How to Start a Toy Business in Dubai?

How to Start a Toy Business in Dubai – Complete 2025 Guide

Dubai has become a global hub for entrepreneurs, and the toy industry is no exception. With a diverse population, a booming retail sector, and high demand for children's products, starting a toy business in Dubai is a profitable opportunity for local and international investors. Whether you want to set up a toy trading company, open a retail shop, or explore e-commerce opportunities, Dubai offers the right environment. This guide provides a complete, step-by-step explanation of how to start a toy business in Dubai, covering licensing, legal requirements, costs, market potential, and compliance with UAE laws.

Why Start a Toy Business in Dubai?

Dubai’s toy market is expanding rapidly due to its large expatriate population, high purchasing power, and strong tourism industry. The demand for toys is fueled by families, schools, nurseries, and the hospitality sector. Moreover, with Dubai hosting several international trade fairs and exhibitions, toy businesses can access global supply chains with ease.

Key reasons why Dubai is ideal for toy businesses:

• Growing population of families and children in Dubai and the wider UAE.
• High spending capacity on children’s products and luxury toys.
• 100% foreign ownership allowed for trading companies (as per Cabinet Resolution No. 16 of 2020).
• Zero personal income tax and only 9% corporate tax above AED 375,000 (Federal Decree-Law No. 47 of 2022).
• Access to international suppliers via Jebel Ali Port and Dubai International Airport.
• Retail and e-commerce growth across the UAE.

Business Models for the Toy Business in Dubai

There are multiple ways to start a toy business in Dubai depending on your goals and investment size:

1. Toy Retail Shop: Open a physical store in malls, markets, or standalone outlets.
 

2. Toy Trading Company: Import, distribute, and wholesale toys across Dubai and UAE.
 

3. E-commerce Toy Store: Sell toys online via your website or marketplaces like Noon and Amazon UAE.
 

4. Toy Franchise Business: Partner with international toy brands and open licensed stores.
 

5. Educational & Speciality Toys: Focus on eco-friendly, STEM, or Montessori toys.

Step-by-Step Guide to Starting a Toy Business in Dubai

Step 1: Choose Your Business Activity: Select toy trading, retail, wholesale, or e-commerce as your main activity.

Step 2: Select Jurisdiction: Mainland (DED license) allows direct retail in UAE, while Free Zones (like IFZA, DMCC, or RAKEZ) allow international trading and e-commerce.

Step 3: Reserve Your Trade Name: Register a unique business name with DED or the Free Zone authority.

Step 4: Get Initial Approval: Submit shareholder documents and proposed activity for pre-approval.

Step 5: Secure Retail/Office Space: Lease a shop or office space if required by DED or Free Zone regulations.

Step 6: Apply for Toy Trading License: Submit application to DED (for Mainland) or Free Zone authority.

Step 7: Product Safety Approvals: Toys imported into Dubai must comply with Emirates Authority for Standardization & Metrology (ESMA) guidelines.

Step 8: Apply for Visas: Investor and employee visas under your company license.

Step 9: Open a Corporate Bank Account: Required for transactions and international trading.

Step 10: Register for VAT: Mandatory if turnover exceeds AED 375,000 annually (Federal Decree-Law No. 8 of 2017).

Legal & Regulatory Compliance for Toy Business in Dubai

All toy businesses in Dubai must adhere to UAE laws and consumer protection guidelines. Key regulations include:

• ESMA Regulations: Toys must meet UAE safety standards under the Emirates Conformity Assessment Scheme (ECAS).
• DED Licensing: All toy shops and trading companies require a valid commercial license from DED (Mainland).
• Free Zone Laws: Companies in Free Zones must comply with authority-specific regulations.
• Corporate Tax Law: 9% corporate tax applies on profits exceeding AED 375,000 (Federal Decree-Law No. 47 of 2022).
• VAT Compliance: 5% VAT applies to toys sold in the UAE (Federal Decree-Law No. 8 of 2017).
• Customs & Import Regulations: Toys imported must comply with UAE Customs codes and approvals.

Cost of Starting a Toy Business in Dubai

The cost of setting up a toy business in Dubai depends on the jurisdiction, business size, and activities. Mainland setup costs include trade license, retail space rent, and government approvals. Free Zone setup is generally more cost-effective and offers simplified processes. Entrepreneurs should budget for licensing fees, office/shop rent, visa costs, and initial product imports.

Benefits of Starting a Toy Business in Dubai

•  Access to one of the wealthiest consumer markets in the Middle East.
• High demand for quality and branded toys.
• Opportunities in both retail and e-commerce sectors.
• Strategic location for imports and exports.
• Business-friendly environment with strong legal protections.
• Full repatriation of profits and capital to India or home country.

Why Choose Flyingcolour Business Setup?

Flyingcolour Business Setup has more than 20 years of experience in helping entrepreneurs establish businesses in Dubai. We assist with every stage of the toy business setup, from trade license registration and ESMA approvals to corporate bank account opening and visa processing.

Our services include:

• Free consultation for UAE business setup
• Assistance with toy trading license applications
• ESMA and customs compliance guidance
• Office and retail space leasing assistance
• Visa and Emirates ID processing
• Tax registration and compliance support

FAQs – Toy Business Setup in Dubai

1. Do I need ESMA approval for toys in Dubai? 

Yes, all toys must comply with ESMA standards for safety.

2. Can I open a toy shop in a Free Zone? 

Free Zones are better suited for wholesale and e-commerce; Mainland licenses allow retail shops in the UAE.

3. How long does it take to get a toy trading license?

Typically 2–4 weeks, depending on documentation and approvals.

4.What is the minimum investment to start a toy business? 

Costs vary based on jurisdiction and shop size; consult Flyingcolour for estimates.

5.Can foreign investors own 100% of a toy business in Dubai?

Yes, 100% ownership is allowed under UAE laws.

Therefore, to learn more about how to start a toy business in Dubai, Book a free consultation with one of the Flyingcolour Business Setup team advisors.

The article was published on 20/08/2025. It is important to note that the federal policies and updates mentioned may have changed since then. For the most current information, please contact our consultant!