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COVID-19 Impact on E-Commerce in UAE
Ahmad Ghandour
College of Business
Al Ain University
Abu Dhabi, UAE
ahmad.ghandour@aau.ac.ae
Abstract— This research paper will attempt to assess the
impact the coronavirus has had on the E-Commerce industry
of the UAE. Previous literature has been reviewed to
understand the scope of E-Commerce previously present in the
UAE before the onset of the new novel coronavirus. Two time
periods have been included in the regression analysis to
develop a better perceptive of the E-Commerce industry
before and after the spread of the infectious disease. Through
our study, we were able to conclude a significant positive
relationship in both periods. Coronavirus has positively
affected the E-Commerce industry as more retailers and
consumers have shifted onto online channels for their buying
and selling activities. The latter part of this paper includes a
discussion and special recommendation section to underline
the current situation and how it can be improved.
Keywords: E-Commerce, COVID-19, Pandemic, UAE
I. INTRODUCTION
The UAE was one of the top-performing economies
globally before the sudden outbreak of the new novel
coronavirus in Wuhan during December 2019. In the past
few decades, most of the emirates were busy shifting their
economy from oil onto more sustainable developmental
sectors such as tourism and domestic mass production.
However, the global economy, including the UAE,
witnessed a sharp drop-in economic activity due to newly
implemented sanctions and regulations because of the
pandemic. Economies had to shut down primary operations
and businesses to contain the outbreak of the infectious
disease. Nonetheless, the UAE has shown an immense
innovative capacity to combat the financial crisis effectively
in a recessionary period. Digitalization was already
becoming an emerging trend in the UAE, the onset of
COVID-19 acted as a catalyst and accelerated the call to
action. E-Commerce became popular due to the need to do
transaction during lockdown [1]. As the international trade
dynamics change, economies will be heavily impacted due
to coronavirus. It is essential that we forecast the scope of
the E-Commerce industry early on to prevent a financial
collapse of our institutions.
The remainder of the paper is organized as follows.
Section II presents the related works. Section III describes
the methodology followed by discussion and conclusion.
II. RELATED WORK
E-Commerce is the process of buying and selling
digitally through the use of online websites and platforms.
The transactions take place in one of two ways; money is
digitally transferred from one account to the other in the form
of secure data, or the retailer provides services or goods.
Both retailers and buyers prefer E-Commerce for several
reasons such as low operational costs for setup, a large
variety of products are available often at better qualities, it is
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Brendon J. Woodford
Department of Information Science
University of Otago
Dunedin, New Zealand
brendon.woodford@otago.ac.nz
straightforward to manage an E-Commerce website or
application as a retailer, and there are no time constraints
which allows consumers to purchase products whenever they
want.
However, specific sectors of the economy cannot
digitalize their operations as their consumer base prefers a
more hands-on experience while purchasing their products.
Examples of these sectors are healthcare, automobile,
education, and a variety of services. For these reasons, there
are some technical and non-technical disadvantages of E-
Commerce.
Leading experts and economists claim while E-
Commerce may not be able to account for the loss in
economic activity, it would surely help a stable economy as
the UAE would be able to reinstate itself internationally.
Consequently, a large number of businesses and small scale
firms digitalized their entire networks to meet the increase in
electronic consumer demand. The process has not been an
easy one for the economy. Whole supply chain networks and
operations have had to be digitalized to make the process of
buying and selling profitable and straightforward. The
primary trend observed in most countries is that most of the
economic activity has shifted inwards. As we can recall,
almost every country in the world had to close its border to
prevent corona ridden patients from causing more harm to
their economy. Emirates such as Dubai and Abu Dhabi were
highly dependent on tourism for their annual revenue.
Therefore, it is clear to comprehend why precisely the flow
of financial activity has turned inwards.
It is estimated that there are nearly 110 million internet
users of which 30 million use E-Commerce services in the
Middle East [2]. Moreover [2] also estimated that nearly $3
million are spent per day by mobile users on E-Commerce
platforms in the UAE. The number is anticipated to reach an
all-time high of $500 million per day in the coming future.
