Retail Structures MENA

Part
01
of five
Part
01

Industry Analysis; Retail Market - Algeria

Retail in Algeria is seeing continued growth. The sector is highly fragmented with 95% of the sector controlled by private businesses.

RETAIL IN ALGERIA CONTINUES TO GROW

NUMBER OF LARGE STORES ARE INCREASING IN ALGERIA

  • Large shopping malls are continuing to spring up in Algeria such as the Oran shopping mall. Their presence is contributing to the growth of the retail segment in the country.
  • A growing number of people prefer to shop once a week in hypermarkets compared to visiting the traditional retail stores in the neighborhood on a daily basis.
  • In 2009/2010 Algeria passed several laws that required that 51% ownership of all foreign investments must be Algerian.
  • This has made it difficult for large stores and hypermarkets like Carrefour to expand.
  • In 2016 (according to the Algerian Register of Commerce), Algeria had 1415 retail markets, 38 of these being hypermarkets and 232 supermarkets.
  • The largest conglomerate in Algeria is known as UNO. The company has 23 stores in the country, 5 of these being hypermarkets, 1 supermarket and 1 convenience store.
  • UNO is the brand name of Numidis, Algeria's largest conglomerate.c

INFORMAL SHOPS AND DIRECT SELLING ARE POPULAR IN ALGERIA

  • Informal shops dominate the retail market in the country.
  • Private businesses in Algeria control 95% of the retail trade, with a strong presence of European investors.
  • Private business are mainly owned by shopkeepers of informal shops.
  • The state and state-owned firms sell imported foodstuffs, industrial supplies and pharmaceuticals as well as supplies.
  • The majority of distributors are also informal shopkeepers, working from small shops across the country.
  • Direct selling is expected to see substantial growth over the next few years.
  • Growth in this route is set to be due to the increase of the younger population of consumers and agents who have driven the use of technological tools that contribute to companies' growth.
  • Technological strategies such as managing orders through mobile devices and digitizing catalogs will also increase in prominence.
  • Algerians enjoy direct selling due to the fact that they have products delivered straight to their homes.
  • They, however, prefer to purchase homeware and home furnishing products directly from the retailers.

INTERNET SELLING IS GAINING POPULARITY

  • Internet selling is still small in the country.
  • However, the sector is expected to grow due to the growth of internet usage and the new reforms in the legal and banking sectors in the country.
  • The ecommerce market in the country is still growing, however, it is still relatively small compared to the ecommerce market in countries like Egypt and Morocco.
  • The country does not have any official figures on the market but the market's potential is said to be $5 billion.
  • The leading internet sellers in the country are Zawwali, Batolis and Dzboom.
  • 2018 laws on online selling in the country state that online stores have to host their websites in Algeria and should be registered in the country's commercial register.
  • The country's law also does not allow the purchase of goods from outside the country and the government does not intend to open emarketing for foreigners.
  • Intermediary companies offer citizens access to goods on sites such as Amazon and Aliexpress.
  • 6% of the country's population, that is 2.45 million, had shopped online by 2017.

BEAUTY PRODUCTS ARE MOST POPULAR IN THE DIRECT SELLING SECTOR

Part
02
of five
Part
02

Industry Analysis; Retail Market - Tunisia

The competition in the retail market in Tunisia is protected by its government as they set regulation to forbid foreigners to enter the market without a joint venture with local marts.

OVERVIEW OF TUNISIA'S RETAIL MARKET

  • Tunisia is dominated by small shops as estimated by the export.gov website. There are over 210,000 neighborhood grocery shops scattered throughout the country, while Oxford Business estimated the number of over 250,000 small shops and they account for 80% of the sector's turnover.
  • The small shops predominately located in rural areas. One shop is on average 20 to 50 sq. meters with an average of 100 food items carried.
  • While in urban areas, Tunisia has a "souq" (outdoor market) selling perishable items. These places are crowded by local traders and farmers.
  • The modern distribution channels represent 20% of the Tunisian retail sector. The GOT said that one of their goals is to increase the modern distribution channel to 50% in the coming years.
  • In the 2011 revolution, many supermarkets were destroyed but the sector has rapidly recovered showing double-digit growth, brought about by the acceleration of new retail property, the 300,000 high-income Libyan migrants and a gradual shift in consumption patterns.
  • The total retail sector turnover is about TD3 billion (€1.3 billion) in 2016 and only contributes 3% to GDP.
  • The retail landscape in Tunisia is affected by some factors, including a population of 11.3 million as of July 2016 with a growth rate of 1.8% annually.

