Saudi Gazette report

RIYADH — Saudi Arabia posted a record surge of 866 percent in franchise registrations over the past three years. The number of franchise registrations shot up to 1,788 by the end of the third quarter of 2024, compared to 185 franchise registrations in the fourth quarter of 2021, the Ministry of Commerce said in a statement on Monday.

Tourism, hotels and restaurants activities topped the list of the fastest growing sectors in franchise registrations with 1,232 registrations, followed by the wholesale and retail sector with 689 registrations, and the transport and storage sector with 257 registrations. The ministry noted that a single registration may include multiple activities.

The Riyadh region topped among the Kingdom’s regions with 647 franchise registrations, and it was followed by Makkah region with 363 registrations, and then the Eastern Province with 225 registrations.

The ministry stated that the Franchise Law and its executive regulations were issued in 2019 and 2020. They contributed to the growth of franchise registrations and encouraged franchise activities in the Kingdom by establishing a regulatory framework for the relationship between the grantor and the franchisee, according to principles that enhance transparency and clarity.

It is noteworthy that the Franchise Center, which is affiliated with the Small and Medium Enterprise General Authority (Monsha'at), plays a vital role in enabling entrepreneurship by spreading the culture of franchise, providing services, attracting local and foreign investment, and creating new job opportunities in accordance with the goals of the Kingdom’s Vision 2030.

Global franchises entered Saudi Arabia in 1970 and have greatly impacted the Kingdom’s economic and cultural landscape. According to Monsha'at, there are more than 380 Saudi companies which have franchises Kingdomwide and are now expanding into other GCC states.