Middle East Retail & Hospitality

Delivered July 9th, 2019. Contributors: Daniela B., Edgar M., Vincent J., Varun N. and

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Middle East Retail & Hospitality Outlets 4 - United Arab Emirates

The UAE has about 4,968 clinics, 2170 grocery stores, 1,773 clothing stores, and 1,700 super markets. The estimated number of all requested retail outlets in the United Arab Emirates is presented in the attached spreadsheet.

Grocery Stores
The number of grocery stores range between 1,800 to 2,170 outlets, according to Aiwa and the Etisalat Yellowpages. 
Supermarkets
:There are 1,700 listed super market outlets in the UAE.
Specialty Retailers
There are about 1,528 jewelry outlets in the UAE.
Clothing Stores
In the UAE, there are 1,773 retail outlets listed in the clothing category.
Auto Retailers
There are 954 listed auto dealers in the UAE, of which about 289 are new car retailers and 665 outlets deal in used cars.
Home Furnishing Retailers
There are 907 home furnishing retail outlets in the UAE.
Drug Stores
According to the yellow pages, there are 862 pharmacies in the UAE.
Hospitals & Clinics 
According to the most recent stats released by the government, there are 143 hospitals and 4,968 clinics operating in the UAE.

RESEARCH STRATEGY:We started our research by looking for market research reports about retail outlets in the UAE. We identified credible insights from market reports that covered concepts like revenue, CAGR, total sales, among others; but the identified reports did not feature up-to-date information about the number of stores in the UAE for each category. 

Next, we expanded our research to identify data for each emirate, i.e., Abu Dhabi, Ajman, Dubai, Fujairah, Ras Al Khaimah, Sharjah, and Umm Al Quwain. We were able to locate reports that presented similar information as above, along with some more detailed reports about the leading retail chains; however, once again the most recent number of stores was not available in these reports. Since the previous efforts resulted in good leads, we broadened our research to include information about the Gulf countries. Using this strategy, we found a very detailed report about the retail market in the region (including the UAE), along with some interesting news and outlets, that lead us to a new approach. 

We scoured through official sources, like the Annual Economic Report of 2018 and several reports from the UAE government. We were able to identify the revenue, growth, salaries, but no information about the number of outlets was found. The only information provided was about the number of hospitals and clinics. 
Next, we searched for data that would enable us to triangulate the results, such as population vs. business rate information (X outlets for a Y number of people in the country). Based on the information we had, such as population numbers and demographics, our ideas was to find statistics on the ratio between services/establishments vs. population. We looked for business reports and government sources, including the FCSA; however, the information was not available. 

Further, we tried to find the information in a more creative way, i.e., by looking for comparisons between the emirates, trying to find statements like “Dubai has X clothing stores while Abu Dhabi has Y”, taking into consideration the tourism aspect of the UAE, we performed this search in different news and travel sources as well as local and global business news sites, but we were not successful in our endeavor. 

In a final effort to determine the number of outlets for each category, we turned to the UAE business directories like the Official Etisalat Yellow pages — Free Online Business Directory in UAE and Aiwa. These particular sites were chosen because they are specifically focused on the UAE business. It is essential to consider that it is not possible to verify if every outlet in the UAE is listed, especially when it comes to small outlets.
 We were able to identify the number of retail businesses for each category with this approach. Lastly, a detailed report about the retail market in the UAE was identified in our research but is available behind a paywall.

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Middle East Retail & Hospitality Outlets 3 - Saudi Arabia

In Saudi Arabia, there are 43,987 grocery stores and 6,147 drug stores. Unfortunately, no information is available on the number of clothing stores and home furnishing retailers in the public domain. On the attached spreadsheet in rows 2-9, column B, information on other retail outlets, broken down by sector, can be found. 

FINDINGSThe number of grocery stores is 43,987.
The number of supermarkets is 1,255.
The number of specialty retailers is 11,629.
The number of auto retailers 462,293.
The number of drug stores 6,147.
The number of hospitals & clinics is 3,981.

RESEARCH STRATEGYWe began our search by looking for the number of retail outlets in the assigned category. This led us to the publicly-available information from the General Authority of Statistics and surveys that gave us figures for the number of grocery stores, supermarkets, specialty retailers, auto retailers, hospitals and clinics, and drug stores. Unfortunately, we were unable to find the number of clothing stores and home furnishing retailers.

From this point, we focused on finding this information for clothing stores and home furnishing retailers. We searched government websites, industry publications, and articles, for licenses issued for these services, we found more information on the topics but it regarded general trends and could not help us triangulate the total number of clothing stores nor the number of home furnishing retailers.

