The United Arab Emirates is one of the world's thriving and growing marketplaces. Since the advent of the internet, the e-commerce business has experienced steady growth. Especially in the UAE, online companies are accelerating their pace, and traditional models are undergoing a positive transformation as well. The reason behind the thriving business models in the UAE is the modern trading, infrastructure growth, and consumer requirements. Everyone wants to get products at their doorsteps without having to go to the markets. As the UAE and its cities, such as Dubai, are a favourite business hub for every entrepreneur, there are high growth opportunities for e-commerce businesses in these markets. Let’s discuss the top 5 e-commerce business models that are expected to thrive in the UAE.
B2C (Business-to-Consumer): The B2C business model is one of the most popular in the world, as well as in the UAE. The reason behind its popularity is the ease of shopping and convenience. Myntra, Walmart, and Namshi are strong examples of how these business industries cater directly to consumers, where one can purchase clothes, accessories, skincare, and more.
Marketplace Model: The Marketplace model has also become a go-to business choice for new entrepreneurs. The marketplace is a platform where not only your brand but also other brands can sell their products directly to consumers. This business model provides entrepreneurs with the opportunity to list their products and services, and let the marketplace handle the rest after the order is placed. Amazon, Walmart, and Etsy are a few major names that offer businesses a platform, alleviating the burden of owning their own stores.
Dropshipping: Dropshipping is a supply chain management model in which a third party handles one or more stages of production, shipping, or storage. In this manner, the businesses never actually receive or handle the product. The primary reason people adopt the dropshipping model is that it is cost-effective, eliminating the need for a physical warehouse and making inventory management easier.
Subscription-based Model: The new era of trade brings variety to the business. Subscription-based model is one of them. This is a place where customers pay a monthly, quarterly, or yearly fee to access products and services. Although this model is still being developed in countries like India, it is gaining popularity in the UAE, where people are focusing on making things easier.
B2B (Business-to-Business): B2B is another successful method in the e-commerce business pool. Unlike the B2C model, B2B companies sell their products and services to other companies, not to consumers. Software, hardware, and raw materials are prime examples of a B2B business chain. A company takes orders from various companies and then sells them through marketplaces or other channels. Since the UAE is a booming business landscape, Business-to-Business methods are spreading their reach on a broader level.
Top E-Commerce Businesses to Start in The UAE
Fashion: The Fashion and apparel industry is booming rapidly. Every day, you find new designs in the market. As fashion sense continues to evolve, people are becoming increasingly choosy about their attire. The fashion market in the UAE is projected to reach around $2,000 million USD by 2024 and is expected to grow by 7.3% over the next 3-4 years. Entrepreneurs aiming to start an e-commerce company in the fashion sector can capitalise on a potential opportunity, as the UAE is one of the most promising business markets.
Food: The UAE food e-commerce business is also making its mark in the thriving landscape. The sector is expected to grow at a compound annual growth rate (CAGR) of 20.5% by 2028. As the UAE is one of the favourite holiday destinations, the food business offers vast opportunities. E-commerce companies can capitalise on the UAE market's growing demand for time-saving food solutions by focusing on convenience-oriented services, such as ready-to-eat meals.
Health and Skincare: The Modern generation is very much focused on their health and skincare. As demand increases, the supply of relevant products also rises. Online sales account for a significant portion of the total beauty and personal care industry in the UAE, a rapidly growing sector. Growing consumer demand for convenience, innovation, and a wider variety of products supports the industry.
As we all know, the UAE is thriving in the e-commerce business; it's time for you to take the next step toward your dream business and make a global leap. At Markai Corporate Services, we provide tailored business solutions to meet your needs. From selecting the right business zone to handling the entire business setup process, we help your business thrive from day one.