Frequency of Large Stores


Routes to Market

  • Ninety percent of Tunisia’s foreign commercial trade is conducted by sea.
  • There is a challenge to Tunisia retail market as Tunisian law does not allow wholesale or retail marketing by foreign businesses. The GOT says that every joint venture with a foreign investor is considered an exception subject to a license dependent on the advantages of the project to the Tunisian economy.
  • The government legislation is designed to protect smaller businesses from such competition and limits the number of hypermarkets authorized in a specific area.
  • To open hyper/supermarkets, a foreigner must set up under joint ventures, with France's Carrefour and Casino groups (Géant and Monoprix).

Consumers in Tunisia

  • Small shops are many as most Tunisians only visit larger outlets just once or twice per month and they buy food items on a daily basis in nearby grocery stores.

E-Commerce in Tunisia

  • The sales volume of e-commerce is still quite low in Tunisia, but shows steady development in recent years, fostered by widening access to banking services and the internet.
Part
03
of five
Part
03

Industry Analysis; Retail Market - Kuwait

The estimated total retail space in Kuwait reportedly exceeds 770,000 sq. m (2017). Its organized segment is enhancing its penetration, expanding the total retail supply to about 890,200 sq. m.

Retail landscape and structure

  • In the next four years, Kuwait’s retail industry is expected to expand at a CAGR of approximately 4.2%, which would represent an increase from 2012 to 2016 (0.6%). This increase will primarily be driven by growth in tourism activity.
  • The Ministry of Commerce and Industry (MoCI) is responsible for regulating Kuwait's retail sector, and its chief objectives include promoting the country's industrial and commercial activities, supplying a "standard of consumer support for services and goods. The nation's retail industry expanded considerably because of the solid demand for both imported and luxury commodities by foreign citizens, who comprise about 70% of its population and opulent locals enjoying per capita yearly incomes of around $68,500 (2017).
  • A trend that is anticipated to persist in 2019 involves modifying the market locally with innovative shopping centers and growing competition stemming from e-commerce retailers.
  • In the second quarter of 2019, shopping mall GLA amounted to 702,000 square meters, which consists of eight properties that already exist, as well as three pipeline development operations scheduled to be finished in 2021. The average mall occupancy level across existing stock in 2019 reached 93%, while around half (50%) of the operating supply were observed to present a GLA of 10,000 to 40,000 square meters. These figures indicate a growing concentration on alternative entertainment and leisure, which usually occupy bigger spaces that are leasable than traditional F&B or apparel fashion retailers.
  • In Kuwait, the estimated value of retailing (non-store) is projected to rise by 48%.
  • As of 2017, the total retail space in Kuwait is estimated to exceed 770,000 sq. m, and the organized segment is increasing its penetration raising the total retail supply to about 890,200 sq. m of GLA. Kuwait is anticipated to experience added space driven by the emergence of shopping complexes and malls, along with smaller independent developments. A few important retail operations are the Gate Mall Company's second mall, Tamdeen Development (Al Khairan), Salhiya Retail Mall (Kuwait City), The Avenues Phase IV, and the renovation of Al Manshar.
  • The modern retail market in Kuwait is largely fragmented with local players and private operators. The local players, such as The Sultan Center and Kuwaiti Union of Cooperative Societies, still maintain the largest market share.
  • The Avenues Mall, which is one of the chief properties, serves as the country's the largest mall, and it is under development through four separate phases and expected to cost about USD $2 billion. It has a reported GLA of around 270,000 sq. m, and it is currently in the final construction phase that is going to add 95,000 sq. m. Additional major retail spaces are the Al Hamra Luxury Centre (24,000 sq. m), Marina Mall (35,379 sq. m), and 360 Kuwait (82,000 sq. m).