Next, we attempted to estimate the number of clothing stores by finding the companies and key players in the textile industry. Although we found several of them, they were unable to give us any useful data as the number of outlets they have in Saudi Arabia were very few. We applied the same strategy for the number of home furnishing retailers. We did this by looking at companies that sell furniture in Saudi Arabia. This did not work as most of the companies we found were online retailers.  Thus, we could not use this methodology to triangulate the number of clothing stores and the number of home furnishing retailers. Our research shows that this information is only available through paywalled reports.

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Middle East Retail & Hospitality Outlets 2 - United Arab Emirates

The estimated total number of hospitality outlets in the United Arab Emirates (UAE) is 17,124. On the attached spreadsheet in column C, rows 10-16, the number of outlets, broken down by the sectors can be found.

Food & Beverage Sector: Total Number of OutletsAccording to Anurag Bajpai, KPMG Lower Gulf's Partner and Head of Retail, there were a total of 16,234 food and beverage outlets in 2017 and this was projected to increase to 19,053 by 2020. 
In 2018, the estimated number of food and beverage sector outlets in the United Arab Emirates was 17,124 outlets. (see calculations below)
According to a report by Agriculture and Agri-Food Canada, the consumer food service and food and beverage sector outlets in the UAE in 2013 were in total 5,818 outlets, which includes 1,631 cafe's/bar outlets, 1,615 full-service restaurant outlets, 2,325 fast food/quick-service restaurant outlets, and 113 street stalls/kiosks. 
The growth rate (CAGR) of UAE food and beverage outlets from 2013-2017 was 29.24% CAGR. (see calculations below)
The projected growth rate (CAGR) of UAE food and beverage outlets from 2017-2020 is 5.48%. (see calculations below)

Distribution Among SectorsThe total number of QSR/fast food restaurant outlets in the UAE in 2018 is estimated to be 6,843 outlets. (see calculations below)
The total number of fast food (street stalls/kiosks) outlets in the UAE in 2018 is estimated to be 332 outlets. (see calculations below)
The total number of full-service restaurant outlets in the UAE in 2018 is estimated to be 4,753 outlets. (see calculations below)
The total number of bar & cafe outlets in the UAE in 2018 is estimated to be 4,799 outlets. (see calculations below)
There are over 50 catering & food delivery company outlets in the United Arab Emirates. 
There are 726 hotel outlets in the United Arab Emirates, according to Federal Competitiveness & Statistics Authority report. These hotel outlets are distributed as follows: 175 5-star hotels, 196 4-star hotels, 305 3-star hotels, 21 2-star hotels, and 29 1-star hotels. 
There are 332 other lodging facilities which include hotel apartments in the UAE, according to the Federal Competitiveness & Statistics Authority report. These hotel apartments have different classes and are distributed as follows among the classes: 90 Deluxe, 56 Superior, and 186 Standard Class hotel apartments. 

RESEARCH STRATEGYWe first searched for readily available data on the number of hospitality outlets broken down into quick-service restaurants, fast food restaurants, restaurants, catering & food delivery, hotels, other lodging facilities, and cafes & bars in the UAE, by searching through UAE government websites (such as the UAE Government Portal, UAE Ministry of Economy, and UAE Federal Competitiveness and Statistics Authority, among others). We found a report from the UAE Federal Competitiveness and Statistics Authority which provided us with information on the UAE's total number of hotels and other lodging facilities. Other than that, we only found annual reports, economic reports, and consumer price index reports of restaurants, cafes and other outlets from the food and beverage sector, which were not relevant to address the request. 

We then changed our strategy by triangulating the requested information. We searched for information that we could use to triangulate the requested information, such as the total number of food and beverage sector outlets or industry growth rates. We used industry reports on the UAE from international and global organizations (such as the USDA Foreign Agricultural Services — Global Agricultural Information Network (GAIN), Glee Hospitality, Euromonitor International, KPMG, European Union, and Agriculture and Agri-Food Canada, among others), statistics databases (such as Statista); market reports (from sources such as Market Research), and business media sources (such as Gulf Business, Arabian Business, Caterer Middle East, and Khaleej Times, among others). We found information on the total number of food and beverage outlets for 2017 and the projected number of outlets for 2020, from Khaleej Times. We also found a "Foodservice Profile" report of the United Arab Emirates by Agriculture and Agri-Food Canada, which contains historical information on the total number of food and beverage outlets and on individual sectors such as cafe's/bars, full-service restaurants, quick-service restaurants, and street stalls/kiosks. Furthermore, we found catering & food delivery information from an Euromonitor International paywalled report. The paywalled reports from Euromonitor further contain information on full-service restaurants, fast food, cafe's/bars, street stalls/kiosks, lodging, contract foodservice, and 100% home delivery/takeaway, and should contain the total number of outlets, according to the Table of Contents. We combined the information and data found from these two sources and calculated the total number of food and beverage outlets, cafe's/bars, full-service restaurants, quick-service restaurants, and street stalls/kiosks outlets in the UAE in 2018. 