Moreover, in 2012, nearly 10% of all E-Commerce
purchases were made on mobile devices, and the remaining
90% through tabs and laptops. However, in 2015 the mobile
purchases increased by three times. Nonetheless, the UAE
E-Commerce industry has recently grown by an enormous
with internet to the large-scale market. Consumers spend
over $3 billion for online businesses [3]. That allows us to
conclude that the scope of the E-Commerce industry in UAE
before the pandemic was already initiated and developing.
Similarly, in 2012, people made purchases totalling $9
billion on UAE E-Commerce platforms. In 2015 that number
increased to $15 billion [2]. Apart from the conventional
products, users began to purchase a variety of goods and
services from E-Commerce platforms such as air tickets and
electronic products. In fact, a research conducted by [2]
found that a sample group of people spent an average of
$1500 on air tickets and $250 on general electronics
annually. Simply, we can correctly assume that E-Commerce
industry in the UAE was steadily growing well before the
pandemic hit [4] .
E-Commerce platforms have become a mega-trend
among UAE business peoples. The industry was expected to
grow to $10 billion in 2018 [5]. The results of expansion in
the industry has translated into a variety of spillover effects
as well such as new goods and services, higher quality, and
advanced technology. Before the pandemic, the UAE was
already well established in terms of digital trade [6]. The
pandemic did nothing but speed up the progress for E-
Commerce in the UAE.
Trade has slowly begun to resume, but global
partnerships and coalitions have changed. China has become
a significant trade partner of the UAE amidst this global
lockdown. Despite numerous trade sanctions to contain the
virus, the UAE has continued its trade partnership with
China to ensure supply chains remain functional and revenue
is generated to keep growth levels controllable. An increase
in online opportunities and employments has been observed
in the first quarter of the financial year for UAE. It is
expected that this number will increase as local businesses
and vendors find the majority of consumer demand shift to
E-Commerce websites and apps in pursuit of services and
goods. An estimate of [7] affirmed that E-Commerce holds
a 4.3% share in the total GDP of the UAE. However, a
forecast showed that the digital economy or E-Commerce
industry of UAE would grow to a staggering $63 billion by
2023.
The fight against coronavirus has halted economic
activities that require physical contact [8]. Comprehensive
guidelines and sanctions have been implemented even in
areas where there are no lockdowns or closures. The E-
Commerce industry had been steadily growing before the
outbreak of the virus. UAE was distinguished as an emerging
player in the global E-Commerce market as the
diversification of online and offline channels of business had
presented increased business activity. UAE advanced its E-
Commerce industry by continuously innovating and
redefining online catering of consumer demands. E-
Commerce had grown from a stable $1.3 trillion industry to
an astounding figure of $4.1 trillion from 2016 to 2019,
respectively.
UAE has been the leader in MENA countries for its
efforts to digitalize its economy. UAE was determined to be
a powerhouse and the fastest growing Middle Eastern player
in terms of E-Commerce [9]. Dubai had shown especially
promising statistics in regards to attracting online businesses
and future startups. The UAE E-Commerce sales were
estimated to be at $16 billion in 2019, and the upcoming
expected growth rate is almost 25% which is the highest in
the entire MENA region [10]. That has mainly been due to
the security and framework UAE has implemented for
making online transactions simple and easy. The market
penetration rate of the UAE was ranked at 4.2% in 2019,
followed behind by KSA’s 3.8%.
Another reason why the UAE has been witnessing an
annual increase in E-Commerce sales is because of its tech-
savvy consumer demographics. A research conducted by
1
https://www.smartdubai.ae/apps-services/details/uae-pass
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[11], showed that E-Commerce sales are directly dependent
on the demographics of a country’s population. E-
Commerce sales were generally higher in areas where there
was greater access to internet facilities. Similarly, a study on
E-Commerce done by [12] proved that people between the
ages of 18 and 28 were more likely to purchase goods and
services from online vendors as compared to physical
purchasing. Therefore, it is reasonably safe to assume that
the E-Commerce market was developing and emerging
before the outbreak of the new novel coronavirus.
When the previous strain of the Middle East Respiratory
Syndrome coronavirus (MERS) broke out, studies reported
a definite spike in E-Commerce sales and revenues of
different countries. However, the market was unable to meet
the excessive demand, and the wave was short-lived. As
mentioned before, the market for E-Commerce had already
been developing before the new coronavirus outbreak.
Therefore, the UAE was able to capture a more considerable
amount of online consumer demand and make significant
contributions to its GDP while the preponderance of
countries was heading towards financial collapse.