Route to market

  • The typical route to market in Kuwait for foreign businesses involves applying as a Foreign Direct Investment company, which requires an investment committee approval. This action empowers foreign investment in certain sectors. Another route is as a Limited Liability Company (WLL) that restricts the liability of investors "to the extent of their investment."
  • Being a Kuwait Shareholding Co. (KSC) is another typical route, and it involves a joint stock company opening to foreign investors, however, having shareholders from Kuwait is a requirement (foreigners can own a maximum of 49%). The final route to market is through Joint Venture, and it enables investors to collaborate with third parties.
  • For foreign entities, Kuwait corporate income taxes amount to 15%. In 2021, a value added tax of about 5% could be included. In the Kuwaiti market, businesses must promote, distinguish, and develop a local account executive, representative, or agent, representative to handle the company and product marketing strategy in order to be prosperous.
  • Maintaining "a Kuwait joint-venture partner" can be more beneficial than an agent and previous successes in alternate GCC nations prior to entering the country is valuable. However, in such markets, corporations depend on local expertise to conduct their business since if they lack a skilled local business partner or agent, comprehending rules and the overall business framework is complicated.
  • The U.S. embassy recommends that American corporations entering into the nation obtain a competent representative possessing the necessary knowledge, along with contact from the sector they desire to enter. Acquiring proficient local legal counsel to create a deal that safeguards a business from liability in the future is vital, and the best partner for a corporation seeking to enter Kuwait is one that is going to share the company's losses and profits.

Frequency of large stores in the retail market of the country

  • According to the Oxford Business Group, "The penetration of large modern grocery stores in Kuwait is low, with the top-five large food retailers Sultan Centre, the Kuwaiti Union of Consumer Cooperative Societies, City Centre, Carrefour, and Géant Casino comprising only 10% of the market."
  • In Kuwait, the market penetration rate of modern hypermarkets and supermarkets is rather low (45%). Nevertheless, rising growth in hypermarket and supermarket penetration is forecasted. The larger retailers have experienced difficulty entering the market. Meanwhile, cooperatives, which are developed through the idea of individual contribution and supported by subsidies from the government, are dominating and maintain a customer base that is loyal and solid.
  • An increasing population base (e.g., a substantial proportion of youth), combined with a high GDP (PPP) per capita of at least USD $59,766 and rapid urbanization has strengthened the development of the country's organized retail market. These demographics have facilitated international luxury retail labels, such as Christian Dior, Chanel, Burberry, Prada, and Louis Vuitton to build a presence in Kuwait.
  • Recently, the market has become more competitive as large operators of hypermarkets/supermarkets are supplying enhanced products, which has encouraged many local cooperatives to offer discounts on their items to draw consumers.

Research Strategy:

To determine which routes to market are the most used and popular, we initially searched through Kuwait's government websites such as its Statistical Bureau and the Ministry of Commerce and Industry. However, we could not locate the requested data. We then explored media sources like Arabian Business and Saudi Gazette, as well as market reports from the Oxforb Business Group and the GCC retail industry from Apppen Capital. Again, we were still unable to locate the required information.

Next, we decided to broaden our search to foreign companies entering into the retail industry and observed some general information on the U.S. export website. We also found the typical route to market in Kuwait for U.K. companies on the Startup Overseas site. Nonetheless, information on the most popular route was not available. We did discover that American companies were advised that it is best to obtain a representative prior to expanding into Kuwait. Additionally, we found out that some companies found that having a Kuwait joint-venture partner was a better tactic than having an agent or representative.
Part
04
of five
Part
04

Industry Analysis; Retail Market - Egypt

Traditional retailers represent 80% of the retail market share, and eCommerce for only account 0.4%. Egyptians highly accept the U.S. products and the demand is driven by the higher-income consumers in Egypt. Below is our deep analysis.

OVERVIEW OF RETAIL SECTOR IN EGYPT

  • According to Gain report in 2018, the retail industry in Egypt is expected to grow with 15% -20% in the coming five years.
  • In 2017, Egypt had a population of 97 million with a GDP of US$237.07 billion, therefore, the GDP per capita was USD 12,537 PPP.
  • The population growth rate in Egypt is 2.6 percent per annum, but the growth rate in Egypt's retail sector is 36 percent per annum, making it appealing for Lulu to enter the market.
  • The retail food sector in Egypt is estimated to be $24.7 billion.
  • The Egyptian market is dominated by traditional outlets, this is, 98.7 percent of the total outlets and around 80 percent of the total sales are generated by traditional outlets.
  • Egypt has an estimated 115,000 traditional grocers, many of these stores are located in urban centers.
  • Two modern supermarket chains, Turkish BIM and Egyptian Kazyon, see that Egyptians still like traditional grocers, so they set up small stores for them, however, the modern outlets are also growing in number and sales volume.
  • Online retail platforms are also getting popular due to higher internet penetration.
  • Egypt faced high inflation since November 2016 currency devaluation. Now the upward price pressures slow down the growth of the retail market, hence, creating a higher demand for products.
  • In 2017, Egypt imported consumer products worth $ 2 . 6 billion from the following countries; Brazil, Kenya, India, New Zealand, and the United States. Brazil accounted for 62% of the imported products that entered Egypt in 2017.
  • Egyptians highly accept U.S. products.