Based on the Agriculture and Agri-Food Canada report and the KPMG report we found that quick-service restaurants are more popularly known as fast food restaurants. The data for fast food restaurants from the Agriculture and Agri-Food Canada report includes KFC and McDonald's, which can be considered examples of quick-service restaurants. Therefore, we used data on fast food restaurants for quick service restaurants.

For the "fast food restaurant" sector, we used the data on "street stalls/kiosks" from the Agriculture and Agri-Food Canada report, which are included in the definition of fast food restaurants.

We further assumed that the "Full-Service Restaurant" category best fits the category "restaurant" and used information from this category from the Agriculture and Agri-Food Canada report.

CALCULATIONS:

Projected Growth Rate (CAGR) of UAE Food & Beverage Outlets from 2017-2020:

Number of food & beverage outlets in 2017 = Initial Value = 16,234; 
Projected food & beverage outlets in 2020 = Final Value = 19,053; 
Total Number of Years/Period = 2020-2017 = 3 years/period
Growth Rate (CAGR) = (Final Value / Initial Value) ^ (1/Years) - 1 = (19,053/16,234) ^ (1/3) - 1 = 5.48%


Growth Rate (CAGR) of UAE F&B Outlets from 2013-2017:

Number of food & beverage outlets in 2017 = Final Value = 16,234; 
Number of food & Beverage outlets in 2013 = Initial Value = 5,818; 
Total Number of Years/Period = 2017-2013 = 4 years/period;
Growth Rate (CAGR) = (Final Value/Initial Value) ^ (1/Years) - 1 = (16,234/5,818) ^ (1/4) - 1 = 29.24%


Total F&B Outlets in the United Arab Emirates, 2018:

To calculate the total number of food and beverage outlets in the UAE, we used the growth rate of 5.48%.
Projected CAGR from 2017-2020 = 5.48%; 
Number of food & beverage outlets in 2017 = Initial Value = 16,234; 
Number of Periods (Years) = t = 2018–2017 = 1 year/period 
Total number of food & beverage outlets in the UAE = Final Value = (Initial Value) (1 + CAGR) ^t = (16,234) (1+5.48%) ^1 = 17,123.62 = 17,124


Quick-Service Restaurants, Total Number of Outlets in 2018:

To calculate the total number of outlets of quick-service/fast food restaurants in the UAE for the year 2018, we used the growth rate of 5.48% for the years 2017-2018 and the growth rate of 29.24% for the years 2013-2017.
Total number of quick-service/fast food restaurant outlets in 2013 = 2,325; 
CAGR 2017-2018 = 5.48%; 
CAGR 2013-2017 = 29.24%; 
Number of periods or years (2013-2017) = t1 = 2017 – 2013 = 4; 
Number of period or years (2017-2018) = t2 = 2018-2017 = 1;

Total number of QSR/Fast Food Restaurant outlets in 2017 = (Final Value) = (Initial Value) (1 + CAGR) ^t1 = (2,325) (1+29.24%) ^4 = 6,486.50 = 6,487 outlets. 

Total Number of QSR/Fast Food Restaurant outlets in 2018 = Final Value = (Initial Value) (1 + CAGR) ^t2 =(6,487) (1+5.48%) ^1 = 6,842.49 = 6,843


Fast Food (Street Stalls/Kiosks), Total Number of Outlets in 2018:

To calculate the total number of outlets of fast food (street stalls/kiosks) outlets in the UAE for the year 2018, we used the growth rate of 5.48% for the years 2017-2018 and the growth rate of 29.24% for the years 2013-2017.
Total number of fast food (street stalls/kiosks) outlets = 113; 
CAGR 2017-2018 = 5.48%; 
CAGR 2013-2017 = 29.24%; 
Number of periods or years (2013-2017) = t1 = 2017 – 2013 = 4; 
Number of period or years (2017-2018) = t2 = 2018-2017 = 1;

Total number of fast food (street stalls/kiosks) outlets in 2017 = Final Value = (Initial Value) (1 + CAGR) ^t1 = (113) (1+29.24%) ^4 = 315 outlets.

Total number of fast food (street stalls/kiosks) outlets in 2018 (Final Value) = (Initial Value) (1 + CAGR) ^t2 =(315) (1+5.48%) ^1 = 332 outlets.


Full-Service Restaurants

To calculate the total number of outlets of fast food (street stalls/kiosks) outlets in the UAE for the year 2018, we used the growth rate of 5.48% for the years 2017-2018 and the growth rate of 29.24% for the years 2013-2017.
Total number of full-service restaurant outlets in 2013 = 1,615; 
CAGR 2017-2018 = 5.48%; 
CAGR 2013-2017 = 29.24%; 
Number of periods or years (2013-2017) = t1 = 2017 – 2013 = 4; 
Number of period or years (2017-2018) = t2 = 2018-2017 = 1;

Total number of full-service restaurant outlets in 2017 = Final Value = (Initial Value) (1 + CAGR) ^t1 = (1,615) (1+29.24%) ^4 = 4,505.68 = 4,506 outlets. 

