How to Start a Scrap Metal Business in Dubai

Scrap Business Dubai UAE
How to start scrap business in Dubai UAE
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The United Arab Emirates provides ground for different types of business opportunities. Thus, it is easy to start any type of business in UAE provided you’re financially stable and have the skills to do thorough market research before launching your business. Similarly, the UAE is among the top-tier suppliers of ferrous scrap globally. Therefore, this makes it easy for investors to start a scrap metal business in Dubai effortlessly.

If you are longing to start a scrap metal business in Dubai, here are the steps to consider before launching your scrap metal business fully.

  • Research and conduct scrap metal analysis
  • Locate a place for your scrap business
  • Apply for scrap metal business license in UAE
  • Perform your business activities

Market analysis is one of the top-notch practices you’d want to engage in before settling on your scrap metal business in Dubai. There is stiff competition for scarp business in the Dubai marketplace because they are among the top suppliers in the world. That means; a lot of investors are investing in the scarps metal business in UAE as the source of income.

On top of that, the (BMRA) popularly known as the British Metal Recycling Association suggested that nearly 400 million metals are usually recycled every year worldwide. This perpetually motivates business investors in the scrap metal field to expand their business across the country.

Generally, scrap metal can be obtained from automobiles, manufacturing, household good, and foreign markets. So, when African countries export their commodities in UAE, they’re normally sold as scraps to the other countries globally.

So, before we discuss how to start a scrap metal business in UAE, we’ve documented some of the frequently asked questions about scarp mental that might be beneficial in your scrap business journey.

Let’s get started;

  • What is scrap trading?
  • How do scrap yards make money?
  • How to start a scrap business in Dubai

What is scrap trading?

Often, tons of individuals usually engage in scrap trading business but don’t know essentially what the whole business entails. Is it just buying and selling metals? Let’s find out;

Scrap trading is a business where the owner makes a reasonable amount of profit by selling the commodities to huge companies where they are recycled into useful products. Generally, this is a business where the business owner enjoys profits and at the same time conserves the environment.

When these goods are recycled, a lot of energy and resources are adversely saved. Additionally, recycling scrap metals is a way of cleaning the environment. Therefore, you can approach the scrap trading business in the following ways;

  • Have a buying station and transfer scrap metals to recyclers
  • Or, have your own warehouse

You can opt both ways and start making huge amounts of money in your scrap business. If you want to know how to scrap business make money, continue reading;

How do scrap yards make money?

We did in-depth research in different Q&A forums including Quora to find out how scrap yards make money. We collected beautiful insights and comments from those who majorly ventured into the scrap business some years back.

Below are the comments from the scrap business owners who shared their thoughts on Quora on how the scrap metal business makes money.

“Scrap yards are basically playing the stock market. Scrap prices can go up and down drastically every day. Depending on the size of the scrapyard, smaller ones sell to bigger ones who then sell it to China or India where it is recycled. The larger scrap yards will hang on to their metal if the prices are down and wait until the prices go back up before they sell. They can make a lot of money if they time it right. On that note, they can lose a lot of money too if they wait too long. I was hauling scrap metal when the economy crashed in 2008, just prior to the crash I was getting paid over $300 a ton for scrap metal.” – By Caroline Reison

Generally, the small scrap yards sell their metals to larger yards who later sell their goods to countries like China and India where the scraps are recycled into useful products again. It is a no-brainer process that doesn’t involve lots of processes to earn your money as a scrap business owner.

So, here are the plain steps that will guide you on how to jumpstart your scrap business in Dubai>

How to start a scrap business in Dubai

Like other businesses, there are steps one has to take to launch a successful business in Dubai. So, adhere to the following pointers if you want to make a successful scrap business in Dubai;

Research and conduct scrap market metal analysis

Research is always the hallmark of a successful business. Meaning, research will help you identify your competitors in the market, identify their business gaps and attempt to come up with solid strategies to outshine them.

And, so, in scrap metal business, the first step to take is to identify the role you’ll take in the scrap business. For instance, you can choose the following role depending on your preference and choice.

  • Collect scrap and sell them to China or India
  • Import the scrap and then sell it in your local area
  • Do you want to process the scrap materials

The decision will solely depend on you after conducting your market analysis concerning the above models you want to take in your scrap metal business.

Locate a place for your scrap business

Finding the perfect business space for any business is one of the main factors each investor needs to consider before starting a scrap business in the UAE. A business location usually acts as a selling point as well. If in any case, you locate your business where there are a few buyers, you won’t expect a huge return on investment due to slow business growth.

On the other hand, the cost of your business setup might also be affected by a combination of factors including site location. Thus, in case you are leasing a yard or warehouse, annual rent will be the first thing to strike your mind.

Additionally, other things such as metal sorting, shipping containers, forklift, bins, and other important sorting equipment might be needed in the yard.

Apply for scrap metal business license in UAE

You cannot conduct any business in UAE without a business trading license. A license gives your clients and dealers trust that you are authentic in the Dubai marketplace. And, so, you’ll be compelled to look for a business license in UAE for you to run your scrap metal business.

Therefore, in case you apply for a free zone trading license, your business will be bounded to certain numbers of companies in the UAE that are dealing with waste.  And your target is to follow all the preventive, environmental, and capital regulations that are relevant to your business.

In case you are applying for a local business license, you can get it through the Dubai Department of Economic Development. However, this may need a local sponsor who will benefit some fifty-one percent of the company shares.

You can always seek help from a professional consultant in Dubai to help you with the entire process of the license application in the UAE.

Perform your business activities

Once you’ve settled all the processes including license application. You are now free to start your scrap metal business in Dubai. So, ensure you have a skilled advisor who will help you scale your business journey in the scrap field.

Take advantage of the Dubai business environment and perform your business eyeing to achieve a huge return on investment and be ahead of your competitors.

Final Thoughts

Scrap metal business is one of the most lucrative business you can start in Dubai to make all end meets. However, with poor strategies, your business won’t thrive at all. You can seek help from an expert business setup consultant in Dubai.

Additionally, to start a scrap business in Dubai you’ll be required to research and conduct scrap market metal analysis, locate a place for your scrap business, obtain a trading license, and boom, carry your scrap metal business in Dubai to a higher level.


Get in touch with us Today and find out how Dubai Business Setup can help you setup your business as quickly and hassle-free.

Helpful Resources

How to Start a Recycling Business in Dubai- A Step-by-Step GuideCheck out this cool helpful resource if you start a successful recycling business in UAE, I recommend you to check here a few steps you need to comply with in your business journey.

Where is The Scrap Market in Dubai-Best Scrap Dealers in the UAE In this article,  we’ve compiled a list of the best scrap dealers in Dubai with better scrap metal rates and offers. You NEED to CHECK it before starting scrap business in the UAE.