Covid-19 is still not passed, but business, trade & logistics companies in UAE have resumed returning to normalcy with newer technology, positive enthusiasm and the will to overcome the virus. One sector that has sustained and grown significantly during global lockdown was e-commerce. Online shopping was the only option for a lot of residents in UAE for procuring necessities during these unprecedented times. The E-Commerce sector was successful in meeting the expectations and requirements of their customers. Millions of people in the UAE could lead a manage even during the lockdown because of a strong E-Commerce logistics framework at the backend. Hundreds of small, medium and big logistics companies put up a brave front to strengthen the eCommerce industry during such trying times. And now, with the opening up of the Dubai Commercity, An ideal opportunity for the logistics sector in UAE.
The upcoming Dubai eCommerce City will be a landmark addition to the city’s business horizon. It is slated to be the MENA region’s prominent e-commerce centre being the first Free Zone and has been built with the specific objective of helping e-retailers work effectively in the region. Located in the Umm Ramool region in Dubai, the city covers 2.1 million square feet and is being built with a $1 billion investment.
The city is located right next to the Dubai International airport, becoming an optimized gateway between the East and the West. The city’s strategic location is all set to fasten up the delivery and eCommerce fulfillments of the region because, for international exports and imports, it could drive a key advantage. The city has three distinct zones with office spaces for e-commerce businesses, warehouses built on 52,606 sq meters, and a social zone earmarked for dining and leisure.
Why is the opening of the Dubai Commercity good news for the logistic sector in UAE?
The MENA region’s E-commerce sector is growing at a CAGR of 35%, which marks an upward trend. With rising demands globally, there is a unique golden opportunity for the logistics industry globally to grow manifold times.
The logistics sector in the UAE contributes 13% to the GDP of the country. APAC, Latin America and MENA are three of the fastest-growing e-commerce regions in the world today.
The new dedicated eCommerce City backed by the EXPO 2021 and the 2030 Industrial plans of UAE, the supply chain segment is surely in for sound growth and development opportunities. All this in the backdrop of the travel and tourism sector and cargo flows opening up. All of this leads to increasing the scope of work for logistics companies in UAE.
The pandemic showed the way. Logistics companies responded to the growing demand of the e-commerce industry during the Covid-19 lockdown. They fast-tracked their growth and made key changes to their strategies. They increased their investments to cope with the demand. The logistic sector played a vital role in deliveries and transformed the last mile solutions.
A key component that will ensure the success of Dubai CommerCity is the logistics infrastructure it develops. E-retailers in the CommerCity can succeed only if their customer orders requests are met on time. It requires high-speed and effective supply chain management. That is why logistics companies in UAE can contribute considerably to the success of the Commercity. No doubt, SCM and logistics are considered the cornerstone of eCommerce. All eCommerce industries need a professional and well-developed supply chain to meet their customer needs.
These are why the opening up of the Dubai e-Commerce City will be good for the logistic sector in UAE.
- First Mile and the Last Mile are the two pillars of the SCM of the e-commerce industry.
- First Mile helps transfer goods using Road Freight services in the UAE. The goods are picked up from the manufacturer’s factory to reach a warehouse or a fulfilment centre, airport, or transportation hub. Seamless processes are the key here and can come only from professional and well-managed logistics companies.
- Warehouse or fulfilment centre- the Dubai Commercity already has a full-fledged infrastructure being offered by the management. With automated and the latest technology, the space available can be used with greater flexibility and mobility. It would enable effective picking, packing and quicker replenishment of products to fulfil orders faster.
- Last Mile: the ultimate link that helps the eCommerce sector fulfil orders with optimized speed and effectively. Delivery delays can frustrate customers, and a strong and sound logistics framework can fix these issues aptly. It is important to mention here that every region has its specific issues; for example, some MENA countries do not have street addresses. In such cases, deliveries are bound to get delayed. Last Mile delivery challenges are relatively higher in the UAE (about 15%), leading to customer frustrations and revenue losses. A capable logistics company in UAE can overcome these issues with the Dubai Commercity offering hi-tech fulfilment centres and advanced technology for shipment monitoring in real-time.
- Return Logistics or reverse logistics also need attention wherein a well-developed logistics company can offer incredible support.
The need for professional logistics companies is only going to grow from hereon. Professional and experienced logistics companies have the necessary experience and expertise to ensure that the e-commerce sector can fulfil customer orders competently and proficiently. Also, hiring professionals means a cost-saving for eCommerce companies because they have the right people, technology and equipment for effective execution. It also gives eCommerce companies the time and scope to work on their products and improve the same to drive customer loyalty and branding.
E-commerce companies need to look for a logistic company in UAE that are experts in offering end-to-end support services. Starting from the First Mile and last-mile deliveries, cross-border shipping, reverse logistics, customs clearances, documentation, and paperwork support, proficient logistic companies can transport goods seamlessly, fast, reliably and effectively.