Consumer Profile of Retail Sector in Egypt

  • According to Nihal El Koussi, Managing Director, Nielsen Egypt & Levant, "Since 2016, inflation has reduced by 30%, hence, the volume of sales is growing".
  • During inflation, 2016-2017, the Egyptian consumers with a higher -income were less impacted and still preserved the consumption, while the mid to low -income buyers changed their consumption patterns during the hard times.
  • The higher income consumers like imported products and they drive the demand for imported products, while the middle and lower income consumers prefer domestic products.
  • As the inflation reduces, the retail sector in Egypt is witnessing a huge growth being fueled by the affluent Egyptians, therefore, malls such as Cairo Festival City are setting luxury styles to cater for higher-income shoppers.

Frequency of Large Stores in Egypt

Modern retail channels, such as supermarkets, hypermarkets, and convenience stores have 1,500 outlets in total and represent around 20 percent of total retail sales in Egypt. The top retailers in Egypt are;
  • Carrefour (Supermarket/Hypermarket) with 24 outlets selling domestic & imported goods.
  • Mansour (Group Retail/Distribution) with 102 outlets selling domestic & imported goods.
  • Seoudi (Retail) with 12 outlets selling domestic & imported goods.
  • On-the-Run (Convenience Store) with 27 outlets selling domestic & imported goods.
  • HyperOne (Retail) with 2 outlets selling domestic & imported goods.
  • Spinneys Egypt (Retail) with 13 outlets selling domestic & imported goods.
  • BIM (Retail) with 256 outlets selling primarily domestic goods.
  • Kazyon (Retail) with 182 outlets selling primarily domestic goods.
  • Gourmet Egypt (Retail) with 8 outlets selling domestic & imported goods.
  • Alfa Market (Retail) with 6 outlets selling domestic & imported goods.

Routes to Egypt's Retail Market

The route to market is defined as "how to sell the product and plan the sales". The goal is to sell the way the customers want.
  • An export advisor, Open-To-Export, says that the main route to Egypt's market is the main franchise operators; Majid Al Futtaim (UAE), Al Futtaim (UAE), Al Shaya (Kuwait), Olayan (Saudi Arabia), Amer (Egypt) or Mansour Group (Egypt), among others.
  • According to Nielsen, Egypt’s FMCG market is growing at a rate of 17% for the high selling products in the market. However, manufacturers put too much effort in wasted opportunities, this is, in distribution, pricing, and promotion, on the shelf.
  • To get higher sales, Nielsen advised the investors that the key is to understand the number of price, assortment, display, distribution or availability.
  • The Egypt Retail Summit 2019 concluded that the successful “mall of today” should include four pillars; retail, entertainment, food and beverages, and social engagement, for instance, is Cairo Festival City Mall (CFCM).
  • Innovation is the key in unlock the success of a mall according to Nielsen.

SWOT of Retail Sector in Egypt

  • According to Gain report 2018, which is approved by Ali Abdi, the Minister-Counselor of Egypt, the SWOT of Retail Foods and General Retail Sector in Egypt is;

a. Strength

  • Large consumer market.
  • The U.S. origin products are highly accepted.

b. Weakness

  • High tariffs .
  • Comp lex impor t ation regula tions. However, Ashmawy promises an improved investment climate and ease of doing business to attract more investments in Egypt by offering incentives and concessions under the investment law.

c. Opportunity

  • Growing demand .
  • Increase of modern superm arkets, conveni ence stores, and online orderin g platfor ms.

d. Threat

  • Trade comp etitors with free trade - agree ments.
  • Trade comp etitors with closer proxi mity.

