SAUDI ARABIA – The Ministry of Commerce has revealed an 866% surge in franchise registrations in the past 3 years, a reflection of the growth and potential of the hospitality and tourism, sector in the country.
Franchise registrations in Saudi Arabia surged to 1,788 by the end of the third quarter of 2024, a significant increase from just 185 registrations in the fourth quarter of 2021, as reported by the Ministry of Commerce on November 25.
The tourism, hotels, and restaurant sectors led the growth, with 1,232 franchise registrations, followed by the wholesale and retail sector with 689, and the transport and storage sector with 257.
In 2024, several major restaurant franchises have expanded into Saudi Arabia. Chipotle Mexican Grill, known for its customizable Mexican fare, is now serving local demand for such cuisine.
Panera Bread, a bakery-café chain with a focus on healthy meals, also entered the market.
Additionally, Wendy’s re-established its presence, tapping into the competitive fast-food sector. Other notable entries include Bonefish Grill, a seafood restaurant, and Carrabba’s Italian Grill, known for authentic Italian dining.
These openings reflect Saudi Arabia’s growing appetite for global dining options in line with the country’s Vision 2030 plans to enhance its hospitality sector.
Regionally, Riyadh recorded the highest number of franchise registrations, with 647, followed by Makkah with 363, and the Eastern Province with 225 registrations.
The Ministry highlighted that the issuance of the Franchise Law and its executive regulations in 2019 and 2020 has played a crucial role in promoting franchise activities.
These regulations have established a clear regulatory framework between franchisors and franchisees, enhancing transparency and fostering growth in the sector.
Additionally, the Franchise Center, operated by the Small and Medium Enterprise General Authority (Monsha’at), has been instrumental in supporting entrepreneurship.
The center works to promote franchise culture, attract investment, and create new job opportunities, all in alignment with Saudi Arabia’s Vision 2030.
Global franchises have been present in Saudi Arabia since 1970, significantly influencing the Kingdom’s economic and cultural landscape. Monsha’at reports that over 380 Saudi companies now operate franchises across the Kingdom and are expanding into other GCC countries.
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