Franchise registrations in Saudi Arabia surge by 866 percent in 3 years

(MENAFN) Franchise registrations in Saudi Arabia have surged by an impressive 866 percent over the past three years, reaching 1,788 by the end of the third quarter of this year, compared to just 185 in the last quarter of 2021. This significant growth highlights the increasing popularity of franchising in the country, reflecting the broader economic reforms and supportive measures introduced in recent years.

The dramatic rise is largely attributed to the implementation of the Commercial Franchise System in October 2019 and its executive regulations introduced in May 2020. These regulations have established a robust framework to govern the relationship between franchisors and franchisees, emphasizing principles of transparency and clarity. This structured approach has played a key role in fostering growth within the franchising sector and encouraging new franchise activities.

The General Authority for Small and Medium Enterprises (Monsha’at), through its Commercial Excellence Center, has also contributed to this expansion. The center actively supports entrepreneurship by promoting a culture of excellence, providing essential services, attracting both local and foreign investments, and creating new job opportunities. These efforts align with the goals of Saudi Arabia’s Vision 2030, which aims to diversify the economy and stimulate sustainable development.

Accommodation and food services, including tourism-related activities, hotels, and restaurants, dominate the franchising sector, with 1,232 franchise restrictions recorded. Wholesale and retail come next with 689 restrictions, followed by transportation and storage with 257. Among the regions, Riyadh leads with 647 franchise restrictions, followed by Makkah Al-Mukarramah with 363 and the Eastern Region with 225, reflecting the concentrated economic activity in these areas.

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