Egypt E-Commerce

  • According to Think With Google research, 2017, the e-commerce market size of Egypt was 0.7 billion and Egypt accounts for 80% of Gulf Cooperation Council (GCC)’s e-commerce market.
  • In 2016, e-commerce retail sales in Egypt accounted for 0.4% of the total retail sales in the country.
  • Egypt’s e-commerce market is expected to reach $3 billion by 2022 if fast growth continues.
  • In Egypt, 43% of consumers have purchased a product online at least once. 55% of those who shop online prefer to use smartphones to do so, while 72% of Egyptians use cash to purchase the products.
  • Before someone makes a purchase online, 56% of Egyptians research online at the very beginning using the search engine instead of directly checking the retailers’ websites. Currently, the internet users who shop online in Egypt are 8%.
  • Al-monitor sees that eCommerce in Egypt is in its earliest stages with few brands selling products. Also, few people shop online.


Part
05
of five
Part
05

Industry Analysis; Retail Market - Bahrain

The five insights providing detailed information on the retail market of Bahrain include the country's retail structure, routes to market that are applicable to the Bahrain's retail market, the most popular route to market, frequency of large stores in the retail market and maturity of the retail market in Bahrain.

BAHRAIN'S RETAIL STRUCTURE

  • The retail structure in Bahrain consist of corporate retail chains that are classified under grade A, B and C in terms of market positioning.
  • Grade A malls offer international retailers, food and beverage franchises and entertainment options like cinemas. The malls have an estimated ground leasable area of above 50,000 square meter
  • Grade B malls offer supermarkets and/or department stores with little international brands. These malls have an estimated ground leasable area between 20,000 square meter and 50,000 square meter
  • Grade C malls do not have supermarkets or department stores. They offer regional/local retailers who target the local population mainly for groceries. These malls have an estimated ground leasable area bellow 20,000 square meter
  • Wal-Mart, Amazon Inc., Lulu Group, Carrefour, Spinneys, Choithram, Al Othaim, Al Raya, Al Sadhan, Fu-Com and Balsharaf are among the Bahrain retail sector's major players.

ROUTES TO MARKET APPLICABLE TO BAHRAIN'S RETAIL MARKET

  • According to Startup Overseas, the routes to market applicable in Bahrain include limited liability company, branch office, partnerships, exempt companies, commercial agencies and franchising.
  • In a limited liability company, at least one of the shareholders must Bahraini with not less than 51% of the shares. The company must not engage in banking, insurance or brokerage activities.
  • A branch office for an overseas company can be open with the approval from Minister of Commerce and Agriculture and a local Bahraini sponsor is appointed. However, if the business uses their Bahrain office as the regional center, it is exempted from using a Bahraini sponsor.
  • Partnerships must have at least one Bharaini partner with at least 51% participation in the partnership. All general partner must be Bahraini nationals.
  • An exempt company takes the form of a joint stock company, the main office must be in Bahrain but the activities should be conducted outside the country, Bahrain nationals must not own more than 20% of the capital and the company should take the form of a joint stock company.
  • Bahrain owned companies or agents can be used by overseas companies who want to distribute/sell their products and commodities to the Bahrain market.
  • The demand for US franchises in the country is increasing, especially in fast food, retail and restaurant sector, offering route to the Bahrain market.

MOST POPULAR ROUTES TO MARKET

  • The most popular route to market in Bahrain is franchise.
  • The demand for franchise remains strong in Bahrain. Many major US brands are available in the country.
  • Franchising is increasingly viewed by the local businesses as an opportunity for an additional customer-centric business.
  • The Investment and Technology Promotion Office in Bahrain, operating under United Nations Industrial Development Organization (UNIDO) has been attracting local and foreign investors and promoting franchise as a way to grow small and medium-sized enterprises.

FREQUENCY OF LARGE STORES IN THE RETAIL MARKET

  • Bahrain's top ten malls, consist of two large-sized malls, five medium and three small, receive 51 million guests per year.
  • Two malls, Seef Mall and Country Mall, have the highest number of footfall per square meter. They also have the highest number of parking spots.
  • The inbound traffic from King Fahad Causeway generates the most footfall during the weekends.
  • Seven million Saudi visitors per year are attracted to the malls by cinemas, restaurants and entertainment centers for families.

MARTURITY OF THE RETAIL MARKET IN BAHRAIN

  • The Bahrain's retail industry is driven by business- friendly policies, rising household income, and the improving tourism sector.
  • Most of the retail space in Bahrain is concentrate in city center.
  • High concentration of expatriate population has led to emergence of avenues for retailers in areas such as north of Manama.
  • Retail developers are showing an increasing interest in established residential areas like Juffair because of a slight increase in the retail development.
  • As the number of international operators increase, the regional players such as Lulu Group, Al Othaim, Al Raya, Al Sadhan and Balsharaf are also growing with new stores.

