Feb 23 2012
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Saudi Arabia enters age of consumerism
The increasingly interconnected world has shaped consumers' tastes and aspirations where foreign investors and innovative local entrepreneurs have devised creative services to meet them. In many cases, such providers have the luxury of catering to significant pent-up demand. These trends promise to continue strong in the coming years, which has led investors to prioritize services, food, and related sectors in key growth opportunities.
"As much as these trends are transforming people's lives for the better, they also - like most things - have a downside. Consumerism is encouraging sedentary lifestyles. It is leading to more eating out, which in turn tends entails eating more in terms of quantity and often less in terms of quality, healthiness, and nutrition," Jarmo T. Kotilaine, chief economist at the National Commercial Bank, said.
According to a report by Euromonitor International, the world's leading provider of global business intelligence and strategic market analysis, Saudi Arabia's fast food market is expected to reach $4.5 billion in the next three years.
Moreover, he added, due to limited social outlets youngsters tend to spend time in these outlets of fast food as part of recreation and social gathering. Besides being associated with knowing the new and the trendy places it became too many as fade.
"I have no problem with the issues of consumers' choices but we need to create a culture of awareness about the pros and cons about these newly trends so we can start from where others end by media awareness and social responsibilities," Al-Nwaisir said. Also, he added: "We have to create stringent rules and regulations to protect consumers and advocate their rights otherwise we will find ourselves in cowboy mentality and our culture will become only for consumption rather than for production. We have to protect our culture and market by rules and creating more awareness for consumers and high quality standard for the service offerings."
Michael Schaefer, head of consumer foodservice research at Euromonitor, said: "Fast food outlets have become important social spaces for a growing cohort of Saudi young people. Future expansion will be driven by those operators which offer a combination of indulgence and inviting, comfortable outlets, with hamburgers, ice cream, and sweet baked goods all in high demand."
He said Euromonitor expects chains to lead the way, with chained operators projected to account for nearly 20 percent of Saudi foodservice transactions by 2015.
"More broadly, eating out has emerged as a key entertainment option for Saudi consumers of all ages, creating real opportunities for those operators able to tailor their concepts to local tastes," Schaefer said in a statement.
There are major Saudi food companies active in Saudi Arabia such as Herfy Food Services Co., Almarai, Saudi Fisheries Co., Al-Baik and Savola Group. International fast food chains such as McDonald's, Pizza Hut, Burger King, KFC, Subway, Kudu, Dunkin' Donuts, Hardee's, Wendy's and Wimpy are some of the very popular brands in the Kingdom.
© Arab News 2012
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