United Arab Emirates presents numerous opportunities for logistics companies: both new and already established.
For startups, it offers a way to gain a strong foothold through free zones and financial support from regional and international VCs. For established companies, its geography can reduce the cost and time of delivery to customers in Asia, Africa and Europe. And for both, it offers fast customs clearance and low taxes, which means less downtime and more profit.
If you’re thinking about launching a logistics startup in the UAE, or opening a branch of an existing business, you are in the right place. In this article, then, we’ll explore 3 ways to open a company in the UAE, with their pros and cons.
But before we talk about the “how” of starting a logistics company, let’s talk about the “why”:
What makes the UAE a solid choice for trade and logistics startups?
By 2025, revenues from trade and logistics markets across the GCC are on track to exceed $30 billion. This figure speaks to the great economic development of the Gulf countries, but it would have been far-fetched without the contribution of the United Arab Emirates. The UAE is a clear leader in the Arab world’s logistics. For instance, the World Bank ranked it number one among the Gulf countries in the Logistics Performance Index 2023.
The UAE leads the GCC logistics market for three reasons: favourable geography, modern infrastructure, and a growing volume of investment that private and government-backed VCs are pouring into the sector.
Favourable geography
The UAE’s coastline runs along the Persian Gulf and the Gulf of Oman, corridors of major maritime trade routes: Strait of Hormuz Route, Dubai-India Route, UAE-Southeast Asia Route and UAE-East Africa Route, linking the UAE to Africa, Europe and Asia. These markets are also close by air, with Hong Kong International Airport just 7 hours away, as well as Singapore Changi Airport and London Heathrow Airport.
Being “at the centre of the map” connects the UAE to a market of approximately 5.3 billion people and a GDP of $51 trillion.
Modern infrastructure
Geographical advantage applies just as much to the UAE as it does to its neighbours, but what this country has, that other Gulf nations (comparatively) lack, is infrastructure.
Dubai’s Jebel Ali Port alone handles more than 19 million TEUs annually through its 67 berths. Dubai International Airport helps move 1.8 million tonnes of cargo each year. And over 4,000 km of well-maintained, multi-lane highways stretch 558 km from Abu Dhabi to Ras Al Khaimah, connecting regional hubs.
Investment in logistics
Retail and wholesale trade are two of the largest contributors to the UAE’s GDP. For the UAE government, these industries are central to economic diversification — a long-term push to reduce dependency on oil and gas.
The UAE government has rolled out a range of initiatives to attract both global and regional businesses and committed billions in public and private investments through projects like the Dubai Industrial Strategy 2030.
Backing from venture capital funds, such as Mubadala Investment Company and Dubai Future District Fund, further supports startups focused on supply chain optimisation, automation, and digital logistics.
In short, it’s a huge, evolving market. And it’s on the rise.
Starting a logistics company in the UAE is easy, but there are hidden obstacles that can trip you up
It doesn’t take much time, effort or money to start a business in the UAE. You can even set up a company online, as some free zones have digitised the entire incorporation process. One example is the Dubai Multi Commodities Center (DMCC). This free zone accepts company formation applications through its website and sometimes issues licenses in less than a week. Costs start in the low thousands of $US.
Lack of red tape and affordability are, by all means, great things. But this same simplicity means that more of the responsibility for research and preparation lies with the entrepreneur. Essentially, It makes it easier to “wing it,” act spontaneously. But “winging it” can lead to costly mistakes.
For example, choosing the wrong economic activity can be a significant stumbling block. Economic activities in the UAE are classified under specific codes, and your chosen activity must match the scope of your operations. If you pick an incorrect category, your license might not cover your intended business activities, or you could face compliance issues later on.
Adding to this complexity is the distinction between mainland and free zone companies, each with its own rules and regulations. Even within free zones, there are varying jurisdictions, and what applies in one zone might not be valid in another.
When it comes to setting up a logistics company in the UAE, entrepreneurs typically have three main options.
The first option is to handle the process yourself. This involves dedicating substantial time to study all the requirements and prepare the necessary documentation for incorporation. In logistics, even minor errors, such as missing a specific customs code or incorrectly filling out forms, can result in delays or rejections, costing you weeks or months and potentially thousands of dollars.
The second option is to hire a business consultancy. While this can streamline the process, it comes at a price. Well-established firms charge premium fees, which may not be within reach for newer logistics startups. Cheaper agencies might seem like a viable middle ground, but they carry risks — there’s no guarantee they have the expertise to navigate the complexities of logistics regulations. If things go wrong, you could end up with more wasted time and money than if you had done it yourself.
The third option is to use a specialised online platform like UPPERESETUP, designed to assist in setting up businesses in the UAE. This option combines the convenience of a DIY approach with professional guidance, minimising both cost and risk.
How UPPERESETUP helps set up a logistics business in the UAE
UPPERSETUP is a smart algorithm-powered service that simplifies the setup and management of companies in the UAE, specifically tailored for industries like logistics.
To get started, create a free account and provide basic details about your logistics operations. The smart algorithm assistant will guide you through each step, offering suggestions on appropriate free zones, customs procedures, cost estimates, and other logistics-specific considerations.
Below, we’ve outlined 5 key benefits of using UPPERSETUP to launch your logistics company:
- Automated expert guidance on the best place to set up your logistics company
UPPERSETUP simplifies the process of choosing the best location for your logistics business. After answering a few key questions, the platform provides tailored recommendations for the most suitable emirate, free zone, or mainland area based on your logistics operations. You can then compare options in terms of infrastructure, proximity to transportation hubs, regulatory requirements, setup costs, and long-term expenses.
- Real-time updates through a business dashboard
One of the most stressful parts of starting a logistics business is waiting for updates after filing your application. Government agencies can take weeks to process documents, and it’s hard to know if there are any issues with your submission.
UPPERSETUP’s business dashboard keeps you informed throughout the process. You can track your application’s status, edit documents, and receive real-time updates. Whether you need assistance from the AI assistant or prefer speaking with an expert, support is always available via the integrated chat.
- Cost control with transparent pricing
UPPERSETUP offers a flexible, cost-effective solution for setting up your logistics company. The platform’s smart algorithm service is free, providing step-by-step guidance that draws from years of experience in the UAE business environment.
You can follow the instructions on your own or choose to bring in professional help only when needed. This pay-as-you-go model ensures you maintain control over your costs without committing to expensive consulting fees. In some cases, you might even earn cashback for following certain steps, which can be used for further expert advice.
- Comprehensive support beyond company formation
In the logistics sector, simply opening a company isn’t enough. UPPERSETUP helps you with the entire setup process in the UAE, from acquiring visas and residency permits for your team to opening a bank account and setting up the necessary payment channels. The platform also assists in managing tax and accounting requirements, ensuring your business runs smoothly beyond incorporation.
- Access to an updated, centralised knowledge base
Navigating the legal landscape in the UAE can be tricky, especially with frequent changes to regulations. UPPERSETUP’s knowledge base is continuously updated by legal experts and smart algorithm, ensuring you always have access to the most current information. This centralised resource allows you to stay informed on the latest requirements and avoid costly mistakes, making it a reliable tool for your logistics business planning.
Wrapping up
The logistics sector in the UAE is growing fast and brings about a big opportunity if you know how to navigate the local regulations.
Whether you’re starting from scratch or expanding your business, it’s important to have a clear understanding of the rules. One way to do this is with UPPERSETUP — a smart algorithm-based online platform for starting a business in the UAE.
UPPERSETUP helps you choose the right location for your business, explains step-by-step how to prepare and submit your application, and provides on-demand legal advice from a team of professionals to help you succeed in the UAE logistics industry.
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