RESEARCH STRATEGY

In the attempt to find the detailed insights providing information on the retail landscape/structure, routes to market, and the frequency of large stores in Bahrain, we looked for information relating to the Bahrain retail market from the news articles, retail industry reports and consultancy industries for research. After going through these sources including but not limited to Consultancy-me, KPMG, Techsci Research and the Bahrain's government news articles and reports, we were able to find detailed insights on the retail landscape/industry of Bahrain.

Sources
Sources

From Part 02
Quotes
  • "As in other North African markets, the Tunisian retail sector has been predominantly controlled by a myriad of small shops. However, modern distribution channels have gradually emerged over the past 15 years with the expansion of international supermarket chains and franchises across the country. During the 2011 revolution, many supermarkets were looted or destroyed – leading to a temporary disruption in activity – but the sector has rapidly recovered and has since experienced double-digit growth, driven by the acceleration of new retail property, an influx of 300,000 high-income Libyan migrants and a gradual shift in consumption patterns."
Quotes
  • "Tunisia does not have a professional trade event to showcase imported products directed for the retail, food processing, or the food service industry. Tunisian food importers are known to seek out suppliers at Fruit Logistica, SIAL Paris, Anuga, and Food Ingredients Europe. Two major agricultural shows are organized alternately each fall, both of which are suitable to showcase imported products that support local livestock and agricultural production, such as genetics, feed ingredients, agro-chemicals, equipment, and services"
  • "Tunisia is likely to remain a small market for food processing, food retail, and food service, with the best opportunities occurring in the food service sector, especially if Tunisia agrees to open market access to U.S. beef, poultry, and processed eggs. Opportunities in the food processing sector will largely depend on the situation in Libya as well as Tunisia’s ability to expand markets in Africa."
  • "Tunisians currently source their food almost equally from modern and traditional distribution channels. One-third of the population buys packaged food once a month and one-quarter buys it once a week. According to the Ministry of Trade, there are 252 modern food retail outlets: 2 hypermarkets, 150 supermarkets and 100 ‘Superettes’ (self-service food outlets with area less than 500 sq. m). By 2019, six new hypermarkets are expected to come online."
  • "The food service sector is not generally perceived as distinct from retail as most hotels and restaurants still source their food needs either through annual tenders or retail outlets. Several foreign franchises have entered Tunisia over the last five years, and currently include Pizza Hut, Fatburger, Chili’s, Papa John's, and Johnny Rockets."
Quotes
  • "Tunisian law does not allow wholesale or retail marketing by foreign businesses. The GOT restricts domestic market distribution to Tunisian nationals. Every joint venture with a foreign investor is considered an exception subject to a license dependent on the advantages of the project to the Tunisian economy. "
  • "For example, licenses were necessary for the opening of foreign-branded hyper/supermarkets established under joint ventures, such as Carrefour, Géant, and Monoprix. Legislation designed to protect smaller businesses from such competition limits the number of hypermarkets authorized in a specific area."
  • "Although the traditional distribution network, based on over 210,000 neighborhood grocery shops scattered throughout the country, continues to dominate the Tunisian market, modern distribution channels are growing rapidly. Hypermarkets now represent 20% of the Tunisian retail sector, and the GOT’s stated goal is to increase the level to 50% in the coming years. "
  • "Currently, there are roughly 252 modern food retail outlets: two hypermarkets, 150 supermarkets, and 100 ‘superettes’ (self-service food outlets with area less than 500 square meters). Fresh fruits and vegetables as well as seafood products are also sold in local outdoor markets. The creation of six more hypermarkets valued at $670 million is expected by 2022."
Quotes
  • "Although the traditional distribution network, based on over 210,000 neighbourhood grocery shops scattered throughout the country, continues to dominate the Tunisian market, modern distribution channels are growing rapidly. They now represent 20% of the Tunisian retail sector, and the GOT's stated goal is to increase the level to 50% in the coming years. Currently, there are almost 250 modern food retail outlets: two hypermarkets, 150 supermarkets, and 100 'superettes' (self-service food outlets with area less than 500 square meters). Fresh fruits and vegetables as well as fish products are also sold in local out-door markets known as "souks." "