Nonetheless, there is still plenty of work to be done in the
digital sector in the upcoming years. In addition to this,
recent reports have shown that many countries, including
UAE, need to diversify their supply chain partners to meet
demand requirements and prevent a supply-side shock to its
economy in the case of a future outbreak [13-16].
The world had been witnessing an increase in remote
workers prior to coronavirus. Leading market players
estimated that coronavirus would significantly change the
nature and dynamics of jobs and employment. It was
estimated that by 2038, nearly 73% of all departments in the
UAE would have remote workers [17]. A similar trend has
been observed globally, as well. The position of UAE in
context to E-Commerce has been an accepting one. UAE has
not tried to fight against the changing market dynamics.
Instead, it has stood firm and adapted to different changes
and modified its regulations and frameworks to support the
increase in online business.
Moreover, the government has also placed vital
platforms such as UAE PASS1 to digitalize both the private
and public sectors of its economy if working remotely
becomes the new norm. The platform verifies the identities
of individuals and allows them to make transactions while
being in a secure position. This and a handful of other
reasons is why the UAE will successfully digitalize its
infrastructure and allows its economy to grow and become
stable in the upcoming years [2].
Despite holding a firm pose against established E-
Commerce market players, a collection of recent literature
states that economies that relied heavily on their natural
resources and tourisms would face comparatively more
difficult circumstances as compared to countries that were
engaged in trade [18]. The reason presented by [19] is that
the UAE is a tourist destination and its megamalls and
shopping centers are not only to satisfy the domestic and
international demand. Instead, they are part of the entire
experience. [20] furthers his argument by stating the
economy of UAE cannot function alone on domestic mass
production and consumption. Instead, it makes profits from
its multicultural and diverse economy. Although UAE is
abundant in natural oil reserves, the world is at a standstill,
and oil is not required currently. Therefore, it is uncertain
whether the UAE would be able to remain stable due to
coronavirus. Even if the MENA powerhouse increases the
digitalization of its economy, it would need to indulge in
international trade to increase the variety of goods and
services it offers to its consumers.
Consequently, a report published by Visa Middle East
found that there were nearly 19,827,000 active mobile
subscriptions in 2017 alone. The same report concluded that
34% of the population was under the age of 24. These digital-
native individuals are tech-savvy and support the global
onset of digitalization and E-Commerce [21].
Soon after COVID 19, [22] laid a foundational base that
opposed the idea of digitalization and provided strong
arguments towards any sort of innovative capacity. He stated
that consumer demand would decrease to level at which
firms and businesses would need to lay off workers. This
would reduce the overall income levels, and thus, even if
retailers were to switch to E-Commerce to provide goods and
services, no consumer demand would exist due to decreased
levels of income. Therefore, the relationship between E-
Commerce and COVID 19, and its nature depends on an
assortment of other factors as well. The UAE government
would need to incentivize or subsidize production so that
retailers can continue their businesses through E-Commerce
and more circulation of money takes place in the economy.
Supply-side shocks are argued to be more harmful to growth
levels as compared to a demand-side shock. Most businesses
in the UAE operate under the concept that, “Supply creates
its demand”. Supply chains and logistical operations need to
be modified and digitalized so that the economy can resume
without increasing the rate of infections.
[23], wrote an interesting article hinting at the increased
opportunities for economies as COVID 19 halts all physical
buying. She listed a handful of reasons why economies need
to shift their business online and what challenges they may
face in the entire procedure. Firms and companies need to
offer promotional products and discounts to kick start their
online operations. Further, she states that consumers in the
market should have symmetric information about the
company or businesses new operations. This means that
customers should be made aware that their preferred store is
offering their choice of products online; the store can make
its operations more efficient through previously performed
market research. By highlighting the most in-demand
products, more of its consumer base can be adequately
targeted, and sales can be increased. In addition to this,
customers should be given the top priority in this pandemic
by taking into account the financial constraints they are
currently facing. That can be done by offering customers
extendable payment invoices or payments after regular
intervals. This enables the company or store to restore
consumer confidence as much of it was lost due to the
reduction in employment and income.
Another implication for the E-Commerce market in UAE
is the disruption of supply chain networks. A report
published in the context to the global economy stated just
how crucial it has become for economies to expand their
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supplier base [24]. Consequently, a large proportion of
countries have stopped exporting goods and services to other
countries as infections have increased significantly.
