Saudi retail market reaches SR370 billion

The volume of retail market in the Kingdom is exceeding SR370 billion, 44 percent of which is represented by the food sector, or SR160 billion, local media said quoting an expert.
However, expatriate workers are controlling over 70 percent of the retail sector, which puts enormous economic pressures on the country in addition to its adverse impact on food and national security, CEO of al-Othaim Markets Company Yusuf Al-Qifari told Al-Jazeera daily.
With government efforts to correct the status of foreign workers and fight against cover-up business (tasattur), we see a promising opportunity in the Saudi retail market, he was quoted as saying.
He said there are new trends in the retail sector coping with consumer tastes, which are leaning to modern markets, or the so-called modern trade, for the search of diversity and luxury under one umbrella so as to get competitive prices.
This drive requires the injection of investments good enough to set up malls and shopping centers, which will allow investors display their products in a suitable and attractive environment, he said.
He said there are many challenges facing the retail sector, notably cover-up business, presence of irregular workers, high costs of commercial spaces (outlets), shortage of trained manpower, and limited investments in the qualification of national cadres to serve this sector.
Referring to the growth prospects, he said the Saudi retail market is projected to grow by eight percent yearly boosted by a number of factors, including stability, population and urban growth coupled with high purchasing power of customers.
Mohamed al-Ajlan, head of commercial committee at Riyadh Chamber of Commerce and Industry, said the retail sector is divided into organized and non-organized sections.
He said the organized section includes big companies and well-known commercial centers, which are practicing known business, whereas the non-organized section is practicing cover-business activities thus placing enormous economic pressures on citizens and the country as well.
The nationalization (Saudization) of jobs in the retail sector poses key challenges to the decision-makers, he said. In this context, he called on the Ministry of Labor to encourage retail firms, especially owned by the Saudis, to nationalize jobs and implant the culture of work among young Saudis.