Logistics & warehousing
How to start a courier or last-mile delivery company in the UAE
Domestic courier and last-mile delivery is a mainland transport activity requiring emirate transport authority approval, vehicle permits and driver licensing.
The market
What the sector actually looks like.
Last-mile demand is driven by an e-commerce market heading toward USD 21bn by 2031 and by food delivery, which is forecast to pass USD 2.8bn in 2026 with around 5.5 million active users. The volume is real; the margin is contested.
Figures on this page
UAE e-commerce market around USD 12.3bn in 2026, forecast USD 21bn by 2031 (11.3% CAGR). Digital wallets held about 44% of payment share in 2025; smartphones carried roughly 79% of transaction volume; fashion led categories at about 22% share while food and beverage is forecast to grow fastest at around 13% CAGR.
Mordor Intelligence and market aggregates, 2025–26
How the business actually makes money
Cost per drop against price per drop, and the gap is small. Rider productivity — drops per hour — is the only meaningful lever, and it is determined by route density. Serving a concentrated area profitably is achievable; serving a wide area is not. Rider cost including visa, accommodation, vehicle and insurance is the dominant line, and it is fixed while volume is not.
Why here
Regional advantages
Structural e-commerce and food delivery growth
Both underlying markets are growing at double digits. Volume is not the problem.
High urban density
Route density in Dubai and Sharjah residential clusters supports genuinely efficient last-mile operations.
Customer expectation of speed
Willingness to pay for same-day and next-day is established, which supports premium tiers.
And the other side
Regional disadvantages
Rider cost is the whole business
Visa, accommodation, vehicle, insurance and salary per rider is a heavy fixed cost that volume must cover.
Aggregators compress prices
Large platforms with scale set the market rate and independents must match it.
Employment compliance is scrutinised
Rider employment arrangements are closely examined. Freelance permits and third-party visas are not a lawful workaround.
Why this is different
Not just logistics & warehousing.
Rider and driver employment is the operational core and the compliance risk — visa sponsorship, WPS, working hours and vehicle permits are all inspected.
Approvals beyond the trade licence
Mainland trade licence, transport authority permits for vehicles and riders, driver licensing, and insurance appropriate to commercial delivery.
Where to license it
The logistics & warehousing activity in full · The general setup guide
Questions
A mainland trade licence with transport authority permits for vehicles and riders, driver licensing and commercial delivery insurance. It is a mainland activity.
No. Rider employment arrangements are closely scrutinised and the penalties for improper arrangements fall on the operator.
Only with route density. Cost per drop against price per drop is a narrow gap, and serving a concentrated area is the difference between profit and loss.
One question
Who will be paying your invoices?
The clearest free zone case there is. Cross-border e-commerce with no UAE delivery leg qualifies comfortably, and a virtual office satisfies the premises requirement — one of the few activities where that is both permitted and sensible.
Compare the two routesOr just ask usShipping goods to customers inside the UAE is domestic trade whatever the platform says, and marketplaces now verify the licence behind the seller account. That points to mainland, or a mainland distributor handling the last leg.
Compare the two routesOr just ask usThis one forces itself early. Marketplace fulfilment inside the UAE counts as domestic supply, so a business selling both ways usually needs the mainland route sooner than the plan assumed.
Answer five questions insteadOr just ask us