Moreover, workers have fallen victim to COVID 19, which
has damaged the reliability of suppliers and condensed their
operations to zero. Therefore, it has become imperative for
economies to widen their supplier base and identify all the
associated risks early on to avoid a financial crisis from
hindering their economic development and growth. Both
supply and demand for imported goods and services have
been robust since the onset of the new novel coronavirus. It
is estimated that countries unable to implement an effective
risk management system in their E-Commerce operations
would have their progress set back by at least five to ten
years. Effective risk management systems should be put in
place to prevent the collapse of the E-Commerce industry as
either supply will dominate demand or vice versa. Hence, the
market needs to be pushed towards equilibrium through the
help of government intervention, policies, and practical
framework.
Nair [16] reported an unusual spike in online consumer
demand after the inception of COVID 19 in different
categories of products. For instance, the demand for skincare
products grew to 143.96% out of which 99.92% of the
increase resulted from orders made by new customers.
Similarly, a global surge in healthcare products such as
masks, sanitizers, and medicines was also reported. By
analyzing and forecasting changing market trends, the E-
Commerce industry of UAE can undoubtedly meet the
current digital consumer demand by creating supply chains
providing in-need products and services.
Similarly, [25] also put forward an article that states the
Dubai based Majid Al Futtaim financial giant, which
operates 24 shopping malls, reported almost 60% increase in
the demand for goods and services purchased through E-
Commerce facilities. Global companies have also
experienced a similar surge in online demand and have had
to make vital changes to their company operations. For
instance, Amazon hired nearly 300,000 full-time employees
and is expected to hire 250,000 more to meet the growing
online demand. Hence, UAE needs to get on the wave and
follow the global trend, which would not only create new
jobs but circulate currency within the economy at a faster
rate and speed up the process of restoration.
As per [26], retailers around the world have started to
augment advanced technologies in their business operations
to facilitate the consumer more effectively through virtual
reality systems, and AI. The retailers collect psychometric
information and analytics to provide the user with a more
personalized and individualistic experience. The product
preference of the user is recorded, and only similar or
relevant products are displayed to increase sale and
maximize the reduced consumer quantity. Additionally,
retailers have gone a step ahead and provide users with a VR
system so that they can assess the product more clearly and
adequately.
COVID 19 has sped up the process of digitalization
across all ecosystems and has created a future trend of a new
retail experience [27]. In his article, he further talks about
how all sectors of an economy will have to keep up with the
new trend of consumer demand through E-Commerce
mechanisms. He goes over critical areas, such as the future
of the automobile sector, education, fintech, and restaurants.
Similarly, the UAE also needs to determine the fate of its
lucrative industries to capitalize on digitalization. If the UAE
is successful in answering the questions on this matter, it can
indeed emerge as a global leader and innovator in the E-
Commerce sector. However, [27] concentrates on the
demand side of the economy more, as compared to the
supply chain management. He claims that the supply chain
should only be changed and digitalized if there is an adequate
response in digital demand. Retail, food, and medicines are
products that would most likely either show an increased
demand or remain constant. However, he argues that more
lucrative sectors such as automobile, education, and fintech
institutes should not be made digital before a proper
assessment of the market demand.
Continuing the argument laid down by [27], numerous
other research put forward also commented on the use of E-
Commerce in sectors such as healthcare and education. The
use of E-Commerce had been growing prior to the new novel
coronavirus outbreak. The quality of services being offered
to consumers of healthcare had been particularly improving
through E-Commerce and digitalization. The same picture
can be drawn for the healthcare system of UAE as it had been
offering multiple online services such as consultations and
checkups through video communication. Moreover,
healthcare companies had also been providing additional
services such as interactive tests that diagnosed symptoms
that users reported through personalized reports based on an
individualist approach. Nevertheless, the future of healthcare
through E-Commerce remains uncertain as the pressure on
health institutes has substantially increased because of the
outbreak of COVID 19. A similar case can be put forward
for the automobile and educational sectors as consumers
prefer a more immersive and hands-on experience before
making any purchases.
