Viability of the Grocery business in Dubai
Dubai has become a business hub. All giant business houses are setting up their business here to reap high benefits from this market. Therefore, this has opened new avenues for the grocery sector, selling essentials. Grocery stores prove to be a great investment in Dubai mainland. For setting up a grocery store in Dubai, a grocery license is necessary.
What is a Grocery Store?
A grocery store is a store wherein, essentials such as foodstuff (canned, fresh, or preserved), utensils, detergents, and other household items are sold.
Opening a Grocery Store
A grocery shop is a lucrative business as it is highly profitable. Setting up a grocery store is a fairly simple process.
The Grocery shop owner has to get a commercial license from the DED. In addition to that, he has to get approval from the Municipality. A red and green ‘G’ logo has to be given for the grocery store.
Firstly, the company has to conduct market research. The viability of the product in the local market, its demand has to be checked. Secondly, the company has to select a local partner. Thirdly, the financial soundness of the business has to be analyzed. Initial investment reserves check, Passport & Visa approval, tenancy contract (Ejari) are also necessary.
Requirements for getting a Grocery license in Dubai.
Grocery store comes under commercial business, therefore a commercial license is required for opening a grocery store. Following are the requirements for initiating a grocery store:
- Local Sponsor: An Expat who is willing to open a grocery store in Dubai mainland can do so by appointing a local partner. The local partner will have 51% shares in the company. However, a Dubai national can start a grocery store with 100% ownership.
- Approval from municipality: The Grocery store has to comply with regulations by the municipality for appearance, walls, entrance, interiors, and likewise. reception, check out, racking system, storage, refrigeration are other rules to comply with. It also has to get approval from Public health and Safety Department in Dubai Municipality. Municipality grants approval by fulling these requirements.
- License: The DED issues the commercial license to start a grocery store in Dubai. The store gets the Initial approval by submitting the details of location , partner, trade name, trademark approval (from Economic Ministry). After that, the DED issues the Grocery license by submission of other documents. Documents required are:
- Passport and Visa,
- Ejari / Tenancy Contract
- Application of Shareholders
- NOC from Sponsor.
- Business Plan.
Subsequently, the DED issues commercial license to open a grocery store.
Rules to be followed for starting a Grocery Store
Following are some of the rules to be noted to start a grocery store in Dubai:
- A proper sales policy describing the acknowledgment, return, replacement of the product
- A company requires prior approval for changing the location
- DED should have complete information about the products sold
- The customer should get an invoice for the purchase
- The company must be registered for VAT
- Get prior approval for fixing coin operating machines
- The law prohibits the sale of products with the fake trademark
- The company should place an advertisement on the front wall only with a permit
- Products must carry manufacturing date and expiry date
- The store must get approval for selling goods on sale, discount or a special offer
- The prices of goods must be clearly visible
- The entrepreneur has to take permission to operate a 24-hour store
- The store should not sell medical, pharmaceuticals, cosmetics, herbal products, and the like
- The company must initiate a promotional campaign only after getting permission from the authority.
In conclusion, by following these rules and fulfilling the requirements a grocery store can easily be set up in Dubai.