much demand there is for the service you want to offer, the top services people want, and the going local rate in the market.
The research can help you discover if there are enough customers who will choose your business and how to target them. You might find that there is a gap in the market that you can fill. For example, perhaps a few companies offer immediate local deliveries for time-critical packages or documents. As a new small courier firm, you can provide a more personal level of service. People wanting valuable items or urgent documents delivered will be looking for a trustworthy service.
Remember that courier services can vary greatly, here are just some of the niches that you could consider fulfilling:
- same day local and UAE wide deliveries
- next day deliveries
- international deliveries through a global courier network
- weekend and night deliveries
- pallet services and bulky parcel delivery
- specialist item deliveries, such as motorcycles, pianos, medical, pets, and antiques
Courier Business License
To operate a courier business, you will need to get a local license through the Dubai Department of Economic Development. In addition to the standard requirements to receive a local license, you will need to get approval from Emirates Post. The special approval from Emirates Post takes approximately one month to obtain and requires a special fee of AED 100,000. You can complete all the formalities via their online portal for ease of use.
If you plan to have a fleet of delivery vans or outsource the delivery to third parties, it can have an impact on any further approvals you may require. For delivery fleets, you will need vetting by the Dubai Roads and Transport Authority. If you plan to focus on international shipping, you may need to satisfy requirements for customs clearance with local authorities. We would recommend you speak to a business consultant to understand all the formalities you need to complete to make your business operational.
Franchising Your Business
Dubai has had a steady growth of franchise courier business over the last two decades. Franchising means that you still start up your own business, but you can benefit from a well-established recognized brand and protocols. Many global franchise firms will offer you with detailed consumer and business insights that can prove crucial when starting your own business. However, all this comes at the price of having to make continuous franchisor fee payments.
Several international brands are actively looking to expand into the UAE. However, you could benefit from the first movers’ advantage and gain an exclusive right to the UAE market. The market for courier business, express, and parcel services in the United Arab Emirates is estimated to be valued at more than USD 1.6 billion. It is estimated to grow at a compound annual growth rate of 7.5%. In last, this opportunity can be a win-win proposition for you and the franchise firm.