Ken Research report on Saudi Arabia Logistics Market research report covers Cold Storage Market Saudi Arabia,Future Saudi Arabia Value Added Services,Developments Saudi Arabia Logistics,Express Delivery Market Saudi Arabia,GCC Countries Logistics Market,MENA Logistics Industry Growth

1. Saudi Arabia Logistics & Warehousing
Market Report - 2020

2. • How Logistics & Warehousing Market Is Positioned in Saudi Arabia?
Saudi Arabia has established itself as a leading country in logistics & Warehousing
Industry in GCC region. The kingdom is one of the fastest growing countries in the
logistics and warehousing industry globally. Additionally, it is the primary entry
point for goods in the GCC market. It borders Oman to the East and UAE to the
North. Saudi Arabia also shares sea borders with Qatar and Iran. The geographic
location makes the region most suitable for logistics industry. Saudi Arabia has
been the foremost nation in the Middle East to focus on logistics. The logistics &
warehousing market has increased at a CAGR of ~% during 2010 to 2015. The
market has increased from USD ~ billion in2010 to ~ billion in 2015. The improving
road infrastructure, rise in government support in the form of incentives and
subsidies, improving corporate working environment due to large availability of
expatriate workforce has driven the size of the industry.

3. The rising demand of cold chain logistics in the country due to the increase in the
consumption of meat & animal food has triggered the size of the logistics industry.
The warehouses and fleet required for transportation of cold chain products are
costlier than the logistics requirement for other products. The robust growth in e-
commerce sector in the country has majorly influenced the growth rate of logistics
and warehousing industry. Especially, the express delivery services offered by the
e-commerce giants to the customers have accelerated the market. The
prominence of online shopping has increased in the country with the rise in
internet penetration in the kingdom. The internet penetration has increased from
~ million people in 2010 to ~ million in 2015 among the population of Saudi
Arabia. Saudi Arabia has low performance indicator as compared to other GCC
countries.

4. Freight forwarding segment has dominated the Logistic and warehousing industry
in Saudi Arabia over the past few years. The increase in demand for transportation
of goods from one place to another has accelerated the size of the freight
forwarding services in the country. Warehousing is the second largest contributor
in the logistic Industry. Rise in the retail and FMCG industry in the country has
driven the demand of warehousing services in the country. Value added services
had contributed ~% in 2015. Continual investment by the government in
development of logistics infrastructure and entry of several global players in the
market have been the main reasons behind the increase in the share of the
warehousing segment over the past five years.

5. Normal delivery has contributed majorly to the revenues of Saudi Arabia logistics
market over the past few years. Normal delivery usually takes 6-7 days for
delivering the product (depends on the distance between pick up & dropping
point). Majority of the B2B logistics is performed through normal delivery. The
express delivery segment has contributed ~% in the revenues of freight forwarding
industry during 2015. Express services are specialized delivery services where the
time for a standard package or shipment to be delivered is usually between 24 to
72 hours. Express services are fast delivery services owing to which their cost is
much higher as compared to normal services. Jeddah is the ~ region in the
revenues of the industry contributing a share of ~% in 2015, followed by
Dammam, Riyadh and others. In terms of industry verticals, oils & gas industry has
contributed largely with the share of ~% in 2015 followed by Engineering
equipments (~%), Food & beverages (~%) and others.

6. • How Freight forwarding Market of India is Performing?
Freight forwarding industry has observed a tremendous growth rate in past few
years. Expanding FMCG sector, retail, and food & e-commerce industry in the
kingdom has attributed to the phenomenal growth in freight forwarding industry
in 2010-2015. In the kingdom, the impressive performance of the industries and
their strong expansion plans despite the global economic downturn, have opened
up several prospects for logistics outsourcing. Freight forwarding market of the
country has dominated the overall market of Saudi Arabia logistics & warehousing
services with the percentage share of ~ % in terms of revenues in 2015. The
market has increased from USD ~ Billion in 2010 to USD~ billion in 2015, growing
at a CAGR of ~% during the period. The flow corridor Asia-Saudi Arabia-North
America/European Union has contributed majorly to the revenues of the
international sea freight forwarding market.

7. Sea freight movement has majorly dominated the market of Logistics in Saudi
Arabia with the share of ~ % in 2015, followed by air freight (~ %) and land freight
(~ %). By type of delivery services normal delivery has contributed majorly in the
revenues of Saudi Arabia logistics market over the past few years. In terms of
domestic and international freight forwarding segmentation, international freight
forwarding has largely contributed in the revenues of the industry. The market will
increase at a CAGR of ~ % during 2016 to 2020. Free trade agreement between
Saudi Arabia and the GCC countries which has been commenced during 2015 is
also projected to provide the impetus for growth in the freight forwarding market
in the country.
• What is the Role of Warehousing Market in Saudi Arabia Logistics & Warehousing
Market?
Saudi Arabia Warehouse and logistics market has witnessed a significant
development as strong demand fundamentals from the automotive, consumer
and construction sectors are being actively addressed by the planned expansion of
the country’s logistics capabilities, primarily under the patronage of Jeddah’s
Municipality and Jeddah Chamber of Commerce.