III. METHODOLGY
In order to obtain the relevant data, 125 different retailers
in the UAE market were surveyed to gain first hand detailed
primary data regarding the changes in demand and
performance due to COVID 19. The survey was orientated
on the use of E-Commerce methods and assessed how
swiftly retailers were able to shift their business operations
to online channels. The study attempted to determine the
demand conditions before and after COVID 19 to assess the
intensity of changes that may have taken place in the market
environment of the UAE.
The first part of the questionnaire was designed to
determine the E-Commerce market position before the onset
of the virus. Consequently, the latter part of the survey was
more useful to our multivariate regression analysis. It
enabled us to develop a relationship to assess the impact
COVID 19 had on the E-Commerce industry.
A closed-ended questionnaire was distributed among the
125 retailers to narrow down the answers to specific so they
could be enumerated. UAE government has placed
lockdowns, and Standard Operating Procedures (SOPs) have
been implemented, so the questionnaire was distributed as
per compliance. The questionnaire was distributed in the
local market within the city of Abu Dhabi.
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Data Sample: There is no real numerical measurement of the
E-Commerce industry in the UAE. In order to develop a
significant analysis and benchmark for the E-Commerce
industry, retailers had to be surveyed to understand the
switch from traditional selling techniques to digitalization in
their operations. The 125 recipients of the survey are from
the local UAE marketplace and all of them had turned to E-
Commerce after COVID 19. Since COVID 19 cannot be
quantified, the methods of local retailers had to be taken into
account to highlight an increase or decrease in E-Commerce
use due to COVID 19. We asked them questions related to
their supply and demand operations, and any change in them
were quantified as the effects of COVID 19.
The 125 retailers run small to medium scale departmental
stores that provide a range of products that are generally high
in demand. To make our research more specific and give an
accurate analysis, only stores that turned to some use of E-
Commerce were given the questionnaire. That allowed us to
make a better comparison between the two time periods and
uncover the impact on E-Commerce.
The retailers were asked to compare the performance of
their operations in both periods (before corona and after
corona). This allowed us to assess better the disruption they
faced in their services. A detailed data analysis, including the
results obtained from the regression analysis, is given below
in Tables II and IV.
The first five questions give us insight on the market
condition before COVID 19. We used supply and demand as
a proxy of COVID 19. The reason behind this is that the virus
causes significant changes in demand and supply of local
retailers. The retailers based their answers on how well their
business was performing prior to COVID 19. The last five
questions tell us the condition of the market after the virus.
Both the first and second part of the survey took into account
the retailers view on E-Commerce. The first regression was
performed using the first five questions. The second
regression was performed using the last 5 questions of the
survey.
x First five questions = first regression analysis.
(Benchmark)
x Last five questions = second regression analysis.
(Comparison)
IV. RESULTS AND ANALYSIS
A. Results
TABLE I. STATISTICAL ANALYSIS AFTER CORONAVIRUS
Measure Value
Number of obs. 125
F (2, 122) 4.21
Prob > F 0.0276
R-squared 0.8681
Adj R-squared 0.9045
Root MSE 0.76726
This data provided by respondents for the E-Commerce
market situation after the onset of coronavirus fits our model
very well. The goodness of fit is valued at 90%. That allows
us to conclude that our results are accurate and precise.
TABLE II. REGRESSION ANALYSIS AFTER CORONAVIRUS
Ecom = E-Commerce
supplyac = supply after corona
demandac = demand after corona
Our regression analysis confirms that the impact of
COVID 19 on the E-Commerce industry of UAE is positive
and has contributed to the advancement of digital buying,
and selling. From Table II, we can assert that whenever the
attractiveness of the E-Commerce industry grows by 1 unit,
supply and demand factors increase by 0.5 and 0.2
respectively. Similarly, the relationship can also be defined
contrarily. After COVID 19, whenever supply and demand-
side factors improve by 0.5 and 0.2 points respectively, the
attractiveness of the E-Commerce industry grows by 1 unit.
Moreover, a high F value seen in the Table I proves that the
relationship between our independent and dependent
variables is significant. However, it is essential to note that
this positive impact has been recorded as a reason for various
other market attributes. Adjustments to the supply chain
network and the massive stimulus package offered by the
UAE government has certainly kick-started the development
of E-Commerce industry.
