Bread has become an essential food item in our grocery basket & its varieties have been integrated into various menus across the UAE.

The influx of tourism & existing ethnic diversity has led to demanding tastes in this category in recent years.  

Hence bakery manufacturers of various scales have taken up this challenge to cater to a wider range of exquisite products. Also, the pandemic & social media platforms have given people time to explore ways to express their creativity.

This has led to people baking for birthday parties & sharing their desserts at get-togethers, to owning a personal boutique that displays their creations.

As an entrepreneur who is thinking of opening a bakery or a boutique in Dubai, it is important to consider what type of niche market you’re planning to capture by keeping abreast of the latest buzz & vogue to generate repeat customers.

Even to manage a small-scale bakery business successfully, the finance & other budgetary aspects need to be sorted by installing a proper system.

A good Point Of Sale (POS) software can get you sorted for this type of activity as it tracks;

1. Labor
2. Equipment
3. Inventory cost & consumption
4. Shelf life of perishable products to ensure consumption before the expiry date
5. Handles orders seamlessly with third-party integrators like Talabat, Deliveroo, etc.

Government Guidelines

The UAE has issued New Food regulations, that any product that is not registered with ECAS (Emirates Conformity Assessment System) is not allowed to be sold in the marketplace.

It should be kept in mind that running a baking business (or any kind of business) from home is illegal in the UAE.

And if you still wish to sell your products, you can be a part of a Bake Sale hosted by ArtE Makers’ Markets hosted all over the country, as these types of markets own Trade Licenses that cover all the vendors.

If you are an individual who promotes or sells products and services through your social media accounts or a personal website, then you’ll need an E-trader license in Dubai.

Home entrepreneurs who don’t require physical office space or a local partner are eligible to apply for the E-trade license in Dubai, as it does not require you to register for an Ejari. 

Food products are strictly not allowed under e-trading license to any nationality, except Emiratis based in Dubai and over the age of 21 years.

Therefore like any other business, a bakery requires two legal licenses;

• First Food Safety License from Dubai Municipality Food Safety Department, and
• Second Trade License from the Dubai Department of Economic Development (DED).

Only the trade license requires a mandated fee by the UAE government to get the pan baking.

The food safety license has no fee involved, if the documents are intact the Municipality approves it in a day.

1. Area Requirements, Cost & Location

A. Area Requirements: for a Bakery

• the Kitchen area should be a minimum of 250 sq. ft
• the oven area should be a minimum of 80 sq. ft

Scout a location based on the kind of audience you wish to cater to. Keep in mind the following;

B. Type of bakery depending on your target customers:

• Counter service         — only takeaway with a showroom
• Bakery café                — a sit-out for office goers
• Bakery food trucks   — sell their products to the general public from a mobile truck
• Wholesale bakeries  — supplying groceries, supermarkets, restaurants & cafes
• Specialty bakeries    — gluten-free items , birthday & other event planning
• All of the above

C. Visibility & Accessibility: Depending upon your business model you must decide

• whether Parking space is required for customers or only employees
• how you will reach your suppliers and customers

2. Name Reservation, Company structure & Activity Registration (Initial Approval)

Reserve a trade name/ brand name and get the activity/activities sanctioned by the Dubai Development of Economic Department (DED).

This step is the Initial Approval stage, which will allow you to move forward in renting a space and gaining the necessary permits with Dubai Municipality Food Safety Department.

Also at this stage, you need to choose the bakery structure. There are three types of company structures that you can choose for your bakery:

1. Limited Liability Company (LLC): provides limited liability protection, however, you need to have a local partner holding 51% shares for this type of company.

• Sole Establishment (if one owner): does not provide limited liability protection for their shareholders.  

• Civil Company (if more than one owner): does not provide limited liability protection for their shareholders.  

All of the above options here can be fully owned by foreigners without a local partner, however, it is required to appoint a local service agent.

Apart from these, the bakery is also required to obtain the following permits and licenses depending on the list of activities it wishes to perform:

• Vehicle permit for transporting or delivering food products
• Pork permit for handling and serving pork products

Ramadan permit (food outlets are allowed to maintain their operations during the holy month of Ramadan and provide non-fasting individuals with places to eat and drink)

3. Business Partner and Shareholder Agreement

If there is more than one partner in your bakery ownership, you must legitimize the partnership between you and your Business Partner/Friend by signing an agreement at the Notary Public court.

The agreement is called a Memorandum of Association or Partnership Agreement depending on the legal form you choose. If you choose LLC, then MOA would be signed, alternatively if you choose Civil Company, then Partnership Agreement is the correct document.

4. Ejari and Plan Layout

Ejari means ‘My Rent’ in Arabic, which stands for the official tenancy contract between your business and the landlord who provides the space for your bakery. Renting space and having an Ejari certificate is one of the requirements for a bakery set up in Dubai. Bear in mind that the premises need to comply with certain standards.

The layout provides a blueprint for smooth operations which must include;

• Oven and other supportive equipment areas (Planetary Mixers, Deep Freezer, Chiller, Working tables, Gas stove, Cylinders)
• Exhaust hoods & smoke removal outlets
• Double sink for utensils washing area & Handwash stations
• Food storage areas, Utensils storage area & Locker rooms
• Windows & ventilation system
• Entry & exit passages
• Dining hall, Washrooms & Toilets

Collect the Ejari and Plan layout from the landlord, in case it is ready to move in bakery. If the place you have chosen is ready to move in, but the kitchen is not ready then you must hire an Interior design company to obtain the layout. Or if the location is not ready to move in at all and is still under construction you must get the plans from the Building Contractor and hire an Interior design company to draw the kitchen layout for you.

Make sure to hire someone who has done similar work earlier so that they can help you with the Municipality approval as well.

To double-check if the requirements have been met, it is best after the initial approval you approach the Building Permit Department under the Dubai Municipality to find out the basic requirements. For food establishments like bakeries, restaurants & cafés it is mandatory by the Sewage and Irrigation Management Authority to include grease traps in the drainage pipes.

For food establishments like bakeries, restaurants & cafés it is mandatory by the Sewage and Irrigation Management Authority to include grease traps in the drainage pipes.

5. Municipality Approval:

The next step is to get approval from Dubai Municipality by producing the following documents;

1. Initial Approval from DED
2. Plan Layout
3. Ejari

Upon completion of the requirements, the Food & Safety Authority of Dubai Municipality will view the above documents and issue the approval certificate.

If there are any changes required in the kitchen layout the Municipality will suggest them, review the changes, and then issue the approval certificate.

6. Trade License

Once you get the approval from the municipality, submit all the above signed and attested documents again to the DED to obtain your Trade License.

7. Operations

You can begin bakery operations after this. A Municipality Inspector will come over to your establishment to verify your legal documents and check whether the layout & equipment are in place as per the approved layout and give you suggestions accordingly.

How CorpLex can help you?

So, there’s a lot to do, and you can expect some challenges along the way. It’s frustrating for any business owner to see their hard work sink into a pile of paperwork and vanish.

By seeking professional advice and investing time to set up your business properly, you have a better chance of running an effective and profitable bakery.

Contact our company formation experts at CorpLex and we can help you to establish your company on your behalf, make your license, visa applications and take care of all the necessary administration, leaving you free to focus on other aspects which require your attention. We also offer assistance with visa and immigration services and can handle all government formalities, permissions, work permits, and visas applications that are required to trade in the UAE.