RIYADH: Alshaya Group, a leading global brand management company, plans to make long-term investments in Saudi Arabia over the next three years.
These investments will include expansion in the retail and real estate sectors, as well as the introduction of new brands to the local market, according to John Hadden, the group’s CEO, who spoke to Al-Eqtisadiah newspaper on the sidelines of the Retail Leaders Circle Global Forum.
Hadden stated that Alshaya has been operating in the Kingdom for nearly 40 years and that the Saudi market is now one of the group’s most important strategic growth regions, given the rapid pace of urban development projects and rising consumer demand.
The Avenues Project in Riyadh, Khobar
He explained that the group is partnering with Al-Fozan Co. to develop two major commercial projects, The Avenues Riyadh and The Avenues Khobar, which are expected to open within the next two years. He added that these projects represent a long-term investment that reflects the group’s confidence in the growth of the Saudi economy.
He indicated that the group plans to expand its existing brands, in addition to introducing new brands in the food and non-food retail sectors over a period of two to three years, emphasizing that investments allocated to the Saudi market represent a key part of the group’s regional expansion plans.
Entering the fast-food market, expanding into the beauty sector
The CEO revealed the group’s entry into the fast-food market with a new US brand, “Chipotle,” which is scheduled to launch in Riyadh within the next six months, following its entry into other Gulf markets.
The group will also launch the “Ulta Beauty” brand in the multi-brand cosmetics sector, representing a new expansion within its existing business in the Saudi beauty market.
He stated that the Saudi market is one of the fastest-changing markets in terms of consumer behavior, requiring companies to continuously invest in developing operating models that combine traditional stores, e-commerce platforms, and delivery services, amidst increasing competition from local and international players.
Betting on Saudi economic growth
Regarding his expectations for the next five years, Hadden indicated that the overall outlook is positive despite some challenges related to consumer confidence and disposable income levels.
He emphasized that the group is adopting a long-term investment strategy in the Kingdom, driven by its belief in the strength of the local economy and the objectives of Vision 2030, in addition to investing in human capital development.
A retail sector exceeding $133bn
The retail sector in Saudi Arabia is the largest in the region. Data from the General Authority for Statistics indicates that wholesale and retail trade, restaurants, and hotels contribute more than 10 percent to the non-oil gross domestic product, while the retail market exceeds SR500 billion ($133 billion), with an annual growth rate ranging between 5 percent and 7 percent.
The sector’s growth is based on population expansion, a high percentage of young people, and urban development, as well as modern shopping centers and the rapid evolution of e-commerce.
Saudi Vision 2030 also aims to increase the private sector’s contribution and diversify the economic base, which enhances the attractiveness of the retail sector for both local and international investment, specifically with the entry of new global brands and the expansion of existing companies.