TABLE III. STATISTICAL ANALYSIS BEFORE CORONAVIRUS
Measure Value
Number of obs. 125
F (2, 122) 3.56
Prob > F 0.0450
R-squared 0.7364
Adj R-squared 0.8699
Root MSE 0.69293
This model was designed to assess the view of the E-
Commerce industry from the perspective of retailers before
the onset of coronavirus so a better understanding could be
established about the impact of COVID 19 on the E-
Commerce industry. Similar to the previous model, our data
fit the model very well as the goodness of fit is valued at 86%
as indicated in Table III. Furthermore, a high F value
indicates that a significant relationship exists between our
dependent variable and independent variables.
TABLE IV. REGRESSION ANALYSIS BEFORE CORONAVIRUS
Ecom = E-Commerce
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supplybc = Supply before corona
demandbc = Demand before corona
Interestingly, the E-Commerce industry was growing
before the onset of coronavirus as well. The demand side
attributes for E-Commerce were similar to the period after
the outbreak of the coronavirus. A 0.2 point change in the
demand of products translated to a 1 unit increase in the
attractiveness of the E-Commerce industry. In the context of
our survey, this implies that whenever demand-side
attributes improved by 0.2 points, the E-Commerce industry
grew by 1 unit. The supply-side characteristics for E-
Commerce development were similar to the situation after
the coronavirus as well. This provides us with valuable
information regarding supply chain networks. The supply
reported by retailers in both periods shows us that the supply
chain has not been effectively digitalized. We can declare
that supply chain networks need to be more efficiently
managed to improve E-Commerce industry management
after the spread of coronavirus. In simple words, the supply
networks have been unable to meet the new online consumer
demand. However, COVID 19 has positively impacted the
E-Commerce industry, and future growth can be expected.
B. Analysis
As 125 retailers have been surveyed, the analytics were
done on the basis of their answers. 60% meaning
75/125*100 = 60%. That is how the percentages have been
determined. Similarly, 60/125*100 = 48%. Through this, we
were able to conclude the percent of people and how they
were impacted by the virus. 75 out of 125 people (60%)
enjoyed a high demand. 60 out of 125 (48%) people said they
wouldn’t have switched to E-Commerce if the virus hadn’t
spread. Hence, the percentage of people was used to quantify
the effects of COVID 19.
Through our survey, we were able to conclude that 60%
of our sample group retailers reported enjoying a high level
of consumer demand for their products. Similarly, 68% of
retailers said that the demand had been growing, which
means the macroeconomic indicators had also been
improving. Less than the majority (48%) retailers reported
that they would've not transferred their business operations
online if COVID 19 had not infected the Emirates. This
allows us to assert that the market position before COVID 19
was stable and growing, moreover; retailers were not that
open towards shifting their operations online either as they
were enjoying a high level of profit in their regular retail
routine.
However, our sample group of retailers altered their
position and stance on E-Commerce and decided to shift
their businesses online. In the first part of our survey, 48%
retailers reported they would not turn their operations to E-
Commerce, however; after COVID 19, 60% of the same
sample group stated they had altered their operations to meet
the increased digital consumer demand.
Regression Analysis
Two different time periods were analyzed in our
regression. The first period took into account the retailers
view of supply and demand before the virus. This helped us
in developing a benchmark to compare the effects in demand
and supply after COVID 19. The second regression takes
into account the supply demand factors AFTER the virus.
The first analysis was the benchmark. The results of the
second analysis were used to make the comparison and
quantify the effects of the virus. The results tell us that the
E-Commerce industry was growing even BEFORE the virus,
and AFTER the speed of progress increased due to COVID
19.
The regression analysis consisted of three variables out
of which, our dependent variable was E-Commerce. A major
complication was the attempt to numerate COVID 19. Still,
we used changes in supply and demand factors of two
different periods to determine the exact impact of the
infectious disease.
TABLE V. DEPENDENT AND INDEPENDENT VARIABLES
Dependent E-Commerce
Variable
Independent Consumer demand and producer
Variables supply before corona.
Consumer demand and supply after
corona.
● Y = B0 + B1X1 + B2X2 + B3X3 + B4X4 + e
● Y = E-Commerce
● X1 = Consumer Demand (before corona)
● X2 = Producer Supply (before corona)
● X3 = Consumer Demand (after corona)
● X4 = Producer Supply (after corona)
V. DISCUSSION AND CONCLUSION
We have been successful in describing a significant
relationship between E-Commerce growth and COVID 19.
