Vending machines may not seem like an obvious choice for budding entrepreneurs anywhere in the world, let alone in the Middle East. Yet, the global vending machine market is expected to reach $25.25 billion by 2027. That’s an impressive 6.7% growth in a world where a “nice” CAGR is around 5%.
Our point? If you are looking for a business idea with low startup costs and high potential profits, then starting a vending machine business in Dubai may be the right choice for you.
There are many benefits to vending machines as a business model. The region boasts a stable economy, high tourist foot traffic, and a thriving nightlife scene. With a little research and planning, you can find the perfect location for your vending machine business and start reaping the rewards.
This article explores what to know about the relevant business licenses, visas, and everything else you need to get your vending machine business up and running.
How Profitable Are Vending Machines?
Actually, let’s take a step back first. What are vending machines?
Vending machines are automated machines that provide items such as snacks, drinks, cigarettes, and lottery tickets to consumers after the customer inserts currency or credit into the machine.
So, how profitable is a vending machine business? A single vending machine can generate anywhere from USD $30-$60 a week in profit. However, in high-traffic areas, a vending machine can earn you up to about $400 a month.
While most of the statistics out there are for American entrepreneurs with vending machines in the United States, similar numbers can be found for vending machines in places like Europe and the UAE.
As you can imagine, if you own multiple vending machines, your profits will increase exponentially. For entrepreneurs, it could quickly become the start of something huge.
The most essential factor in determining the profitability of your vending machine is the location. You will want to place your vending machines in highly trafficked areas such as malls, subway stations, and office buildings.
Another factor to consider is the type of product you sell. Drinks, coffee and snacks are the most popular items purchased by consumers from vending machines. In fact, coffee machines do very well in this market on their own! Stocking your machine with these items is a good idea and a great way to generate high profits rapidly.
Overall, vending machines can be quite lucrative if you take the time to choose the right locations and stock your machines with popular items. Outside of that, though, there are numerous benefits of starting this type of business…
Benefits of Starting a Vending Machine Business in Dubai
There are many reasons why you might want to consider starting a vending machine business in Dubai.
For one, there is a large population of expats living here, who are always on the lookout for convenient places to buy snacks and drinks. This is particularly true if you’re able to place your vending machines near where the expats live and work.
In addition, vending machines can be placed in high-traffic areas such as shopping malls and office buildings, making them an excellent source of passive income. The city also has a modern infrastructure, which makes it easy to set up and maintain one or many vending machines.
Whether it’s the simplicity of coffee machines, cold drinks, gourmet snacks or sweet treats – vending machines are proving to be an exciting and worthwhile venture!
Furthermore, there is no tax on profits earned from vending machine businesses in Dubai.
And lastly, Dubai is home to many international events and conferences, which provide ample opportunities for vendor operators to generate sales. So if you’re looking for a business model with high potential, starting a vending machine business here is definitely worth considering.
What Visa Do You Need to Start a Vending Machine Business in Dubai?
Yes, you will need a visa to live and work in Dubai. There are a few different types of visas that you can use to start your own vending machine business.
The first option is to get a business visa, which will allow you to set up your business and operate it for a period of time. This type of visa usually requires that you have a physical office space, as well as a certain amount of capital to invest in your business.
The best part about getting a business visa in Dubai is that you can register your vending machines in a free zone. There are more than 40 free zones in the UAE. Setting your business up in one of them means you’re exempt from taxes.
Another route to take would be to start off with just a regular UAE residence visa, which will allow you to live and work in Dubai on a more permanent basis.
This type of visa usually requires that you have a job offer from a UAE company, and you will need to meet certain financial requirements.
While we’d recommend the business visa, if you’d like to move to Dubai with another job and then start your vending machine business on the side, a residence visa might make sense.
Ultimately, if you think this business idea is right for you, the best way to find out which visa you’ll need is to consult with an experienced business specialist!
Step-by-Step Guide: How to Start a Vending Machine Business in Dubai
If you’re thinking of starting a vending machine business in Dubai, here’s a step-by-step guide to help you get started.
Partner With Virtuzone
First, you’re going to want to partner with the best business solutions specialist in the UAE! Virtuzone is the leading company formation specialist in the UAE.
We make it simple and straightforward to set up your business in Dubai. We’ll help you choose the right business license, find the perfect office space, and open a corporate bank account.
And we’ll be there to support you every step of the way. Partnering with Virtuzone is the first step to starting your vending machine business.
We can help you:
- Understand how to register your business
- Help you get your business license
- Apply for your visa
And more! Whoever you work with, the point is that it’s helpful to work with a trusted partner who knows all about UAE laws.
