The Spinneys brand lands in Saudi Arabia. The UAE retailer has a joint venture to pursue its growth plans in the Kingdom. Image Credit: Supplied

Dubai: Spinneys, the Dubai headquartered grocery chain, has ticked off a key milestone with the launch of its first store in Saudi Arabia - part of an expansion that should sit well on its medium-term growth chances. It was also a key promise that the retailer made during its IPO and eventual listing on the DFM early this year.

"Our entry into Saudi Arabia - a historic moment for a homegrown UAE brand - is driven by strong demand and positive market fundamentals, bolstered by the transformative Saudi Vision 2030, which has created an ideal environment for retail sector growth," said Sunil Kumar, CEO. "Our track record in the GCC, coupled with best-in-class insights and partnerships in the Kingdom, give us a robust platform and we look forward to becoming a trusted name in the market."

The Saudi entry is through a joint venture with the Abdul Mohsen Al Hokair Holding Group, and which will target more openings in Riyadh and Jeddah before expanding further in that market.

Once DFM opens today, the Spinneys stock should come under close watch from investors. It's currently at Dh1.38, off from its Dh1.7 peak.

Saudi Arabia can easily take on new retail space
Forecasts are for Saudi Arabia's retail space to increase to 86 million square feet by 2033 - 'equivalent to nearly 1,200 Spinneys stores'. "The growth in 'whitespace' in the Saudi market is supported by structural tailwinds including a projected 6.4% CAGR in the Kingdom’s affluent population between 2022-28," says Spinneys.

New Riyadh store

The first Saudi store - spread across 43,520 square feet - is in Riyadh's upscale La Strada Yard development in An Nuzha district. The plan is to have 12 stores in Saudi Arabia by 2028. The Saudi retail and grocery sector on its own has been seeing some sizeable growth patterns, with online sales also figuring in the mix. Leading supermarket and hypermarket operators had been investing in - or aligning with - ecommerce players to win orders and deliver, including using 'q-commerce' (quick commerce) options.

Our entry into Saudi Arabia (is) a historic moment for a homegrown UAE brand

- Sunil Kumar of Spinneys

But physical retail continues to hold sway in Saudi Arabia, as it has in other key GCC markets. This is the growth that Spinneys will look to juice up further.

"Spinneys' entry into Saudi Arabia comes at a time when the Kingdom continues to pursue growth and diversification, supported by ambitious government initiatives including Vision 2030 and upcoming global events such as Riyadh Expo 2030 and the FIFA World Cup 2034," the retailer added.