SAUDI ARABIA FMCG MARKET

KEY FINDINGS

• Online sales of fast-moving consumer goods (FMCGs) are significantly outpacing the overall market in Saudi Arabia, accounting for a combined value of more than $623 million and creating a new stream for economic growth
• F&B segment is the dominant market in fast-moving consumer goods (FMCG), however, the beauty and cosmetic market segment is also growing rapidly in Personal Care sector.
• The beauty and personal care industry was among the first to adapt to the shifting consumer behaviors amid lockdowns, where the spends of Saudi women are increasing in new digital beauty platform.
• Online purchase or online market is rapidly growing, as in 2021 the online market grew about 58%in 2022, so it is expected to grow by CAGR 25% till 2030.
• Major key players in the market are Nadec, Almarai, Nestle Middle East, Beiesdorf AG, Reckitt Benckiser, P&G and many more.
• The construction of a new terminal in Abdul Aziz Airport is part of a major plan to put the Kingdom's airports among the world's leading and largest airports. Kingdom’s civil aviation sector has recently achieved qualitative leaps and creative developments that contributed to 4.6% of GDP. 
• Saudi Arabia is focusing more on the tourism industry. Thus, it will increase the GDP of the country, which in turn will boost the FMCG market.
• In the FMCG market of KSA, food and Beverages enjoys the largest share of the market, where, the residents of KSA enjoy and prefer, non alcoholic drinks, halal products and products supporting Muslim values.
• Saudi Arabia is likely to be one of the world’s fastest-growing economies  as sweeping pro-business reforms and a sharp rise in oil prices and production power recovery from a­ pandemic.
• The home care segment in FMCG is the smallest segment with 7.2% of the total FMCG market at present. Hygiene sector makes up 70% of the home care market in which laundry and home cleaning products are more prominent in KSA.

INTRODUCTION

Saudi Arabia, like the other GCC nations, has a large GDP and a young, expanding population.The demand for juices, dairy products, and other foods and beverages is bolstered by these factors.

The government's emphasis on diversification and food sufficiency is anticipated to be the driving force behind the expansion of the food and beverage industry as economic conditions improve. 

SAUDI ARABIA FMCG MARKETSIZE AND FORECAST

TheSaudi Arabia FMCG marketaccounted for $XX Billion in 2023 and is anticipated to reach $XX Billion by 2030, registering a CAGR of XX% from 2024 to 2030.

COVID IMPACT

The COVID-19 pandemic is anticipated to have a negative impact on Saudi Arabia's economy. Due to COVID-19, Saudi Arabia's growth in real gross domestic product (GDP) is anticipated to slow, unemployment to rise, and current account balance to fall.

The global COVID-19 pandemic has altered lifestyles and trends;Saudi Arabia's FMCG industry was no exception.When it comes to their shopping habits, customers are expecting more convenience.

Due to issues with the supply chain, more than a third of Saudis surveyed reported switching to online shopping.In addition, consumers are considering alternatives that are healthier and more sustainable.

To reduce their impact on climate change, approximately half of survey respondents said they would likely cut back on dairy consumption or switch to alternatives like soy or soy milk.

Businesses faced challenges from more demanding customers, but they also presented growth opportunities.

After the Covid dip in April and May, FMCG volumes were just beginning to recover when Saudi Arabia's VAT was last increased to 15% in Q3 2020.

As they stocked up on their favourite brands and categories, consumers were trading up. As a result, a number of categories continued to "recover" in terms of volume; Promos had become more scarce due, in part, to issues with stock and supply.

In many categories, the average price per unit increased. The transfer of VAT to consumers had no immediate effect on volumes across all brands.After a few quarters, FMCG in general saw significantly positive value growth.

SAUDI ARABIA FMCG MARKETTRENDS

One of the biggest global industries is the FMCG (Fast Moving Consumer Goods) or Consumer Packed Goods (CPG) sector. Egypt and Saudi Arabia were the two countries in the Middle East and North Africa (MENA) region with the greatest overall consumer spending on food and non-alcoholic beverages. 

