Market Insights eCommerce Online Food Delivery Meal Delivery

Restaurant Delivery - Saudi Arabia

Saudi Arabia

The Restaurant Delivery market in Saudi Arabia is projected to reach a revenue of US$8.72bn in 2024.
This is expected to show an annual growth rate (CAGR 2024-2029) of 3.31%, resulting in a projected market volume of US$10.26bn by 2029.
Additionally, it is expected that the number of users in the Restaurant Delivery market will amount to 14.5m users by 2029.
The user penetration in this market is projected to be 34.1% in 2024 and is expected to increase to 36.2% by 2029.
The average revenue per user (ARPU) is estimated to be US$0.68k.
When compared globally, United States is expected to generate the highest revenue in the Restaurant Delivery market, reaching US$36,950.00m in 2024.
On the other hand, South Korea is projected to have the highest user penetration rate of 44.8% in the Restaurant Delivery market.
The restaurant delivery market in Saudi Arabia is experiencing a surge in demand due to the growing popularity of online ordering platforms.

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Analyst Opinion

The popularity of food delivery services has been on the rise in Saudi Arabia in recent years.

Customer preferences: Saudi Arabia has a young and tech-savvy population that is increasingly turning to online platforms for their daily needs. The convenience of ordering food online and having it delivered to their doorstep has made restaurant delivery services a popular choice among consumers. Additionally, the COVID-19 pandemic has further accelerated the trend of online food delivery as more people are staying at home and avoiding crowded places.

Trends in the market: The food delivery market in Saudi Arabia is highly competitive with many players vying for market share. The market is dominated by international players such as Uber Eats, Talabat, and Deliveroo, as well as local players such as HungerStation and Careem Now. These players are constantly innovating and introducing new features to attract customers, such as loyalty programs, cashless payments, and faster delivery times.One of the recent trends in the market is the rise of ghost kitchens, which are delivery-only restaurants that operate out of shared kitchen spaces. These ghost kitchens are able to offer a wider variety of food options at lower prices, as they do not have the overhead costs of a traditional restaurant. This trend is expected to continue as more players enter the market and look for ways to differentiate themselves.

Local special circumstances: Saudi Arabia has a strong food culture, with a preference for traditional Middle Eastern cuisine. However, there is also a growing demand for international cuisine, particularly among the younger generation. This has led to the emergence of online platforms that offer a wide range of food options from both local and international restaurants.Another unique aspect of the Saudi Arabian market is the strict regulations around food delivery. For example, all food delivery drivers must have a valid driver's license and a commercial vehicle license. Additionally, all food delivery vehicles must be equipped with a refrigeration unit to ensure that food is delivered at the correct temperature.

Underlying macroeconomic factors: Saudi Arabia has a large and growing population, with a high percentage of young people who are tech-savvy and comfortable with online platforms. The country also has a strong economy and high levels of disposable income, which has contributed to the growth of the food delivery market.The COVID-19 pandemic has also had a significant impact on the market, with more people staying at home and relying on food delivery services for their daily needs. This trend is expected to continue in the post-pandemic era, as consumers have become accustomed to the convenience of online food delivery.

Methodology

Data coverage:

The data encompasses B2C enterprises. Figures are based on Gross Merchandise Value (GMV) and represent what consumers pay for these products and services. The user metrics show the number of customers who have made at least one online purchase within the past 12 months.

Modeling approach / Market size:

Market sizes are determined through a bottom-up approach, building on predefined factors for each market. As a basis for evaluating markets, we use annual financial reports of the market-leading companies, third-party studies and reports, as well as survey results from our primary research (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, GDP per capita, and internet connection speed. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing. The main drivers are internet users, urban population, usage of key players, and attitudes toward online services.

Additional notes:

The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level. GCS data is reweighted for representativeness.