GCC F&B Sector: Trends & Outlook
GCC F&B Sector: Trends & Outlook
Research Highlights:
The report examines the F & B market in GCC countries including prospects
for the sector, estimated market growth and market size and online ordering
trends. The report also discusses the COVID-19 impact and evolving
technological advancements that are redefining the F&B landscape
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     Table of Contents
      CHAPTER 1                                                                     CHAPTER 7
07 Executive Summary                                                        34 Global vs Local Players: Who will win?
                                                                                    CHAPTER 8
09
      CHAPTER 2                                                              37 High rentals: Will it spoil the party?
      Industry Overview
                                                                                   CHAPTER 9
     CHAPTER 3                                                               40
12                                                                                 Will Cloud Kitchen trend heads
     Country Overview
                                                                                   up in GCC?
      CHAPTER 4                                                                     CHAPTER 10
26 Top Trends in F&B industry                                                42
                                                                                    Who is buying whom? M&A deals in
                                                                                    F&B Space
      CHAPTER 5
29 Online ordering & Takeaway: A key                                               CHAPTER 11
                                                                            44 Hurdles: The usual and the unusual
   business segment
                                                                               suspects
      CHAPTER 6
33 Immunity Boosting Products – Will                                               CHAPTER 12
                                                                            45 Success story: Talabat Case Study
   the rising trend last long?
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List of Tables
Table 2.1 Restaurants types and key features Table 7.2 Regional QSR and Café chains in GCC
              Country-wise Mobile Subscription &                                      Total Retail Space & Expected Deliveries
Table 4.1                                                             Table 8.1
              Internet Penetration                                                    in million square meters
              Key Players and Revenue Estimates                       Table 10.1      M&A Deals in F&B Sector in GCC
Table 5.1
              (2020)
Table 7.1 Portfolio of family owned Franchises Table 12.2 Talabat Key Information
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List of Figures
              KSA Revenue from Operations                                                  Kuwait F&B Revenue Forecast (in USD
Figure 3.3                                                               Figure 3.10
              Estimates (in USD Millions)                                                  Millions)
              KSA F&B Revenue Forecast (in USD                           Figure 3.11       Average Sales per outlet (USD ‘000s)
Figure 3.4
              Millions)
                                                                                           Oman F&B Revenue Estimates (in
              Average Sales per Outlet – UAE (USD                        Figure 3.12
Figure 3.5                                                                                 USD Millions)
              ‘000s)
              UAE F&B Revenue Estimates (in USD                                            Oman F&B Revenue Forecast (in USD
Figure 3.6                                                               Figure 3.13
              Millions)                                                                    Millions)
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List of Figures
Figure 3.14     Total Food Service Outlets in Qatar                                       GCC Rental Rates change in
                                                                          Figure 8.1
                                                                                          percentage
                Qatar F&B Sales Forecast (in USD
Figure 3.15
                Millions)                                                 Figure 8.2      Retail Vacancy in Major GCC Cities
Figure 4.1      Global Food Chain Outlets
                Unit Economies of Food Delivering                         Figure 10.1     Mergers & Acquisition in GCC nations
Figure 5.1
                Companies in MENA region
                GCC Rental Rates change in
Figure 8.1
                percentage
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Executive Summary
The food & beverage industry is one of the promising sectors in the GCC region and has shown a strong appetite for growth
for a longer period. The Covid-19 pandemic has led to a severe downfall in the industry growth and reduced the demand for
people’s spending. The industry is one among the most affected by Covid-19 due to lockdowns, travel restrictions and social
distancing. The dine-in spending in the region also stands affected. The F&B industry in GCC is different from other regions
where high number of expatriates and young generation define the growth path for the industry. The emerging online culture
of the young, tech-savvy population has pushed the foodservice operators to evolve and adapt. It has become necessary for
businesses to meet the diversified demands of the people. UAE and the Kingdom of Saudi Arabia are the key regions that
contribute to the industry growth and has become pioneers in industry transformation. The region has many global and local
players meeting the rich and varied demands of the consumer market. Chief among the reasons for changing eating patterns
in the region is the emergence of Quick Service Restaurants (QSR) chains such as KFC, Burger King, Pizza Hut and regional
outlets like Herfy, ChicKing that provides high quality foods at an affordable price in faster service. The ongoing pandemic has
changed the behavioural pattern of eating out and the food restaurants are adjusting their business to cloud kitchen and
online delivery to meet the new trends.
