Dubai start-up Shorages secures $700,000 in new funding to fuel expansion

Shorages, a Dubai-based e-commerce fulfillment start-up, raised $700,000 in a seed funding round that it will use to build more warehouses in the UAE and increase hiring.

The financing, led by London-based Mayfair Holdings along with a number of other angel investors and serial entrepreneurs, aims to help global brands expand their presence in the GCC market, the company said in a statement on Wednesday.

It is “time-consuming and costly for direct-to-consumer brands to set up a local operation”, said Rayan Osseiran, chief executive of Shorages, adding that the company plans to build fulfillment and distribution services needed for a “quick and cost-effective springboard into the market”.

The delivery and logistics market in the UAE has grown significantly over the past few years, buoyed by the rapid expansion of online shopping, which was accelerated by the Covid-19 pandemic.

The UAE freight and logistics market is projected to reach $31.41 billion in 2026, from $19.65bn in 2020, driven by the consistent growth of e-commerce across the region as well as rising international trade, Mordor Intelligence data showed.

Meanwhile, the country’s e-commerce retail market surged 53 percent annually to hit a record $3.9bn in 2020, accounting for 8 percent of the overall retail market, according to the Dubai Chamber of Commerce and Industry. E-commerce licenses issued by the emirate jumped 63 percent in the first half of 2021, the Department of Economic Development said.

Shorages is also working on a free-zone warehousing solution that would reduce the cost of shipping for their brands, it said, adding that it is looking to expand its developer team to boost its order fulfillment and inventory management systems.

The start-up’s storefront integration services are offered across several brands, including Amazon, Noon, eBay, and Square Space, according to its website.