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The Saudi Arabia - Retail Market size is forecast to increase by USD 54.46 billion, at a CAGR of 6.42% between 2023 and 2028. The growth of the market depends on several factors such as economic diversification under Vision 2030, rising consumer spending power, and the growth in the tourism sector in Saudi Arabia.
The report includes a comprehensive outlook on the market offering forecasts for the industry segmented by Type, which comprises non-food retail and food retail. Additionally, it categorizes Distribution Channel into bakalas, super markets, hyper markets, and online. The market analysis and report provides market size, historical data spanning from 2018 to 2022, and future projections, all presented in terms of value in USD billion for each of the mentioned segments.
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Our researchers analyzed the data with 2023 as the base year, along with the key drivers, market growth and trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Economic diversification under Vision 2030 is notably driving market growth. The initiative, spearheaded by the Saudi government, aims to reduce the country's reliance on oil revenues and promote a more diversified and dynamic economy. As part of this vision, strategic investments are being made in the retail sector to foster innovation, entrepreneurship, and job creation. Further, vision 2030 emphasizes the importance of enhancing the competitiveness of the retail sector through digital transformation and technological innovation. Retailers are increasingly adopting e-commerce platforms, digital payment solutions, and other technological advancements to cater to the evolving preferences of consumers.
However, the Saudi Arabian Monetary Authority's (SAMA) initiatives to facilitate digital payments and fintech innovation contribute to this transformative market trends and analysis in the retail landscape. By diversifying the economy, Vision 2030 is creating a more resilient and consumer-driven retail sector, attracting investments, and fostering a vibrant market that aligns with global trends. These developments are expected to drive sustained growth in the market during the forecast period
Integration of technology in the retail sector is an emerging trend shaping market development. Technology such as AI and data analytics, enables retailers to gain insights into consumer behavior. The integration of advanced technologies in e-commerce platforms facilitates seamless transactions, secure payment options, and efficient order fulfillment. Further, the adoption of digital payment solutions, including mobile wallets and contactless payments, streamlines transactions and contributes to a cashless retail environment. This not only enhances convenience for consumers but also aligns with global trends in digital finance. Technology-driven solutions such as blockchain and IoT applications, are optimizing supply chain processes.
Additionally, instances such as the widespread adoption of the Buy Online, Pick Up In-Store model, the use of mobile payment apps, and the deployment of AI-driven chatbots for customer inquiries illustrate how technology integration is becoming a catalyst for growth in the retail market in Saudi Arabia. Retailers embracing these advancements are well-positioned to meet evolving consumer expectations and contribute to the growth of the market during the forecast period.
Regulatory compliance associated with the retail industry in Saudi Arabia is a significant challenge hindering market growth. The evolving regulatory landscape, both domestically and internationally, introduces complexities that impact retailers' operations and strategies in Saudi Arabia. The retail market in Saudi Arabia heavily relies on imports, and changes in import regulations can affect the supply chain and increase costs. Furthermore, stringent consumer protection laws necessitate retailers to ensure product quality, safety, and fair pricing. Compliance with these regulations demands investments in quality control measures, transparent pricing strategies, and effective dispute resolution mechanisms.
Moreover, retailers must navigate these regulations to secure online transactions, protect customer data, and ensure a seamless digital shopping experience. Addressing these regulatory challenges requires a proactive approach, investment in compliance management systems, and continuous adaptation to changing legal frameworks, which will negatively impact the growth trajectory of the market during the forecast period.
The market research report includes the adoption lifecycle of the market research and growth, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth and forecasting strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Abdullah Al Othaim Markets Co. - The company offers retail solutions for grocery, fresh and bakery products, frozen foods, beverages, health and beauty products, and home care products.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The non-food retail segment is estimated to witness significant growth during the forecast period. A growing population with increasing disposable income, coupled with changing consumer lifestyles, has fueled demand for a diverse range of non-food products. The government's Vision 2030 initiative, aimed at diversifying the economy and promoting the private sector, has also contributed to the expansion of the retail landscape
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The non-food retail segment was the largest and was valued at USD 61.09 billion in 2018. The surge in e-commerce platforms such as Souq.com (now Amazon. sa) and Noon, has further accelerated the growth of the non-food retail segment. These platforms offer a convenient and diverse shopping experience, contributing to the overall expansion of the retail market in Saudi Arabia. The retail sector's response to the COVID-19 pandemic has also driven the adoption of online channels and digital platforms for non-food products, fostering the growth of the non-food retail segment. As consumer preferences continue to evolve, major vendors in the Saudi Arabia - retail market are likely to focus on innovation, omnichannel strategies, and product diversification to sustain and enhance the growth of the non-food retail segment during the forecast period.
The market report forecasts market growth analysis by revenue and provides an analysis of the latest trends and growth opportunities from 2018 to 2028.
Saudi Arabia Retail Market Scope |
|
Report Coverage |
Details |
Page number |
125 |
Base year |
2023 |
Historic period |
2018-2022 |
Market forecasting period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 6.42% |
Market Growth 2024-2028 |
USD 54.46 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
6.22 |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Abdullah Al Othaim Markets Co., AL SADHAN, Ali Hassan Al Dahan and Partner Co. Ltd., Arabian Stores Co. Ltd., Azadea Group, Balsharaf Group, Bindawood Holding, Cenomi Retail, CHALHOUB GROUP, Jarir Marketing Co., Lulu Group International, M. H. Alshaya Co. WLL, Majid Al Futtaim Holding LLC, Manuel Supermarket, Nahdi Medical Co., SACO, Saudi Marketing Co., Savola Group, Tamimi Markets, and Virgin Red Ltd. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Type
7 Market Segmentation by Distribution Channel
8 Customer Landscape
9 Drivers, Challenges, and Trends
10 Vendor Landscape
11 Vendor Analysis
12 Appendix
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