The industry has changed its face since the Covid-19 pandemic. Online food ordering and delivery platforms have changed
the way people consume food. The innovation of technology has given power to the consumers to get their favourite foods in
a few minute’s time. Travel restriction and social distancing further fuelled the growth of online ordering platforms. Players
like Talabat, Zomato, FoodonClick have helped businesses to transform operationally to meet the evolving trends. Talabat has
clocked over 4 million monthly visits in April 2021 and average daily orders on an average exceeds 100,000. New business
models like cloud kitchen and Kitchen-as-a-Service model have encouraged all restaurants to meet the increased demand.
Overall, the future outlook for the Food & Beverage industry is expected to be stable. While increasing awareness of health
and convenience of online food ordering could drive market growth.
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Executive Summary
The industry has a wide variety of players from local and overseas. The major QSR share is held by food chains like Herfy,
McDonalds, KFC, Burger King, Pizza Hut and Subway. These six franchises alone have over 2,700 food outlets in the GCC
region. Americana group operates the majority of the franchise chains in the region such as KFC, Hardee’s Krispy Kreme.
The GCC region imports majority of the meat from outside the region and they mostly import meat from Asian and South
American countries. The industry has a certifying body for checking the quality of the meat. International Halal Accreditation
Forum launched in 2016 with 10 founding members has over 35 countries as members now. This body encourages and
facilitates the adoption and implementation of natural standards for food quality.
High supply of retail places has impacted the rental prices. The rental rates have reached the upper level and were falling for
the past few years. The top cities like Dubai, Abu Dhabi, Riyadh and Jeddah are expected to add 1.08 million square meters of
retail space in 2021 in addition to the existing space of 11.6 million square meters. Property owners are offering deep
discounts and offers for attracting and retaining the tenants. The rental rates have fallen approximately 8% in those four cities
in 2020.
In addition to rental rates, the foodservice operators are face challenges in the implementation of Value Added Tax (VAT) for
the products. The implementation of tax is triggered by low oil prices and as a measure to diversify the country’s income
sources. The introduction of VAT may likely impact the consumer’s purchase but it is unlikely to stay hindrance for the long term.
GCC region also benefits from higher living standards that will encourage high consumer spending. Consumers are also
becoming highly selective in their product preferences, comparing quality and price differentials in a holistic manner,
presenting opportunity for retailers. At the same time, investors and operators are increasingly looking to gain market share
by establishing new outlets.
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•   The overall market expenditure of Saudi Arabia on food and beverage is estimated to be more than USD 50 billion in the
    year 2020.
•   KSA is a leading market for QSR chains such as McDonalds, KFC and Pizza Hut and they have 304 stores, 220 stores and
    222 stores. respectively.
• Total restaurant sales of UAE are expected to reach USD 8.9 billion by 2025
•   Kuwait market is the third largest among the GCC nations and the Food & Beverage sector accounts for 1.6% of the non-oil
    GDP
• The Food & Beverage in Oman market is expected to reach the pre-pandemic level of business in the year 2022.
Interested to know more about the GCC Food & Beverage Sector? Find out in our latest report on the sector.
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•   Market-wise Coverage & Analysis: The report provides market wise insights on a range of aspects pertaining to the GCC
    Food & Beverage sector including the pre-pandemic growth trends in each of the GCC markets, the market size before the
    pandemic and expected market size post pandemic, the new business models taking shape in the industry and key positive
    and negative factors impacting the industry.
• Key Data Points: The report presents important data points such as,
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A 360. View
                                                            F & B Industry
                                                              structure
                                      Key pain
                                                                                   Growth drivers
                                       points
                                                             GCC F & B
                                                              Industry
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2,400
2,200
2,000
1,800
1,600
1,400
1,200
               1,000
                        2016    2017   2018E   2019E   2020E   2021F   2022F   2023F   2024F    2025F
• Pre Covid-19 and Post Covid-19 Recovery of Sales per Outlet ( Example: Oman)
                2,500
2,250
2,000
1,750
1,500
1,250
                1,000
                         2016   2017   2018E   2019E   2020E   2021F   2022F   2023F   2024F   2025F
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800
700
600
500                                                                                                                         McDonalds
                                                                                                                            KFC
                                                                                                                            Pizza Hut
400
                                                                                                                            Pizza Hut
300
200
100
  0
           Kuwait             Bahrain              UAE             Saudi Arabia         Oman                Qatar
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