Choose Your Trade Name
The next step is to choose a trading name for your company.
This is the name that will appear on your business license and all of your marketing materials, so it’s important to choose something that’s memorable and reflects the type of business you’re in.
Not sure how to choose the right name? We can help, but here are some general tips..
First, keep it simple. A trade name should be easy to pronounce and spell, so avoid using complex or unfamiliar words.
However, make sure to make it unique. There are thousands of businesses operating here, so it is important to choose a trading name that sets you apart from the competition.
Additionally, make sure it represents your brand well. Your trade name should be reflective of the products or services that you offer, so take some time to brainstorm potential names that capture the essence of your business.
Finally, conduct a trademark search. Before finalizing your trade name, be sure to conduct a trademark search to ensure that it is not already in use by another business. However, again, a specialist can likely do this for you.
Apply for Approval from the DED
Once you’ve chosen a trading name, you’ll need to register it with the Dubai Department of Economic Development.
The DED licenses all businesses in Dubai, and they will need to approve your vending machine business before you can start operating.
To apply for a license, you will need to submit an application form, which you can get from the DED website (we have linked that above for you). You will also need to provide some supporting documents, including your business plan and a copy of your passport.
Once your application has been received, the DED will review it and decide whether or not to issue you a license. If you are approved, you will be issued a license that is valid for one year. After that, you will need to renew your license every year.
Choose the Company’s Legal Structure
When setting up a vending machine business in Dubai, you will have to choose the legal structure for your company. The most common types of business structures in the UAE are sole proprietorships, limited liability companies (LLCs), and civil companies.
Each type of company has its own benefits and drawbacks, so it is important to choose the one that is best suited for your business.
For example, LLCs offer limited liability protection for the owners, which means that they are not personally responsible for the debts of the company. This can be a significant advantage if your business is high-risk or if you are planning on expanding your operations in the future.
Civil companies, on the other hand, are owned by a single shareholder and are not required to have a board of directors. This makes them simpler to set up and run, but they may not be the best choice if you are looking for long-term growth potential.
Once you have decided on the legal structure for your company, you will need to register it with the correct department in Dubai.
Apply for Your Business License
Now, it’s time to obtain a business license. This can be done by visiting the Dubai Department of Economic Development’s website and submitting an online application.
Once your application has been approved, you will be issued a business license which will allow you to operate legally in Dubai. In addition to applying for a business license, you will also need to obtain a trade license from the Dubai Chamber of Commerce and Industry.
This can be done by filling out an online application and paying the required fees.
And (finally), you will also need to obtain a permit from the municipality in order to place your vending machines in public areas. These permits are typically valid for one year and can be renewed on an annual basis.
Once you have obtained your trade license, you will be able to start trading! But, you’re not done just yet…
Apply for Your Visa
As mentioned above, you will need a visa to live and work in Dubai. However, applying for a visa to start your own business in Dubai is a relatively simple process.
First, you’ll need to submit an online application through the Dubai eVisa portal. Next, you’ll need to provide supporting documents, including a business plan and proof of financial stability.
Once your application is reviewed and approved, you’ll be issued a visa that will allow you to live, work, and operate your vending machine business.
Advantages and Disadvantages of Vending Machine Business in the UAE
Does the process of setting up a vending machine business in Dubai sound attractive to you? It certainly is for most entrepreneurs.
We understand why!
The UAE is a rapidly developing country with a large and increasingly affluent population. The vending machine business has grown in popularity in recent years, as it offers a convenient way for people to purchase snacks and drinks on the go.
However, there are both advantages and disadvantages to starting a vending machine business in the UAE.
One of the biggest advantages of the vending machine business is that it can be quite profitable. The initial investment is relatively low, and the machines can generate a significant income, particularly in high-traffic areas.
Additionally, vending machines require very little maintenance and can be left unattended for long periods of time.
However, there are also some drawbacks to consider.
The most obvious drawback is that the UAE is a very competitive market, and there are already many established vending machine businesses operating in the country. This means that it can be difficult to break into the market and find locations for your machines.
Additionally, because the machines are unattended, they are vulnerable to theft and vandalism. As a result, it is important to carefully consider the risks before starting a vending machine business in the UAE.
Choose the Right Business Setup Services in Dubai
If you’re thinking of starting a vending machine business in Dubai, it’s important to choose the right business setup services.
Here at Virtuzone, we can help you every step of the way. We have years of experience setting up businesses all over the city and know what it takes to make your venture a success.