No need to drop when you shop as 'e-souqs' expand

Finding the best deal for an iPad or a pair of Christian Louboutin stilettos may become a little easier as cross-border internet shopping services arrive in the Gulf.

Souq.com and Nahel.com, two UAE-based e-commerce websites, aim to make their offerings available throughout the region this year. "We'd like to have Kuwaitis buy from Dubai without having to travel to their malls, and still having access to the same products," said Ronaldo Mouchawar, the founder and managing director of Souq.com.

The website is often referred to as the eBay of the Arab world. Owned by Jabbar Internet Group, it mainly provides an online auction service but has recently opened its platform to traditional retailers to sell their wares. It launched its website in Kuwait last week to add to its presence in Egypt, Saudi Arabia, the UAE and Jordan. "Our mission is to complete the GCC by the end of the year and to link up north Africa, Levant and the GCC region," Mr Mouchawar said.

"We want to tailor the user experience to be as local as possible with local payment gateways and couriers and then eventually linking all these markets together," he said. Saeid Hejazi, the managing director of Nahel.com, said the website had been working on expanding its offerings across the region for the past three months and aimed to launch the service by the end of the year. Mr Hejazi said the website would initially focus on the GCC region in phases but would not restrict its services to certain parts of the region.

"We're tapping into a larger market. We know that our services are in demand, not just in the UAE but in the rest of the Middle East," Mr Hejazi said. "Going regional is a completely different ball game, and for us we are separating completely from our domestic operations." Although cross-border online shopping is common in North America and Europe, it has yet to catch on in the Middle East. Logistics and customs requirements have prevented online retailers from expanding their offerings from their home country across the region.

"The region has a very heterogenous situation when it comes to custom taxes rates and regulations," said Jawad Abbassi, the founder and general manager of Arab Advisors Group. "Cross-border e-commerce will work best for software and music and other goods and services that do not need to be shipped through customs." Another issue retailers will have to watch out for is what items can be sold under the law in certain countries. "Items could be confiscated, and you could as a company become blacklisted," Mr Hejazi said.

"For example, video games are not allowed in certain markets, and customs officials may flag you and your products. You will not get banned, but it slows delivery times because all your products get checked." While Souq.com uses Aramex for sellers to ship their goods, Mr Mouchawar said the company was evaluating several new courier agencies in each Middle Eastern country to lower shipping costs to make cross-border shopping more attractive to buyers.

"We currently manage the logistics for the sellers," said Mr Mouchawar. "Hopefully we will have some certain solutions that will make it more attractive for the sellers to use our services and cost as low as possible."