Our analysis shows that the demand for goods and services
has remained the same in both periods (before and after
corona). This means that the stimulus package, including
special funds and subsidies, have successfully protected the
consumer income levels from allowing demand to remain
persistent throughout the domestic market. In addition to
this, the retailers have also responded quickly to the market
dynamics and have developed online business channels to
keep their business operations functional and profitable. The
tech-savvy population dominates the overall population
demographics of the UAE, which is one of the reasons why
consumer demand has remained stable. A large portion of
the population also has mobile devices and adequate access
to internet services.
However, the supply network story is poles apart, and
sizeable improvements are required to be made. The supply
levels have remained conventional despite the spread of
coronavirus. Suppliers have not digitalized their operations
or made efforts to resupply retailers and small businesses
remotely. A comprehensive set of guidelines should be
drafted by UAE officials to serve as a blueprint for supplies
all around the country. The results from our conducted
survey tell a similar story. Through the responses of retailers,
we were able to determine that the demand levels only
dipped initially but reached their average level soon after.
The purchasing of goods and services remained constant and
only shifted from conventional physical purchasing to online
E-Commerce channels. Improving the quantity and quality
of supply will create competition amongst E-Commerce
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sellers as failure to meet consumer demands will result in a
loss of customers. Similarly, from the customer’s
perspective, a wide range of options will be available in the
form of different sellers and E-Commerce platforms.
Therefore, sellers and retailers will have to be mainly
customer orientated.
A. Research Limitations
The biggest constraint in the research was coronavirus
itself. Firstly, the effect of the virus had to be quantified so
that its impact on the E-Commerce industry could be
uncovered. Secondly, our survey was only distributed to 125
retailers due to lockdowns and SOPs issued by the
government. We were also unable to get the consumers
perspective as the risk of infection was very high.
B. Recommendations
1. The UAE government should draft specific policies
that force all retailers regardless of their size to turn
to E-Commerce business methods so that no output
is lost. Moreover, the government also needs to
provide particular guidelines to these businesses in
terms of hiring employees. The employment rate
will be a significant concern of the authority as E-
Commerce and digital purchasing allows
corporations and businesses to cut down on their
staff as the number of operations has reduced.
Therefore, to maintain the employment rate and
protect households and economics agents, the
government needs to address the situation
immediately and divert attention where it is
necessary.
2. A lower and upper limit should be set as to how
many goods and services a single consumer can
purchase. This will prevent any cases of hoarding
and also improve the supply chain efficiency by
making the frequency of shipments more stable and
punctual. Moreover, the government can designate
special days when deliveries will be made, so
consumers make all their purchases before that day.
That will improve the entire process of buying and
selling as both the producers and consumers will
only have to collect or ship their shipments once per
week.
3. Alternate methods of payment should be introduced
to facilitate those who have been affected more by
the coronavirus. Firstly, a secure means of
transactions should be implemented that allow
producers to feel more relaxed regarding their
payables. This will also serve as an incentive for
consumers to purchase more goods and services
with the added option of paying later or at regular
intervals. Items can be segregated based on special
packages and discounts, for instance; the payment
of luxurious goods and services should be extended
to a period of six months. Failure of the consumer
to pay the amount in the designated amount of time
would result in a fine or penalty. Similarly, this will
create a regular flow of incoming payments to the
producer or seller as well.
4. The lack of jobs can be made up for by establishing
call centers, including customer support centers,
 and online order tracking centers. This will help
create jobs in the economy, and consumers can be
supported 24/7 without having to wait for their
shipments continuously.
C. Conclusion
UAE has successfully transferred its physical business
operations on online E-Commerce channels while
maintaining consumer demand. A few modifications need to
be implemented in the regulations and frameworks so that
supply-side factors can be made more stable. Due to COVID
19, international supply chains have become disrupted due
to the lockdowns of countries all over the world. If UAE
wishes to emerge as a leader in the E-Commerce industry of
the world, it will have to carefully expand its supplier base
by starting trade with new international partners. That will
not only diversify their trade and supply portfolio but also
help in reducing future adversities resulting due to supply
chain inefficiencies. The E-Commerce sector had been
developing at a rapid rate before COVID 19. If anything,
COVID 19 has sped up the process and scaled the E-
Commerce industry of UAE on a new level.
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