Sami bin Ibrahim Al-Husseini, Governor of Small and Medium Enterprises General Authority
The Kingdom’s Franchising Market Offers Over 10,000 Business Opportunities.
Saudi Arabia’s franchising landscape is experiencing unprecedented growth, with more than 1,200 brands now poised for franchising opportunities, according to a recent report by Monshaat, the Small and Medium Enterprises General Authority. The report highlights that the Kingdom’s dynamic franchising market offers over 10,000 business opportunities, making it an attractive prospect for entrepreneurs and investors alike.
Among these brands, over 1,000 are well-established, including 380 local brands and more than 600 international franchises. These franchises are spread across key sectors such as food and beverage (F&B), retail, services, and other high-growth industries. The availability of such diverse franchising options underscores Saudi Arabia’s potential as the franchising hub of the Middle East.
A Thriving Franchise Market in the Kingdom
Saudi Arabia has become a prime destination for global brands, spurred by its Vision 2030 initiative. This economic diversification strategy has opened up significant investment opportunities and triggered a surge in the number of foreign franchises entering the market. The favorable economic environment, robust legal framework, and strong consumer demand have attracted numerous international players looking to expand in the region.
The franchising market in Saudi Arabia benefits both international and local investors. For international brands, franchising presents an opportunity to gain a foothold in one of the largest economies in the Middle East. For local entrepreneurs, franchising offers a proven business model to enter competitive industries with reduced risk.
Key Sectors for Franchise Growth
The food and beverage (F&B) industry is one of the primary drivers of franchising growth in Saudi Arabia. Global giants like McDonald’s, Starbucks, and KFC have already established strong presences in the Kingdom, and many other international brands are following suit. In addition, Saudi-born brands such as Al Baik and Barn’s Café have also capitalized on the growing market by expanding their franchising networks both locally and regionally.
Retail and service sectors are also experiencing significant franchising momentum. Retail franchises, spanning fashion, electronics, and lifestyle brands, continue to thrive in the Saudi market. Services such as healthcare, education, and fitness centers have also embraced the franchising model to expand their footprint.
Vision 2030 and the Franchising Boom
Saudi Arabia’s Vision 2030 has provided the necessary catalyst for the Kingdom’s franchising boom. With a focus on reducing reliance on oil, Vision 2030 has prioritized investment in sectors such as retail, services, and entertainment, aligning with the needs of global and local franchisors. These reforms have not only attracted global franchises but have also encouraged local brands to pursue expansion through the franchising model.
One of the critical steps in promoting franchising was the implementation of executive regulations for the franchise system in 2020. This regulatory framework has simplified the entry of global franchises into the Saudi market and facilitated investment opportunities for Saudi entrepreneurs. The Saudi franchising law aims to foster transparent relationships between franchisors and franchisees, ensuring legal protections and creating a stable environment for business growth.
The Franchising Center: Supporting Saudi Brands
The Franchising Center, operating under Monshaat, plays a crucial role in supporting and promoting franchising in the Kingdom. As part of its mission to empower local brands and entrepreneurs, the center provides vital services such as assessing brands’ readiness for franchising, licensing brokers, offering mediation services, and appointing franchise managers to guide businesses through the process.
With an ambitious vision, the Franchising Center aims to position Saudi Arabia as a regional and global hub for both local and international franchise brands. Its programs help small and medium enterprises (SMEs) navigate the franchising process, providing operational support and expert guidance to foster long-term growth.
The center’s support extends beyond just franchising. It is actively involved in ensuring that Saudi brands are equipped to scale domestically and internationally, creating opportunities for new entrepreneurs to thrive in a competitive market.
Job Creation and Economic Growth
Franchising in Saudi Arabia is expected to have far-reaching economic benefits, including substantial job creation. As more brands establish franchises across the Kingdom, the demand for skilled labor in various sectors will increase, providing new employment opportunities. In the short, medium, and long term, franchising is projected to contribute significantly to the growth of fast-growing industries such as F&B, retail, and services.
Although franchising is still a relatively new phenomenon in Saudi Arabia, it has shown remarkable potential for growth. As the number of active franchises increases, the sector will continue to evolve, creating a more vibrant and competitive business environment.
Saudi Arabia’s franchising market is poised for tremendous growth, with over 1,200 brands ready for franchising and more than 10,000 business opportunities available. The Kingdom’s commitment to supporting both local and international brands, combined with favorable market conditions, makes it a hotbed for franchise investment. As global and local brands continue to expand, franchising is set to play a pivotal role in Saudi Arabia’s journey towards economic diversification and job creation.
