Scrap Metal Business Dubai: 2022 Guide

tlz start a scrap metal business in Dubai, UAE

The United Arab Emirates is one of the fastest-growing economic hubs globally. Dubai is one of the biggest suppliers of ferrous scrap metals worldwide. This makes it easy for foreign investors and entrepreneurs to start a scrap metal business in Dubai.

There is a wide range of scrap metals, local and international markets, business activities, and more for you to consider when opening a scrap metal business in Dubai.

Let’s start right away. In this article, we’ll look into:

  • Benefits of starting a scrap metal business in Dubai
  • Cost of starting a scrap metal business in Dubai, UAE
  • Steps to start a scrap metal business in Dubai, UAE
  • Working with Trade License Zone

Benefits of starting a scrap metal business in Dubai

Scrap metal comes from a wide range of sources, including the industrial sector, manufacturing processes and surplus materials, household goods, construction waste, motor vehicles, mining, and foreign markets from as far afield as Asia, Africa, and Europe for local and international scrap markets.

Metals constitute a large proportion of landfill waste. Dealers and markets worldwide offer a constant stream of business. Scrap metals are bought and sold for recycling plants to transform them back into useable products – this is business as a force for good. A business can turn a profit while helping the environment as scrap metals can become a resource once again. Scrap metal recycling companies trade in copper wire scrap, stainless steel scrap, cast iron scrap, iron scrap, aluminium scrap, brass scrap, copper, and other ferrous metals.

Starting a scrap metal business in Dubai can be highly profitable. There are two main entry points to opening a scrap metal business:

  • Operate as a scrap metals dealer to resell to recycling plants
  • Collect and sell scrap metals to other scrap metal dealers around the world

We have already touched upon the key benefits of starting a scrap metal business in Dubai: profitability and recycling to meet environmental regulations. Recycling scrap metals into ore saves energy. For example, recycling a single aluminium product will save enough energy to power a light bulb for over four hours. That’s why the scrap and recycling industry plays such a globally significant role.

As if that wasn’t enough, recycling in an environmentally-friendly manner creates around 36 times more jobs than melting the metal and six times more than sending it to a landfill. Recycling scrap metals also reduces greenhouse gas emissions to meet international standards and consumes less energy than extracting metal from mines.

Cost of starting a scrap metal business in Dubai, UAE

The cost of starting a scrap metal business in Dubai is between AED 10,000 and AED 30,000. Calculating the exact cost of a scrap trading and scrap metal business license in Dubai is complex as the process varies depending on the location, activities, company structure, and more.

All businesses operating in the United Arab Emirates require a trading license. These licenses regulate scrap metal businesses and their industry, offering foreign investors and entrepreneurs with lots of benefits and support structures to grow their businesses. A valid trading license allows companies to work in Dubai and across the UAE, while others enable scrap metal business license holders to import and export to international markets.

As a foreign investor and entrepreneur, you might want to partner with a team of specialists to help you navigate the different license types, the costs, and more. If you’d like an accurate quote, contact Trade License Zone to help you.

Steps to start a scrap metal business in Dubai, UAE

All companies trading in the UAE need to adhere to specific regulations for business setup, structure, company naming, business activities, and more. This section will give you the steps to start a scrap metal business in Dubai.

Step 1: Partner with Trade License Zone

The first step in starting a scrap metal business in Dubai is to partner with Trade License Zone. We’ll manage all aspects of your company registration and setup process, and guide you on the various governmental and municipal trade regulations for an event management business in Dubai.

Step 2: Market research

Exhaustive market research is key to launching a successful scrap business in the UAE. Apart from identifying the business opportunities and competitors in this industry, market research will help pinpoint your scrap company’s role in the scrap dealers industry in Dubai, the UAE, and the Middle East in general.

It will help you to define the business activities your scrap company will offer in the license application:

  • Be a service provider such as a scrap metals collector
  • Import and export scrap for scrap trading
  • Offer services as a recycling company

Step 3: Choose the right location

A crucial step for your scrap metal business in Dubai is its location. Site location near your customers works to lower your transport costs and make your processes more efficient. Renting a warehouse or yard near your customers will make sourcing major categories of scrap metals easier. Your premises must also offer space for metal sorting, shipping containers, forklifts, and other such equipment.

Step 4: Apply for a trade license

As we have mentioned, all businesses must obtain a business license to trade in the UAE legally. Dubai has established business zones, each with regulations to support specific industries. The two major categories of business zones are Mainland Companies and Free Zone Companies. Each has benefits and differences. If you’re unsure which one is right for your business, consult with Trade License Zone‘s specialist teams.

Free Zone Companies give foreign investors and entrepreneurs 100% ownership of their business. You can select from are over 40 special trade zones in Dubai. These free zones offer unique benefits, such as startup incubation services, support systems, and more.

When you apply for your scrap metal trading license, you will need to fulfil the following requirements for the license application process:

  • Join the Scrap Metal Dealer Association in Dubai
  • Hold a Business Registration Certificate (which can be completed online with our help)
  • Hold a Tax Compliance Certificate
  • Hold a business premises rental agreement
  • Carry a business permit
  • Passport photos and details of all company directors and shareholders

Reach out to the professionals at Trade License Zone to help you with the entire application process. As soon as the Dubai Department of Economic Development has successfully granted your application, you will be free to start trading as a scrap metals dealer in Dubai.

Working with Trade License Zone

Business setup in the UAE is straightforward when you have partnered with a team of experts such as Trade License Zone. Starting a scrap metal business in Dubai can be a tricky process with applying for the trading license and company structure. When you partner with Trade License Zone, we will save you from unnecessary delays or rejections and streamline the entire process.

The experts at Trade License Zone can get started once you simply provide us with some basic documentation and a little information about the nature of your company and business activities. Then, please sit back and let our team take care of the rest. We’ll manage your scrap metal company license and visa applications, communicate with all relevant local departments and authorities and report back when you’re ready to trade. It really is that simple.

Contact us to get a personalized quotation based on your business activity