Retail Leaders Summit Panel 1

Food courts vs. food halls in the Middle East

  • We have read in the media about a boom in food hall development particularly, in the Kingdom of Saudi Arabia. Are asset owners really converting food courts to food halls on a wide scale despite five decades of proven performance by food courts regionally and globally?

  • We certainly think food halls have a place, they provide community and social dining delivering multiple experiences in one space but love them or hate them, food courts are here to stay.

  • Maddy worked on al Mamlaka at Kingdom Tower Riyadh which has become one of the top culinary destinations in the city within weeks of opening. However, the guest profile Kingdom Towers is unique with many office workers being able to access al Mamlaka on foot and armed with high levels of disposable income.

  • The panel agreed that food halls are a great way to deliver an agile F&B offer that can adapt to changing market needs. They are also a perfect place for talent to be nurtured and developed, whether it’s creating or managing new-to-market concepts or established brands.

  • Our overall conclusion was that replacing a food court with a food hall is a bold move and perhaps, as you would expect us to say, get advice from people who have done it before and can build a bespoke solution.
Retail Leaders Summit Commerical Drivers Infographic

The table above was presented and provides an overview of the commercial drivers for food courts versus food halls

Thriving entrepreneurialism in the Kingdom  

  • There has been a great deal of press coverage about new F&B concepts popping up in the Kingdom, created and operated by Saudi nationals.

  • We are constantly commissioning research to improve our knowledge of the rapidly changing dining behaviour of Saudis and, on one of our assignments, we probed the level of interest in F&B investment. We asked 1000 Saudis about their F&B investment ambitions, and the result was striking with over 50% of respondents saying that they intended to invest in F&B in the next five years.

  • This is unprecedented, globally or regionally, and reflects a deeply ingrained culture of entrepreneurialism in the Kingdom that will likely be a key foundation in the nations’ rapidly developing economy.

  • On the panel, we were joined by two great examples of this entrepreneurialism; Rakan Aloraifi* and Eman Fallatah*. Rakan is a leading example of how Saudi chefs are developing at a rapid rate and Eman leads the surge in female entrepreneurialism in the Kingdom.

  • Both individuals are creating unique and bespoke concepts for the nation without having to copy what they've seen elsewhere in the region or paying franchise fees and then having to work within the rigidity of a franchise business formula. More power to you Rakan and Eman!
Retail Leaders Summit Stefan 1

The continued evolution of the coffee sector in the region

  • As background, the coffee market in the Kingdom of Saudi Arabia is estimated at USD 1.6 billion in 2022. It is forecast to grow at a rate of 5% per annum by 2029. The major growth drivers include a growing demand for innovative flavours and new tastes that complement traditional styles. The rapidly evolving corporate culture and rate of urbanisation has contributed to this growth. 

  • The Kingdom’s Vision 2030 aims to promote domestic coffee production with plans to grow higher-quality coffee backed by sovereign wealth fund investment in the sector.

  • Phil Broad* highlighted that a key feature of the market is not only growth but also the innovation in design from seating to interiors and the way the food and merchandising are presented. All these elements have moved significantly from when the first coffee brands arrived in the Kingdom 25 years ago. The food offer has grown significantly offering a broader range and higher level of quality.

  • Locally created coffee concepts are growing significantly driven by entrepreneurialism and the desire to offer premium coffee products such as cold brew. Alghanim have launched Jazean coffee across all of its KSA stores from the Jazan region in the south of the Kingdom.
Retail Leaders Summit Maddy 2

Innovative ways in which asset owners can approach evaluating F&B space and mix

  • You can always tell when a leisure or hotel development has got the F&B right; there aren't swathes of empty restaurants or terrifying queues to navigate. With careful planning, the right amount of space and mix can be determined for F&B. The panel discussed how some developments across the region really did get the amount of F&B wrong and often faced the prospect of being bulldozed and rebuilt.

  • Stefan shared our approach to this with the group. When we work on a development; whether it's mixed-use or a mall or a hotel, we track every visitor; we don’t use random percentages or income per square metre, our approach is to understand that each diner occupies a certain amount of space for an amount of time and therefore the optimal space can be calculated with careful consideration of all the variables such as seat turns etc.

  • This approach has been used across a number of the main giga projects in the Kingdom which ultimately mean that asset owners can be assured that space has been optimised and the asset is being fully maximised.

The overall conclusion of the panel was that F&B is in a state of heady flux in the Kingdom; an almost perfect storm of change and perhaps we have never seen such rapid change. Agility will be key to stay ahead of these changes, agility in thinking, concepts and approaches.

*Eman Fallatah - Owner, Creative Eats Studio
*Rakan Aloraifi - Founder, KIT Catering
*Phil Broad - SVP Alghanim

If you want to discuss F&B in the Kingdom, get in touch here.