This article describes the process to launch a business trading in foodstuff.
The UAE is a country that has a heavy reliance on food imports due to its limited supply of fertile land and freshwater. Private businesses of all sizes import foodstuff from all over the planet to meet local demand.
Understand the Market for the Business
As with any business, the first step before starting a business should be to research the local market. Entrepreneurs may discover those specific foodstuff categories are dominated by big wholesale suppliers and therefore are not profitable to import. You will need to focus on segments that have good profit margins.
Some foodstuff traders have found success in focusing on specific segments of the ex-pat market. You may find that some people are homesick for their local foods; therefore, they are happy to pay a premium price for the products. Some importers specifically focus on specialty foodstuff products from Eastern Europe, Russia, the United Kingdom, or Latin America.
Another factor to consider is how you plan to sell foodstuff products. Are you going to sell wholesale to grocery stores, restaurants, or catering companies? Will you be selling directly to consumers via an online shopping portal? The options are endless; however, it is critical to narrow down your sales channels.
UAE is also working to develop its local agriculture and food manufacturing sector to become food secure. With a foodstuff license, you could also export products from the UAE to international markets. UAE products and fresh produce have developed a strong reputation in recent years, and with ever-increasing investment in new technology in this sector, the possibilities are endless.
Incorporation Process of Foodstuff Trading Business
Depending on your business model, you can opt to get either a free zone or a local license. The free zone license will give you full ownership, while a local license requires that you partner with a UAE national or entity. The limitation with a free zone license is that you will have to go through a local distributor to sell in the local market. Doing so can eat into your profit margins. However, if your business trades outside of the UAE or engages in UAE foodstuff export, then a free zone license can be the more practical and affordable option.
Dubai Municipality is the authorized body to provide approval for foodstuff trading in Dubai. It established the rules, regulations, and policies for monitoring the trading of all food products in the Emirate. The food codes are amended from time to time; therefore, it is critical to ensure that you abide by the latest guidelines and policies to get a business license.
You will need a physical site for your trading business. If you plan to hold food on-site, you will need to make sure the site is up to the Dubai Municipality code. Your business is subject to inspection and can face hefty fines if you don’t uphold food safety principles.
Get Professional Advice to Help You Get Your Foodstuff Trading License!
We have helped countless foodstuff traders accomplish their dreams of owning a successful business. Let us help you with your business setup in Dubai and give you some free tips on making your business a success. We provide a free no-obligation consultation that can put you on the right path. Please don’t delay; give us a call today!
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