  • "Tunisian law does not allow wholesale or retail marketing by foreign businesses. The GOT restricts domestic market distribution to Tunisian nationals. Every joint venture with a foreign investor is considered an exception subject to a license dependent on the advantages of the project to the Tunisian economy. This process allowed the opening of several hyper/supermarkets, set up under joint ventures, with France's Carrefour and Casino groups (Géant and Monoprix). Legislation designed to protect smaller businesses from such competition limits the number of hypermarkets authorised in a specific area."
Quotes
  • "As in other North African markets, the Tunisian retail sector has been predominantly controlled by a myriad of small shops. However, modern distribution channels have gradually emerged over the past 15 years with the expansion of international supermarket chains and franchises across the country. Despite some economic downturn, the modern distribution sector has continued to thrive, with the expansion of international franchising and supermarket brands, and the proliferation of large retail outlets."
  • "During the next few years the sector is expected to keep posting strong growth, driven by a growing population and rising purchasing power. However, from a purchasing power standpoint, retail performance will also be reliant on the country’s capacity to attract foreign tourists, boost the economy and create jobs."
Quotes
  • "Retailing in Tunisia is characterised by the dominance of local players in traditional outlets, with domestic brand owners which are performing well including Poulina Group Holding, Société Chahia and Masmoudi Patisserie. However, modern outlets are dominated by multinationals, including Carrefour and Casino Guichard-Perrachon (Monoprix). "
From Part 04
Quotes
  • "Your route to market is how you you sell your product and how you plan your sales. It's one of the most important things to get right: if you don't sell the way your customers want, they won't buy your product. "
Quotes
  • "In 2017, e-commerce in the Middle East and North Africa (MENA) reached $8.3 billion, with an annual growth rate of 25%. It is forecast to hit $28.5bn by 2022, with a penetration rate of total retail sales of 7% with the Gulf Cooperation Council (GCC) and Egypt accounting for 80% of the region’s e-commerce market."
  • "Meanwhile, Egypt’s e-commerce market is growing at a fast rate and is expected to reach $3 bn by 2022. Although still nascent, it has the potential to be significant as consumer digital adoption rises and its e-commerce ecosystem matures."
  • "Researching online is a big part of the customer journey in MENA, whether the product or service is purchased online or in a physical store. Almost 56% of consumers in the UAE, KSA and Egypt start their online shopping journey using Search engines as opposed to retailers’ websites."
  • "MENA consumers prefer to use their smartphones for online research and shopping. In the UAE and Saudi Arabia, the mobile share of shopping-related Search queries has averaged 70% and the majority of shoppers (55%) in the UAE, Saudi Arabia and Egypt, prefer to use smartphones to shop online."
  • "More than 60% of shoppers in the UAE and Saudi Arabia and 43% in Egypt have transacted online at least once. "
Quotes
  • "Demand for food and beverage products is expected to rise in the coming years. The economic policy reforms implemented in 2016 are yielding positive results on macroeconomic stability, but consumers still face high inflationary pressures. "
  • "Egypt faced high inflation in the months following the November 2016 currency devaluation. Upward price pressures have now begun to fall and demand is improving. Higher-income consumers were less impacted by inflation and growing government austerity, while mid to low-income buyers were forced to alter their consumption patterns. "
  • "Top Egypt Retailers - Carrefour - Mansour Holding - Seoudi Markets - On-the-Run - HyperOne - Spinneys - BIM - Kazyon - Gourmet - Alfa Market"
  • "in Billions Domestic Sales $24.7 Retail $24 Food Service$0.7"
  • "The Egyptian retail foods sector is estimated to be $24.7 billion. Higher income consumers drive much of the demand for imported products, while middle and lower income consumers are tending toward substitution of imports with domestic alternatives. As incomes recover and purchasing power increases, the market is expected to grow. Retail industry representatives anticipate growth of 15-20 percent in the coming five years. Imports of consumer-oriented food products in 2017 reached $2.6 billion. "
  • "Traditional outlets dominate the Egyptian market, representing 98.7 percent of total outlets and around 80 percent of total sales. In spite of this, modern outlets are growing in number and volume of sales. Online retail platforms are also becoming increasingly popular as internet penetration increases."
Quotes
  • ""We are seeing unprecedented growth rate in Egypt's retail sector of 36 per cent per annum." "
  • "Ashmawy said with an improved investment climate and ease of doing business, it is the best time to invest in Egypt. "We offer incentives and concessions under the investment law. We offer long-term lease and grace period. We, on behalf of all government departments, act as one-stop shop and deal with all the developers and investors.""
