Shams Free Zone x Cargos: Space to Grow

Let me ask you something: where does your business sleep at night?

Is your inventory squeezed into a corner? Sitting in a warehouse you barely use? Or worse, are you paying rent for space that’s collecting more dust than profit?

Today, we are talking about space. Not the NASA kind, but the kind that can make or break your business growth.

Today, we are celebrating a powerful partnership between Shams Free Zone and Cargos. Two brands that believe businesses deserve smarter solutions, smoother operations, and room to grow — literally.

So, let’s dive right in.

Prem is the Founder and CEO of Cargos.com, an online platform that serves as an Airbnb for commercial warehousing. As a serial entrepreneur from the logistics industry, Cargos is Prem’s second stint at entrepreneurship.

Prem has built Cargos from a fledgling team of just five members to one of the largest commercial warehousing networks in the UAE, with over 100 team members and more than 1,000 warehouses on the marketplace.

Prem, pleased to meet you. How are you?

I’m good. Really good. Thank you so much for having me.

My first question would be: if Cargos was a person and they just walked into the room, how would you introduce them to our audience?

Interesting. Cargos would be a very friendly person who understands your requirements really well, empathizes with the storage problems you are trying to solve, works with you and your team throughout the whole journey, and completes the storage requirement that you might have.

Amazing. I think that’s what all startups need, right? They need assistance and expertise. What better than somebody who can come with experience and handhold you to your success?

Thank you.

So Prem, let’s start from the beginning. What prompted this change? What made you feel that the UAE needed this as a solution?

This actually started from a personal need I had before I started. I had my previous startup, which was growing really fast, and I wanted access to quality storage within a few days, but it was very difficult to find such solutions.

Typically, in the traditional way, if you are an SME or a growing company and you want warehousing space immediately, it is not that easy.

The traditional way of looking at it is that you go to one of these property-finding platforms, get the broker’s name, call them, negotiate the prices, and then from discovery to the time you sign the contract with the owner and set up your warehouse, it takes around four to eight weeks.

That’s a lot of time for an SME. Really long.

It’s long and very expensive. You lose the opportunity to grow and get access to the space available to you.

So it came from that requirement that I had personally. I was checking around with other SMEs and startups, and they had similar problems. When they wanted space immediately for a few months or for certain projects, they were not able to get it.

This accelerated after COVID. Traditionally, if you are an SME and you’re looking for warehousing, you take at least one to three years of long-term contracts, which you cannot break.

During COVID, a lot of SMEs suffered because they couldn’t legally break the contract, and it cost them a lot.

So SMEs started looking for short-term, on-demand storage. Because this demand was growing, on the other side, landlords were finding it difficult to get tenants, and there were a lot of warehouses with empty spaces at the same time.

We thought technology could bridge these two requirements. On one side of the market, SMEs need warehousing in a flexible, on-demand format where they can pay monthly. On the other side, there are many warehouses with empty or unused capacity.

So I thought technology could bridge this gap, similar to what Airbnb has done and what Careem has done very well in the region. This is what we try to do at Cargos.

I’m sure startups and SMEs would highly benefit from this as well, because they are always looking to start out and save costs. I’m sure it is going really well for startups and SMEs.

Yes, I totally agree. As a startup, what you want to be mindful of is how much you spend and how little you can spend. You need to preserve cash so that you can last longer until you validate whatever hypothesis you are trying to validate as an SME.

Our solution helps in this journey. For startups, it is an extremely cost-effective solution, and it also helps them find warehouses much faster.

What we have done is bring down the four-to-eight-week timeline to get a warehouse to 24 to 48 hours.

Oh wow.

Today, you come to our platform and look for a warehouse, and tomorrow you can bring your goods into the warehouse.

Fantastic. I think it is all about speed, especially in this part of the world. For Shams Free Zone, we recently launched our fastest-ever business license, where we issue the license within 60 minutes.

Wow.

So I believe we can see the alignment and the need for speed in this region for sure.

Amazing. Speed also means lower cost.

Absolutely.

What you have done is a great improvement on the current model. I think it usually used to take two to three weeks to get a company registered.

Yes.

Bringing it down to 60 minutes.

Absolutely. We are receiving a great response from clients because that saves them time and allows them to focus on what they plan to do after incorporating the company.

Amazing. I think we are on a similar journey where we are trying to go faster. We are also trying to make the discovery of warehouses and moving into a storage space much faster than how it was traditionally.

So far, we have done it successfully. We have served over 2,000 SMEs in the last four years or so. With the new products we are rolling out in the coming months, we are expecting it to grow even faster.

Amazing.