8. The market has increased from USD ~ Billion in 2010 to USD~ billion in 2015,
growing at a CAGR of ~% during the period. The factors such as growth in external
trade, growth across major industry segments such as automobile,
pharmaceutical, fast moving consumer goods (FMCG) and the emergence of
organized retail have favorably influenced the growth of warehousing industry in
the kingdom. Industrial/Retail sector has contributed majorly in the revenues of
warehousing industry with the share of ~ % in 2015 followed by container freight
and cold storage. By geography, Riyadh has contributed majorly in the revenues of
warehousing industry. Riyadh is centrally located and well connected to other
cities of the kingdom. WPL, Al- Jabri group, four winds Saudi Arabia limited are
some of the major players in warehousing sector of Saudi Arabia. It has been
anticipated that the market will increase at a CAGR of ~ % during 2016-2020 to
reach at USD ~ billion in 2020. The warehousing market will rise at a CAGR of ~%
during 2016 to 2020. The construction, retail, and automotive sectors will continue
to account for the majority of demand for warehouse space and manufacturing
land in Saudi Arabia.

9. • What is the Role of Express Delivery market in Saudi Arabia logistics &
warehousing industry?
The express logistics is a part of the overall logistics industry dealing with time
bound logistics services. It involves the movement and transport of documents,
parcels, goods, materials, products, which includes activities including freight,
storage, packaging and inventory management. The goods are transported in the
express logistics industry by all the basic modes of transportation including land,
water, rail and air. The market has increased from USD ~ Billion in 2010 to USD~
billion in 2015, growing at a CAGR of ~% during the period. The express industry
market has evolved from the delivery of documents and parcels to specialist items
such as high-tech products, semiconductors and general airfreight commodities.
Rapid growth in the E-commerce industry has fueled the demand of B2C parcel
and consumers are now demanding more convenient methods of collecting their
parcels as well as efficient methods of return & exchange of parcel, resulting in the
increase in the demand for express delivery services. Some of the leading
companies in the segment are Fed Ex, Aramex, DHL, Agility, UPS, Almajdouie group
and others.

10. Air express has dominated the market of Saudi Arabia express logistics during
2015. The presence of well planned infrastructure to support air cargo had been
the prime reason which has attributed for the dominance of air express in the
country. In terms of B2B and B2C clients, B2B has dominated the market of express
logistics in 2015 in terms of revenues with the share of ~ %. Express Delivery
market in Saudi Arabia is expected to increase at a CAGR of ~ % during 2016-2020.
It has been anticipated that the market for ready to serve food and frozen food will
increase, which will trigger the demand for express delivery. Also, the boom in
pharmaceutical industry in the country will generate demand for express logistics
to transport medicines, vaccines and organs from one place to another.
• Cold Chain Market
Saudi Arabia cold chain market is estimated at USD ~ billion during 2015 and has
soared at a compound annual growth rate (CAGR) of ~% from 2010-2015. This
growth was due to the increasing contribution from the fruits and vegetables
production which grew at a healthy growth rate coupled with the active
participation by the pharmaceutical industry which has also registered substantial
growth in the kingdom.

11. The cold chain logistics has been largely dominated by cold storage which has
contributed the largest share of ~% in the overall cold chain market during 2015.
The leading companies in Saudi Arabia warehousing industry are Tameem logistics,
Aramex, Gulf Agency Company and others. It has been forecasted that the market
will increase at a CAGR of ~% during 2016-2020 to reach at USD ~ million in 2020.
• THIRD PARTY LOGISTICS MARKET
Third party logistics market has witnessed a robust growth in the past few years in
Saudi Arabia. The market is growing at a CAGR of ~% during 2010-2015. Third-
party logistics (3PL) outsourcing is rapidly gaining prominence as more and more
corporations across the world are unable to manage their complex supply chains
and hence are outsourcing logistics activities to the 3PL service providers. 3PL
industry has grown in recent years with the expansion of e-commerce industry in
the country. The demand for 3PL logistics services by international and domestic e-
commerce companies have increased to serve the customers in every part of the
country.

12. • Future Growth of Saudi Arabia Logistics & Warehousing Industry
Saudi Arabia logistics market is expected to increase at a CAGR of ~% during 2016
to 2020 to reach at USD ~ billion by 2020. Rising demand of warehousing and cold
storage, growing E-commerce and retail industry, entry of foreign players, rising
government support and increasing trade with other major trading partners will
drive the market in coming future. Rising retail and FMCG industry of the country
will accelerate the demand for warehouses storage and transportation & logistics
facility. The revenue of the logistics market has been mainly contributed by the
freight forwarding sector over the past five years and this sector will continue to
dominate the market over the period 2016-2020 as well. Freight forwarding
services will increase at a CAGR of ~% during 2016 to 2020. Warehousing segment
will contribute a market share of ~% in terms of revenue in 2020. The contribution
of the share will be on the grounds of further investment by the government in
development of logistics infrastructure.

13. • Source: https://www.kenresearch.com/automotive-transportation-and-
warehousing/logistics-and-shipping/saudi-arabia-logistics-market-report/77655-
100.html
• Contact:
Ken Research
Ankur Gupta, Head Marketing & Communications
Ankur@kenresearch.com
+91-9015378249

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