Total number of full-service restaurant outlets in 2018 = Final Value = (Initial Value) (1 + CAGR) ^t2 =(4,506) (1+5.48%) ^1 = 4,752.93 = 4,753 outlets


Bars & Cafes

To calculate the total number of outlets of Bars & Cafes in the UAE for the year 2018, we used the growth rate of 5.48% for the years 2017-2018 and the growth rate of 29.24% for the years 2013-2017.
Total number of bars & cafe outlets in 2013 = 1,631; 
CAGR 2017-2018 = 5.48%; 
CAGR 2013-2017 = 29.24%; 
Number of periods or years (2013-2017) = t1 = 2017 – 2013 = 4; 
Number of period or years (2017-2018) = t2 = 2018-2017 = 1;

Total number of Bars & Cafe outlets in 2017 = Final Value = (Initial Value) (1 + CAGR) ^t1 = (1,631) (1+29.24%) ^4 = 4,550.32 = 4,550 outlets.

Total number of bars & cafe outlets in 2018 = Final Value = (Initial Value) (1 + CAGR) ^t2 =(4,550) (1+5.48%) ^1 = 4,799.34 = 4,799 outlets.

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Middle East Retail & Hospitality Outlets 1 - Saudi Arabia

There are 7,479 accommodation establishments, 25,854 restaurants, and 8,798 cafes in Saudi Arabia. Category wise statistics of the number of establishments has been populated in the attached spreadsheet.
FINDINGSQuick-Service Restaurants: 2,792 
Fast Food: 14,553
Restaurants: 25,854 
Catering & Food Delivery: N/A
Hotels: 2,354 
Other Lodging Facilities: 5,125
Bars & Cafes: 8,798 
RESEARCH STRATEGYIn order to fulfill this request, we searched for the number of QSR, fast food, restaurant, catering & food delivery, hotels, other lodgings, and bar/cafe establishments in Saudi Arabia on the General Authority for Statistics, Saudi Arabia website. The economic survey of institutions data made available by the Saudi Arabia government on its website is limited to broad industry classifications. For example, data for the food and beverage sector (code 56) has been provided but data for sub-categories like fast food (code 561031) and cafes (code 562903) has not been published. However, we were able to find the latest Saudi Commission for Tourism & National Heritage data (2018) for hotels and other types of lodgings published on the General Authority for Statistics, Saudi Arabia website. The total number of accommodation establishments in Saudi Arabia is 7,479 and the number of hotels is 2,354; therefore, the number of other lodging facilities is 5,125 (7,479-2,354).

Next, we searched research reports for the information we were unable to find. We found a few reports as recent as 2018 and 2017 that provide the number of restaurants and cafes; however, these reports had dated information. Al Masah Capital has published annual reports on the food service sector in Saudi Arabia in both 2017 and 2018; in both reports, the agency uses 2015 data. Similarly, a report published by Macrothink Institute in 2018 has published 2014 data. Given that the required information was not available on the General Authority for Statistics, Saudi Arabia website and the fact that data published in the last two years is only as recent as 2015, we have provided the 2015 data for QSRs, fast food, restaurants, and bars/cafes. The number of restaurants provided is the collective number of fast-food restaurants and full-service restaurants.

Having looked for precompiled information and not found the same, we attempted to triangulate the data. Fast-food restaurants make up approximately 42% (14,553/ 34,652) of all restaurants and cafes in Saudi Arabia and 45% (3,424/ 7.603) in the UAE. Cafes make up 25% (8,798/34,652) of all restaurants and cafes in Saudi Arabia and 27% of all restaurants and cafes in the UAE. Given that the proportion of cafes and fast-food restaurants is not significantly different in the two countries, we assumed that the proportion of QSRs in both countries will be the same. The number of home delivery/ takeaway, street stalls/ kiosks, and self-service cafes (QSRs) in UAE is 276, and the number of fast food restaurants is 3,424. Therefore, the ratio of QSRs to fast food restaurants is 8.06/100 in UAE, and the number of QSRs in Saudi Arabia is 2,792 (8.06%*34,652). We attempted the same strategy for food catering and delivery services in Saud Arabia; however, we found that catering services in Saudi Arabia "account for a larger share of the distribution market in Saudi Arabia
 than in comparable markets".

Did this report spark your curiosity?

Sources

From Part 01

Quotes

"In the UAE, supermarkets had the largest market share as of 2017, accounting for 49.2% of sales, dominated by operators such as the Lulu Group (6.01% market share), Carrefour (4.08% market share) and Spinneys (1.98% market share)"