The Gulf Cooperation Council (GCC) benefited from increased sales and earnings in the FMCG sector until recently. The market saw significant GDP growth and rapid population expansion. There were few regulations, targeted subsidies for particular industries, and no taxes like value-added tax (VAT). As a result, there was a period of minimal market competition, with many businesses enjoying respectable growth and favorable profitability.

Saudi Arabia shares characteristics with the other GCC nations, including a young, expanding population and a high GDP. These elements help to sustain consumer demand for dairy goods, juices, and other foods and drinks. The COVID-19 pandemic is lowering the unemployment rate in the kingdom. 

It is anticipatedthat such progress will boost household earnings and consumer expenditure. After the epidemic, it was predicted that the size of the food and beverage business would increase.

The government's emphasis on diversification and food sufficiency is anticipated to be the main factor driving the expansion of the F&B sector over the coming years as economic conditions improve.

Due to problems with the supply chain, more than one third of Saudis surveyed said they had switched to internet shopping. Additionally, customers are thinking about more sustainable and healthful solutions. 

IMPORT TRENDS IN SAUDI ARABIA FMCG MARKET

• Mostly, KSA imports from China the other products but when it comes to consumer goods, they specially imports Tea, Coffee, mate and spices, Salt, Dairy products, Animal, vegetable fats and oils, cleavage products, meat, fish and seafood preparations, Tobacco and manufactured tobacco substitutes which amounts up to $1.03M USD.
• The second largest importer for Saudi Arabia is USA from where they get their Fish, crustaceans, molluscs, aquatics invertebrates around $7.89M, Edible fruits, nuts, peel of citrus fruit, melons $6.35M, Beverages, spirits and vinegar $ 3.06M, Cereal, flour, starch, milk preparations and products, Dairy products, eggs, honey, edible products and Soaps, lubricants, waxes, candles, modeling pastes which amounts up to US$24.15 Billion.
• India is also one of the importers for Saudi Arabia, especially when it comes to food and beverages and personal care in the FMCG sector. Mostly they contribute on cereals, meat and edible meat offal, coffee, tea, mate and spices, vegetable, fruit, nut food preparations, edible vegetables and certain roots and tubers, Cocoa and cocoa preparations, dairy products, meat, fish and seafood preparations, sandalwood and fresh flower  fragrance worth $8.07 Billion.

SAUDI ARABIA FMCG MARKETSEGMENTATION

By Product Type

• Personal Care
• Food & Beverages
• Home Care
• Others

Distribution Type

• Offline
• Online

City Type

• Riyadh
• Jeddah
• Makkah
• Others

SAUDI ARABIA FMCG MARKETCOMPANY PROFILE

• P&G
• Reckitt Benckiser
• Del Monte
• Nestle
• Almarai
• Americana
• Mondelez International, Inc
• Henkel
• IFFCO
• Beiersdorf AG
• Hindustan Unilever Limited (HUL)
• Saudia Dairy and Foodstuff Company (Sadafco)
• Dawn Food Products
• The National Agricultural Development Company (Nadec)

THIS REPORT WILL ANSWER FOLLOWING QUESTIONS OFSAUDI ARABIA FMCG MARKET

1. Cost breakup of a Saudi Arabia FMCG and key vendor selection criteria
2. Market share of Saudi Arabia FMCG market manufacturers and their upcoming products
3. Cost advantage for OEMs who manufacture Saudi Arabia FMCG in-house
4. key predictions for next 5 years in Saudi Arabia FMCG market
5. Average B-2-B FMCG market price in all segments
6. Latest trends in FMCG market, by every market segment
7. The market size (both volume and value) of the FMCG market in 2024-2030 and every year in between?
8. Production breakup of FMCG market, by suppliers and their OEM relationship
9. What are the key factors influencing consumer purchasing decisions in the FMCG sector?
10. What are the predominant distribution channels for FMCG products in Saudi Arabia?
11. How important is e-commerce in the distribution of FMCG products?
12. What are the key regulations and policies affecting the FMCG industry in Saudi Arabia?