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Technavio’s market research analyst predicts the food retail market in Saudi Arabia to grow at a CAGR of around 5% by 2020. Saudi Arabia accounts for around 51% of the total food retail sales in the GCC region, thanks to the rising population and the increasing disposable income of people in the country. The food retail outlets in Saudi Arabia carry a broad range of options for consumers such as domestically processed foods, imported specialty food products, and organic food products. Consumers prefer to shop at supermarkets and hypermarkets as these food stores also provide an outing for families. The retailers in the food market are trying to increase their stores to gain more market share and consumer segments. With the rise in the influx of tourists in the country because of Mecca, the demand for packaged food in this region will see tremendous growth in the coming years.
One of the latest trends gaining prominence in the food retail market in Saudi Arabia is the increasing use of private-label brands. Most Saudi supermarkets have their private-label brands. The Saudi importers purchase food products under their brand names and pack those products locally using their label. Private-label brands with Arabic sounding brand names are more appealing to Saudis and other Arabs in the country. For instance, one of the largest importers in Saudi Arabia uses the Arabic sounding brand name Al-Alali for its products to appeal to Saudi nationals.
The cereals segment will continue its dominance in the market during the forecast period and is expected to occupy more than 49% of the total market revenue by 2020. The growing population and surge in urbanization are driving the demand for cereals, especially breakfast cereals, among consumers. Factors such as the rising women population and growing demand for convenient products that can be consumed on-the-go are expected to boost the growth of this segment during the forecast period.
Supermarkets and hypermarkets are the main channels of distribution of food products in Saudi Arabia and accounted for more than 56% of the total market share in 2015. Saudi Arabian supermarkets and hypermarkets chains import their products such as cheese products, nuts, fresh fruit, condiments and sauces, cereals, ketchup, fruit juices, and vegetables from the North American and European countries. The growing entertainment facilities in these hypermarkets are improving the shopping experience of customers, thereby leading to frequent shopping trips to these places.
The market is dynamic with the presence of a vast number of players and is dominated by modern retail chains such as supermarkets and hypermarkets. The Saudi Arabian retailers are constantly searching for new products and are focusing towards product promotion and advertising of those products. Vendors in the market are aiming for better market positions through competitive pricing, weekly promotional offers, and by offering advertisement support to the customers.
Key vendors in the market are -
Other prominent vendors in the food retail market in Saudi Arabia include Al Raya Supermarkets, Al Sadhan Supermarkets, Balsharaf Supermarkets, Bin Dawood Supermarkets, Farm Supermarkets, Lulu Hypermarket, Manual Hypermarket, Marhaba Supermarkets, Sarawat Supermarkets, and Star Hypermarkets.
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PART 01: Executive summary
PART 02: Scope of the report
PART 03: Market research methodology
PART 04: Introduction
PART 05: Market landscape
PART 06: Market segmentation by product
PART 07: Market segmentation by distribution channel
PART 08: Market drivers
PART 09: Impact of drivers
PART 10: Market challenges
PART 11: Impact of drivers and challenges
PART 12: Market trends
PART 13: Vendor landscape
PART 14: Appendix
PART 15: Explore Technavio
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