A Warehousing and Storage Business is a type of business that provides storage facilities and logistics services to individuals and organisations for their goods and merchandise. These businesses offer a range of services including receiving, storing, inventory management, order picking, packing, and shipping of goods.
Warehousing and storage businesses are essential components of the supply chain for many industries, including retail, manufacturing, and e-commerce. They allow businesses to store and manage inventory efficiently and provide a centralised location for the distribution of goods. Warehousing and storage businesses may also offer specialised services, such as climate-controlled storage, hazardous material handling, and cross-docking services.
The success of a warehousing and storage business depends on its ability to provide secure, reliable, and cost-effective storage solutions. The business must have proper storage infrastructure, including shelves, racks, and pallets, as well as efficient warehouse management software to track inventory and manage operations. The business must also have skilled staff to manage the day-to-day operations, handle customer inquiries, and provide logistics support to clients.
For example, incoming shipments are received, unloaded, inspected, and stored in the appropriate location with inventory levels updated in the warehouse management system. Throughout the day, the business retrieves items for clients, prepares them for shipping, and manages administrative tasks such as updating client accounts, reviewing invoices, and responding to inquiries.
What is Dropshipping?
Dropshipping refers to a business model in which the retailer does not keep goods in stock, but instead transfers customer orders to the manufacturer, wholesaler, or another retailer, who ships them directly to customers. So they sell products online, but do not deal with inventory, storage, or shipping. Doba, Dubailist, and AliExpress are some of the websites that can facilitate dropshipping.
While warehousing and storage businesses may not be directly involved in the actual process of dropshipping, they can play a significant role in supporting the logistics and supply chain operations of dropshipping businesses.
First, the supplier or manufacturer who ships the products directly to the customers may operate a warehouse or storage facility where the products are kept before they are shipped. These facilities may be responsible for receiving, storing, and managing inventory, as well as preparing and shipping orders.
Second, some dropshipping businesses may choose to work with third-party warehousing and storage providers. These providers can offer additional services such as inventory management, order processing, and shipping. By outsourcing these functions to a third-party provider, dropshipping businesses can focus on other aspects of their operations, such as marketing and customer service.
Finally, some dropshipping businesses may choose to maintain their own storage facilities. This may be necessary if the seller needs to store inventory, samples, or other materials. In this case, the seller would need to manage their own warehousing and storage operations, ensuring that products are properly stored, organised, and managed.
5210.00 Warehousing and Storage
Warehousing and storage are crucial business activities that play a vital role in the logistics and supply chain management of various industries. It involves the operation of storage and warehouse facilities for all kinds of goods, including grain silos, general merchandise warehouses, refrigerated warehouses, and storage tanks, to name a few.
The storage of goods in foreign trade zones is also a key aspect of this activity, allowing businesses to store their goods without being subjected to customs duties and taxes until they are ready for sale or distribution.
Blast freezing is another service offered by warehousing and storage facilities that are particularly useful in the food industry, preserving perishable goods for extended periods.
Additionally, storage and warehousing facilities provide a secure and efficient solution for the storage of freight, allowing businesses to manage their inventory effectively and minimise the risk of damage or loss.
Overall, warehousing and storage are integral components of any supply chain, providing businesses with the infrastructure and support necessary to store, manage, and distribute their goods efficiently.
Exclusions
When it comes to warehousing and storage, there are certain exclusions that are worth noting. This activity excludes parking facilities for motor vehicles, which are typically separate entities from storage and warehouse facilities.
Similarly, the operation of self-storage facilities falls outside the scope of this activity, as these facilities offer a different type of storage service to individuals rather than businesses.
Finally, renting vacant space is also excluded, as it does not necessarily involve the operation of a warehouse or storage facility.
Third-party Approvals – Post License
If you plan to set up a business that offers Warehousing and Storage services, it’s crucial to seek approval from the Dubai Municipality, post obtaining a business license. This step is essential in ensuring that your business complies with the relevant standards and regulations established by the Dubai Municipality.
By obtaining approval, you will be able to demonstrate your commitment to maintaining high levels of quality and safety in your operations, which is essential in attracting and retaining clients.
5221.00 – Service Activities Incidental to Land Transportation
Service Activities Incidental to Land Transportation is a crucial business activity that includes a wide range of services related to the land transport of passengers, animals or freight. It encompasses the operation of terminal facilities, such as railway stations, bus stations, and stations for the handling of goods. These facilities provide essential services such as loading and unloading of cargo, warehousing and storage, and customs clearance.