This means we are able to cater to certain requirements that SMEs really care about, which are saving time, saving cost, and making sure they only pay for what they use.

Amazing. That sounds great.

Prem, tell us more about the biggest mistakes businesses make when they are looking at storage solutions.

I wouldn’t say mistake as such. The traditional thinking is that when you start a company, especially in e-commerce or trading, you are required to take a warehouse for at least a year or so.

This has been a misconception in the market generally speaking. Because people are conditioned to think like that, they go and lease warehouses for one year or two years.

When I say this is not required, what I mean is that when you take a warehouse, every square foot you do not use is a cost on you.

Usually, when you start off and take, let’s say, a 3,000-square-foot warehouse, you don’t fill up the warehouse from day one. It takes two to six months to gradually start filling up the warehouse.

But when you calculate your storage cost, you calculate it at a 70% occupancy rate and add that storage cost to the commodity you are trying to trade or sell.

Until you hit 70% occupancy, this eats into your profit and margin.

Absolutely.

It is not really a great idea to lease a warehouse for a year or so until you are sure that you are going to occupy 70% or more of the space you lease.

That is where we come in. You can start with us with one pallet, three or five boxes, all the way to maybe 20 or 30 containers.

Until then, you can use on-demand flexible storage with us. When you are sure that you are going to occupy 70% of the minimum space you really lease, that is when you can go ahead and lease a warehouse.

We are not saying completely rule out the entire leasing model, but at least in the early 10 to 12 months of your journey, we can be useful because we help you save time, save cost, and experiment faster and cheaper.

As a startup, I know what you mean, especially for startups that are just testing the waters to see whether the product will do well in the market or not. This is the best way forward because they can book storage for a short while, test the market, see the response, and scale up accordingly instead of investing a lot in inventory and storage.

Exactly. We had a company that came to us asking for a 3,000-square-foot warehouse.

We asked them why. They said, “I thought that’s how we start.”

We asked how many items they were going to bring into the country. They said only one container.

I said, “For one container, you don’t need a 3,000-square-foot warehouse. You can start storing with us and do your experiment.”

He was trying to bring rice into the country. He continued storing with us for almost 10 to 12 months. He started with one container and scaled his operations to 25 containers a month.

Wow.

We provided one space close to his market where the fast-moving goods used to go, which was a little expensive, and the slow-moving items were stored farther away, which was cheaper for him. He maintained two storage locations at the same time: one expensive but closer for fast-moving goods, and one cheaper for items he needed to store longer.

This way, you can experiment and, at a later stage, decide whether to lease. Interestingly, he is still with us and uses around three or four locations in different parts of the UAE, keeping stock close to his customers.

Wow. I think Shams Free Zone has a particular cost advantage that we all know. Along with that cost advantage, combining Shams Free Zone and Cargos would mean a lot to SMEs when they start off.

I love the fact that clients can tailor the packages as per their requirements. They can choose short-term or long-term storage, decide how to store their goods, and your team helps them make the right decision. I believe that’s a major role you play in helping them customize and save costs. That is exactly what startups are looking for.

Absolutely. We have storage starting from one day, and recently we signed a contract for five years.

Oh wow.

We store from one pallet or even five boxes. The largest customer we stored for had around 250 forty-foot containers.

Wow. That’s music to my ears because we get a lot of requests from our clients looking for something similar. To be honest, e-commerce happens to be one of our best-selling activities, so it’s a win-win for us and the client because the client is looking for exactly that.

Perfect. For smaller e-commerce companies, we are launching an exclusive product this year.

Really? Tell us.

You can take a small room, which will start somewhere between AED 550 to AED 800 a month.

That’s a very good price, to be honest.

It is one of the cheapest options you can get in the market right now. You can arrange small kitchen-style shelves, put a small table for your printer and other things, and we can process your orders.

You can then send your driver or whoever you have arranged for pickup to come to the location and collect the items.

Fantastic.

Why we think this is going to be a huge success is that there was demand from our customers, and it saves a lot of their other costs, like pickup cost, fulfillment charges, delivery, and packing charges when you go to a larger fulfillment center.

For starting out, this would be best where you can manage up to 10 to 20 orders a day. Once you go beyond 30 or 40 orders, then it might be a good idea to start storage with a fulfillment center.

Our idea is that you start with us, scale your business, and Shams Free Zone is a great place for you to start, scale, and test the waters. Then you can take it to a place that you think is best for your storage requirements.

That testing platform, both in terms of the market through Shams Free Zone and storage through Cargos, is what we believe is the best value we provide together.

That is why I believe we are sitting here today and discussing our partnership, which we are really excited for.

Thank you so much. Really appreciate it.

