Saudi Arabia food
services market is growing owing to the rising population, shifting
preferences of the young and active generation that uses digital media
extensively and is aware of the range of food service options, the market has
grown significantly over the last few years and is predicted to continue to
grow rapidly during the forecast period. The growing demand for
customization and creativity in food menu options is one of the main factors
influencing the Saudi Arabia food service market. The development of e-commerce
and online platforms as well as on-the-go food delivery services are additional
factors that support the expansion of this market. In addition, the country's
growing demand for food services is creating enormous growth opportunities for
manufacturers.
The COVID-19 pandemic
has had a significant impact on the Saudi Arabia food services industry. In
2020, after the government imposed a nationwide lockdown to stop the spread of
the disease, fine dining services experienced a decline. While the quick service
restaurant industry has partially recovered due to the rising demand for home
delivery services, the fine dining industry has still not fully recovered. Even
after receiving the COVID-19 vaccine, consumers continued to prefer eating at
home and avoid fine dining establishments through the year 2021.
The sales in
consumer foodservice are anticipated to further increase during the
forecast period with the growing number of opportunities for the food service
offering options other than restaurants, cafes, quick service restaurants with
the wide range of audience from the various nations of about more than 7
million tourists who travel to Saudi Arabia each year to perform Hajj and
Umrah.
Jeddah, which is home to
at least 7% of the restaurants in the country, is one area that is particularly
open to development. When compared to other cities, Jeddah not only displays a
larger market but also reflects a higher level of spending, with average checks
only trailing Makkah and exceeding Riyadh by nearly 30%.
Elevating Number of Food Court in Shopping Malls
Saudi Arabia has seen a rapid increase in the number of food and shopping
malls in recent years. In the past ten years, shopping malls that were
previously only found in capital cities have begun to appear in tier 2 and tier
3 cities. The design of food service and lifestyle areas, including standalone
food stalls and kiosks, is increasingly a focus of new shopping center
developments and extensions. The establishment of the F&B footprint in
retail projects gives the food service operators the chance to boost customer
traffic and dwell time, which will ultimately lead to increased food spending.
It is also becoming one of the most well-liked tourist locations in the Gulf
nations. This factor is significant because consumer behaviour is continuing to
focus on the culture of shopping malls.
Propelling Investments Within
the Food Service Industry
Despite the presence of several notable players,
the market is highly fragmented. The momentum of the market's growth has been
markedly increased by the rising acceptance of casual dining, the rise in
demand for fast food and its variations, as well as the accelerated expansion
of food courts. Therefore, it is expected
that market participants' partnership strategies will enhance market growth. In
January 2022, approximately 53 million dollars were invested by Halwani Bros.
Co. in Aquat Food Industries Co. which is an Albaik Food Systems Co.
sister company. The company hopes to use this agreement to supply the locally
produced food items needed to run Albaik restaurants in Egypt. Starbucks
Corporation, McDonald's Corporation, Domino's Pizza, Inc., Papa John's
International, Inc., and other well-known companies are some of the key
players.