Global macroeconomic research firm BMI International says the outlook is positive for the UAE’s mass grocery retail sector.
Global macroeconomic research firm BMI International says the outlook is positive for the UAE’s mass grocery retail sector and the country's consumer outlook “remains bright” to 2019, even in an environment of lower oil prices.
In a statement, the company predicted that the convenience segment in particular will grow, benefitting from "increasingly time-poor consumers and increasing numbers of women entering the labour force".
According to BMI, the UAE’s current 5.7% annual compound growth rate in food consumption will rise to 7.7% by 2019, with total soft drinks sales rising from the current CAGR of 7.5% to 7.7% and mass grocery retail (MGR) sales rising 10.1% CAGR until the onset of the next decade.
It added that prospects for the F&B market in Saudi Arabia are even stronger despite what it determines are “short-term economic headwinds”.
Its forecast to 2019 said a number of factors will impact an upward trend in the Kingdom.
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“Sales will continue to benefit from rising disposable incomes, favourable demographics, increasing urbanisation and ongoing formalisation of the mass grocery retail sector,” BMI stated.
The company said Saudi will lead the way in a regional MGR upswing with year-on-year total food consumption growth of 7.3% CAGR until 2019. Per capita food consumption growth in the Kingdom will rise from the current CAGR of 4.6% to 5.4% to 2019, while the value of total soft drinks sales will reach 6.9% CAGR growth to 2019 and MGR sales will climb 8.9% CAGR to the same period.
“All analyst indicators point to considerable business opportunities for the sector across the retail and hospitality sectors with both undergoing sizeable growth and modernisation,” explained LohMirmand. “Convenience retailing is now being pursued more aggressively within the retail segment while the regional hospitality sector continues growth strategies linked with expanding national and regional tourism ambitions,” commented Trixie LohMirmand, senior vice president, exhibitions & events management, Dubai World Trade Centre (DWTC), which is witnessing huge space demand from suppliers, traders and roaster and finished product equipment manufacturers at Gulfood.
The 21st edition of the world’s largest annual food and hospitality trade show will run from February 21-25 2016.
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