Prem, let’s talk money. Are flexible storage facilities actually cost-effective, or is it a misconception?

It is extremely cost-effective, especially when you start off.

I’ll give an example. If you are trying to lease a warehouse in Sharjah per year, the current market price is between AED 40 to AED 65 per square foot per year.

On average, you will spend around AED 180,000 to AED 200,000 for the warehouse lease.

That’s a substantial cost.

A lot of money.

Yes, and the worst part is you have to pay at least quarterly in advance, plus the entire year’s VAT in advance. Then there is municipality fee, admin charges, and agency commission on top of it.

Wow. There are a lot of overheads here.

It works out to around AED 80,000 to AED 90,000 before you get the key in your hand.

Wow.

Then you have to set up the warehouse, which will take another month or so. So you have paid so much money and you have not even started storing yet.

Through this whole process, you are not even sure if your business will be successful or whether you will require this much space.

Instead of paying AED 80,000 or AED 90,000 to get the warehouse key, use that amount of money to store your goods with Cargos for the first six to eight months.

That means you save around 60% to 70% of your storage or warehousing cost by storing with us.

This is the kind of saving we have calculated, and this is not theoretical. We have done these calculations with many customers and demonstrated this level of storage savings.

If any customers would like to know more, we can walk them through the full cost-saving calculation using Excel and their own cost inputs to show what they are going to save.

So Prem, now we will be breaking some myths because I know there is a lot of confusion around storage facilities and people do have misconceptions. Let’s break them together.

Let’s do it.

Flexible space is more expensive than traditional warehousing.

That is a big myth. Flexible storage in the early days of a company can save a lot of money. In our calculation, it saves up to 70% of your yearly storage cost when you start off.

Oh wow, that’s huge.

You need to commit to a full warehouse even if you use half of it.

That is a fact if you are using a traditional warehouse. With Cargos, that is not the case. You can store one pallet up to 1,000 pallets for one day to one year.

Wow, that’s amazing.

Scaling your storage up and down is complicated and risky.

With Cargos, it’s a real factor. It is very easy to scale up and scale down. Some months, you may have 100 pallets. The next month, you may have only five pallets. The month after, you may have 50 pallets.

Going up and down with Cargos is easy. That is one of the biggest value propositions we have for our customers.

So you can upgrade or downgrade as per your requirement whenever you need?

Yes. Just like a SaaS product.

Amazing. Is it monthly, or can it be as and when the requirement comes?

Typically, it is monthly, but there have been instances where we have done it even daily.

Oh wow.

Warehousing is only about space and nothing more.

That is actually a myth. Warehousing can make or break your business. If you do not understand the cost implications, it will eat into your margins and profits, and before you know it, it can become extremely costly.

I know this one is a big one: storage strategy does not impact your business growth.

It is a big myth. That’s the short answer. There is a cost to your storage. With the traditional model, the cost of storage keeps varying depending on the occupancy rate of the warehouse.

With Cargos, the storage cost is always fixed. It helps you in many aspects of your strategy when you are growing and scaling up your business.

E-commerce businesses can manage efficiently without a storage structure in place.

It’s a myth. It is nearly impossible for an e-commerce company to manage storage without proper infrastructure. It could be as small as a small room or as complex as a fulfillment center. They need to have something organized.

Absolutely.

Shared warehouse models can actually prove to be more sustainable.

It’s a fact. It is sustainable in many ways. Sustainable in terms of how much cash you can keep with you to test your market, and sustainable environmentally as well because you are using fewer resources and increasing efficiency generally speaking.

So in many ways, it is sustainable.

Prem, thank you so much for highlighting all the benefits that clients can get with Cargos. What about Shams Free Zone clients? What special deals or discounts can our clients get?

There are amazing plans we have for Shams Free Zone clients. It will start with a flat 15% discount for any customer that comes through Shams Free Zone.

That’s a huge saving on top of what you are already saving them.

Absolutely. This is an exclusive offer we are making for Shams Free Zone customers. In some cases, we can go up to a 25% discount on certain areas and certain types of storage.

Fantastic. I’m sure our clients are as excited as I am listening to this offer, and I’m sure they can all benefit from this partnership.

Absolutely. Thank you so much. We appreciate that.

At the end of the day, business growth isn’t just about ambition. It’s about infrastructure. It’s about having the right partners, the right strategy, and yes, the right space.

Because when your storage works smarter, your business moves faster. And when innovation meets opportunity, growth is inevitable.

That’s the future we are building together.

Thank you so much, Prem, for coming in today and enlightening all of us. It was such a pleasure.

Really appreciate this. Thank you so much.