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Co-Founder & CEO movingo
Editor
Author
Iakov Kukushkin
Copywriter, Journalist
Apr 16, 2025
The UAE dropshipping market is expected to reach over $2.7 billion by 2030, growing at an impressive 7.74% yearly. It has already generated over $1.7 billion, so it looks like a good time to start your new business in this niche.
In this article, we'll take a look at the first steps you can take, the bumps you might encounter along the way, and how much it will cost.
In this article, we'll take a look at the first steps you can take, the bumps you might encounter along the way, and how much it will cost.
- What is dropshipping and how does it work?
- How does dropshipping work?
- The basics: taxes and payment systems for dropshipping businesses
- What to choose to start? Different types of dropshipping businesses
- How do you start a dropshipping business in Dubai and the UAE: step-by-step guide
- Documents required to start dropshipping business in Dubai
- Best dropshipping suppliers in the UAE
- Best payment gateways for dropshipping in the UAE
- What does it cost to start a dropship business in the UAE?
- Is the dropshipping license mandatory?
- Sounds too good. What are the downsides of dropshipping in the UAE?
- Top tips to make your UAE dropshipping business successful
- Dropshipping FAQ
What is dropshipping and how does it work?
Dropshipping is a business model where you sell products online without keeping them in stock. Instead, you purchase the items from a supplier, who then ships them directly to your customers.
How does dropshipping work?
Customer places an order on your online store.
You purchase the product from your supplier.
The supplier ships the product directly to the customer.
You earn the price difference between what the customer pays and what you pay the supplier.
Why is dropshipping profitable?
- Low startup costs – No need to buy inventory upfront.
- Flexibility – Work from anywhere with an internet connection.
- Wide product range – Sell various products without holding stock.
- Scalability – Add new products easily as your business grows.
Benefits of starting a dropshipping business in UAE
- Low investment, high potential – No upfront capital required. Easy to start and easy to scale.
- Ability to reduce taxes to 0% – If you are earning up to AED 375,000.
- Strong logistics network – The UAE has a world-class shipping and fulfillment infrastructure. This ensures faster delivery.
- Access to global suppliers – Easily source products from top suppliers worldwide, including China, Europe, and the US.
The basics: taxes and payment systems for dropshipping businesses
- The UAE has a 5% VAT on sales. This must be taken into account in pricing. There are also some zero-rated supplies and VAT exemptions.
- You have to pay 9% Corporate Tax on yearly taxable income above AED 375,000. Income up to AED 375,000 is tax free.
- Payment gateways like Stripe, Telr, and PayTabs support dropshipping businesses.
What to choose to start? Different types of dropshipping businesses
How do you start a dropshipping business in Dubai and the UAE: step-by-step guide
1
Create a business description
Write a detailed business description or business plan for your future company and send it to us by email.
Write a detailed business description or business plan for your future company and send it to us by email.
2
We’ll schedule a call
Our expert consultants will review your business plan and schedule a call with you. We will understand your needs and create the best solution for your e-commerce business. Our goal is to help you save time and money during setup a business in the UAE.
We always give you at least two good options to choose from, so you can pick what works best for your business goals and budget.
Our expert consultants will review your business plan and schedule a call with you. We will understand your needs and create the best solution for your e-commerce business. Our goal is to help you save time and money during setup a business in the UAE.
We always give you at least two good options to choose from, so you can pick what works best for your business goals and budget.
3
You’re license will be ready within a week
Good planning is key — when we know what to do, things are done really efficiently. After you receive a license, you can get started with your dropshipping business.
Good planning is key — when we know what to do, things are done really efficiently. After you receive a license, you can get started with your dropshipping business.
Documents required to start dropshipping business in Dubai
- passport copy;
- passport photo 33 x 44 mm;
- portrait picture with passport;
- every shareholder’s mother’s & father’s full names;
- every shareholder’s home country full address;
- every shareholder’s phone number;
- every shareholder’s religion (we usually mention Christian);
- every shareholder’s educational qualification (profession & country of diploma issuance);
- every shareholder’s marital status;
- last visit arrival stamp (if you are inside the UAE now);
- 3 potential company names in the order of priority.
Best dropshipping suppliers in the UAE
Depending on your niche, you may have different vendors to choose from:
- Local platforms: Tradeling, Noon, SupplyVan
- International platforms: AliExpress, CJ Dropshipping, SaleHoo
How to choose the best supplier?
- Focus on your specific goals and needs.
- Evaluate product quality and customer reviews.
- Consider shipping times and associated costs.
- Ensure the return policies are fair and customer-friendly.
Best payment gateways for dropshipping in the UAE
- Stripe – Supports multiple currencies, user-friendly.
- Telr – Popular in the UAE, integrates with various platforms.
- PayTabs – Secure and well-known in the Middle East.
What does it cost to start a dropship business in the UAE?
Aprox. AED 18,000 / $ 4,900
Costs will vary depending on the situation, but you can look at this figure to understand how much you need to spend on documents for a launch.
Is the dropshipping license mandatory?
Yes, it’s mandatory. According to the law, you need a business license to operate any kind of business—online or offline. Without a license, it’s illegal, and you could face fines or even legal action.
Sounds too good. What are the downsides of dropshipping in the UAE?
- Competition – A crowded market with many sellers in the same niche.
- Long shipping times – Delivery depends on the supplier’s location.
- Low-profit margins – Intense price competition can shrink profits.
Top tips to make your UAE dropshipping business successful
- Conduct thorough research and choose a high-demand niche.
- Build partnerships with reliable suppliers.
- Ensure your website is mobile-friendly.
- Allocate resources for effective marketing.
- Deliver outstanding customer service to foster trust.
Dropshipping FAQ
No, you do not specifically need an LLC to do dropshipping in the UAE. However, you must register some type of legal company to operate your business legally. This can be an LLC or another kind of business structure. Registering a company will help you follow the rules and give you access to better services, like reliable payment gateways. We can help you set up the right type of company for your business.
Technically, yes — but it won’t be easy.
Yes, by law, you must have a business license.
Yes, you must obtain a trade license from either the Department of Economic Development (DED) or a Free Zone authority.
It typically costs between AED 10,500 and AED 25,000, depending on whether you choose a Free Zone or Mainland setup.
Yes, dropshipping is fully legal in the UAE.
Yes, Dubai’s thriving online shopping market makes it an excellent location for profitable dropshipping ventures.
Yes, Shopify is fully accessible in the UAE.
Start by setting up your store, integrating payment gateways, and collaborating with reliable suppliers to streamline your operations.
Yes, Amazon UAE supports dropshipping through its seller program, provided you adhere to their policies.
Yes, you can sell to international customers — just make sure your suppliers provide global shipping options.
Partner with suppliers who have strong return policies, and make sure your store’s refund policies are clearly communicated to customers.
A 5% VAT applies to sales within the UAE, and either 0% or 9% Corporate Tax, depending on the circumstances.
Yes, the UAE’s e-commerce market continues to expand, making dropshipping a lucrative business model.
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