  • " He noted Egypt has 2.6 per cent population growth rate and consumers with high purchasing power - aspects for retailers to thrive."
Quotes
  • "Main route to market will be via one of the main franchise operators; Majid Al Futtaim (UAE), Al Futtaim (UAE), Al Shaya (Kuwait), Olayan (Saudi Arabia), Amer (Egypt) or Mansour Group (Egypt) among others."
  • "Egypt’s retail and wholesale sectors developed significantly in recent years. Retails sales rose due to a large and youthful population, the emergence of a more affluent middle class, a vibrant tourism industry and the growing acceptance of modern retail concepts."
Quotes
  • "eCommerce in Egypt is in its earliest stages, with few brands offering their goods online, and few people shopping online. However, as the leading Arab country when it comes to internet users, companies are beginning to pay attention. eCommerce will grow steeply in the coming years, and brands hoping to capitalize on the growth will need to offer cash-based payment methods, to build trust in an emerging market."
  • "Egypt is not without its challenges, 72% of customers use cash for their eCommerce purchases, and currently only 8% of internet users are online shoppers."
  • "“Egypt remains a cash-based economy, if we move beyond the domination of cash society, the growth of e-commerce in Egypt would accelerate even more.”"
Quotes
  • "he percentage of e-commerce sales in Egypt in terms of volume of retail trade amounted to 0.4% in 2016, according to a report by the Ministry of Communications and Information Technology (MCIT). The report noted that e-commerce sales out of total retail sales in the Middle East and Africa (MEA) reached 1.8%."
  • "Although still in its infancy, Egypt’s e-commerce market has had some early successes since the first e-commerce sites and internet businesses were established in Egypt in the late 1990s."
  • " e3050, founded in 2004, is reported to be the first e-retailer in Egypt (electronics). Other examples include sites such as freedaysegypt.com (tourism), tahriracademy.org (online education), and alborglab.com (health), as well as in the media sector with advertising-based Arabic news portals Masrawry, Egypt’s first and most popular news site (1999), and sports news site FilGoal (2001)."
From Part 05
Quotes
  • "This rise has been in part attributed to the 3.5% annual population growth in Bahrain together with a household income growth of 5%, yet the nation’s 1.3 million residents currently only account for around BHD 530 million of the total yearly value of the retail sector, with its 10 million annual tourists contributing the remaining BHD 1.7 billion."
  • "As it stands, Grade A malls, those which offer a number of international retailers such as upscale department stores as well as franchised food and beverage offerings and entertainment options like cinemas and family centres, account for approximately 90% of Bahrain’s retail GLA together with Grade B malls – which have a supermarket and/or a department store but a limited selection of international retail brands."
Quotes
  • "The Bahrain retail real estate market has grown steadily, with the addition of at least one retail mall each year since 2007. "
  • "At least 65% of tourists arrive from Saudi Arabia, accounting for a dominant revenue share of retail business."
Quotes
  • "BAHRAIN retail market is projected to grow at a CAGR of over 5%, in value terms, during 2019-2024. Rising number of infrastructure projects, increasing tourist footfall, and rising population on the account of increase in number of diversified cultural population are some of the other factors expected to propel demand for retail over the next five years."
Quotes
  • "The most popular form of company for foreign investors, the business must have between two and fifty shareholders and the shares are not available for public purchase. "
  • "Branch office companies are businesses that are established outside Bahrain and are permitted to open branches or offices in the country, on the condition of approval from the Minister of Commerce and Agriculture and a local sponsor is appointed"
Quotes
  • "Most of the principal types of business entities in Bahrain are governed by the Law of Commercial Companies, Decree 28 of 1975, as periodically amended."
  • "The public stock company may have a board of directors composed of between three and twelve directors, each nominated for a three year term"
Quotes
  • "The demand for U.S. franchises remains strong in Bahrain, particularly in the fast food, restaurant, and retail sectors. "
  • "More than one hundred U.S. franchise restaurants and outlets operate in Bahrain, with new ones opening regularly. "
Quotes
  • "The retail industry in Bahrain is primarily driven by business-friendly policies, rising household income and improving tourism industry. "
  • "However, the growing tourism sector, primarily driven by government initiatives towards promoting the country as a tourist destination, has led to the development of new retail concepts in the country. "