This activity also involves the operation of railroad infrastructure, including tracks, bridges, and tunnels. This infrastructure enables the safe and efficient movement of goods and passengers by rail. Roads, bridges, tunnels, car parks, garages, and bicycle parkings are also part of this business activity. These facilities are critical for the smooth flow of traffic and the safe and efficient movement of vehicles, bicycles, and pedestrians.
Switching and shunting are other essential services provided by businesses engaged in Service Activities Incidental to Land Transportation. These services involve the movement of rail cars from one track to another, ensuring that cargo is delivered to its intended destination.
Towing and road-side assistance services are also part of this business activity. They provide essential services to motorists who experience mechanical breakdowns or accidents on the road, helping to ensure that they can get back on the road quickly and safely.
Finally, liquefaction of gas for transportation purposes is another service offered by businesses engaged in Service Activities Incidental to Land Transportation. This service involves the conversion of natural gas or other gases into a liquid form, making it easier to transport and store. This service is particularly useful for the transport of natural gas, which is often transported long distances by pipeline or tanker truck.
Exclusions
This business activity excludes cargo handling. Cargo handling refers to the loading and unloading of goods from a transportation vehicle, such as a ship or truck, and the movement of goods within a terminal or warehouse.
Third-party Approvals
No third party approvals are necessary for this business activity, but it must be conducted outside UAE.
5229 Other Transportation Support Activities
Other transportation support activities refer to a range of services that facilitate the smooth movement of goods and people across different transportation modes. One of the key areas of focus for these activities is the forwarding of freight, which involves the coordination and organisation of transport operations by rail, road, sea or air. This may include the grouping of individual consignments and the pickup and delivery of goods.
Logistics activities are another crucial aspect of other transportation support activities. This involves the planning, designing, and supporting of transportation, warehousing, and distribution operations to ensure that goods are moved efficiently and cost-effectively. The procurement and issuance of transport documents and waybills are also included in this category of services.
Customs agents play an important role in facilitating international trade by helping businesses comply with customs regulations and managing the movement of goods across borders. Other activities of sea-freight forwarders and air-cargo agents include organising shipments, handling documentation, and providing advice on shipping regulations and routes.
Brokerage services for ship and aircraft space are also included in this activity. These services involve the negotiation and arrangement of space on ships and aircraft for the transportation of goods.
Goods-handling operations such as temporary crating for the sole purpose of protecting goods during transit, uncrating, sampling, and weighing of goods are part of the activities under this category. Overall, other transportation support activities provide businesses with the necessary support to transport their goods safely and efficiently across different modes of transportation.
Exclusions
This business activity specifically excludes certain services, such as courier services, as they are considered a separate business activity. Courier services primarily focus on the delivery of parcels, documents, and other items on a time-sensitive basis.
Insurance services related to transportation are also excluded from this category of business activity. This includes insurance coverage for vehicles used in transportation, as well as cargo and other goods being transported.
Travel agencies are not included in this business activity as they are primarily focused on providing travel-related services to consumers. Travel agencies may provide transportation services, but this is not their primary focus.
Tour operators are not part of this business activity as they primarily operate tours, which may include transportation services as well as other components such as accommodations, meals, and activities.
Activities that assist tourists, such as translation services, information and guidance, and assistance with travel arrangements, are not part of Other transportation support activities.
Third-party Approvals
No third party approvals are required for this business activity.
ESR
To comply with the regulations of Meydan Free Zone and aid in the prevention of money laundering and terrorism financing, it is crucial that you submit your ESR on schedule and follow all rules. The submission of the Economic Substance Return is necessary within a year of the financial year’s conclusion. Companies with financial years starting on or after January 1st, 2019, for example, and ending on or before December 31st, 2019, must file a notification. Additionally, newly formed companies are required to submit their Economic Substance Return in the following year.
Business activities 5210.00, 5221.00 and 5229.00 do not need ESR.
AML
In order to fulfil their obligations under anti-money laundering and counter-terrorism financing laws, Designated Non-Financial Businesses and Professions must adhere to the Ministry of Economy’s requirements. Existing licensees have already registered for goAML following the completion of an awareness campaign that ended on April 30th, 2021. To avoid potential penalties, new licensees must comply with the requirements after obtaining their license.
Business activities 5210.00, 5221.00 and 5229.00 do not need AML.
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