Market Scenario 

Saudi Arabia B2B catering services market was valued at US$ 1,969.1 million in 2023 and is projected to hit the market valuation of US$ 3,500.1 million by 2032 at a CAGR of 6.6% during the forecast period 2024–2032.

The demand for B2B catering services in Saudi Arabia has been significantly increasing, driven by various macroeconomic and microeconomic factors. Key end-users of these services include government entities, corporate organizations, oil and gas companies, defense sectors, construction firms, religious sites, healthcare institutions, educational establishments, and the burgeoning tourism industry. One of the primary reasons for this surge is the government's Vision 2030 initiative, aimed at diversifying the economy beyond oil dependence. This has led to an influx of infrastructure projects like NEOM and the Red Sea Development, requiring extensive catering services for thousands of employees engaged in these ventures. The construction sector alone in the B2B catering services market, with projects like the King Salman Park expected to cover 13.4 square kilometers, demands large-scale catering solutions for its workforce.

Religious tourism is another significant contributor. Annually, millions of pilgrims visit Mecca and Medina for Hajj and Umrah. For instance, in 2019, over 2.5 million pilgrims performed Hajj, creating a substantial need for catering services in these holy cities. The expansion plans to accommodate up to 6 million Hajj pilgrims annually by 2030 amplify this demand further in the B2B catering services market. The oil and gas industry, a cornerstone of the Saudi economy, employs a vast workforce, especially in remote areas where self-sufficiency is crucial. Catering services play an essential role in maintaining operations by providing meals to employees in locations like the Ghawar Oil Field, the world's largest onshore oil field stretching over 280 by 30 kilometers. Apart from this, corporate entities are increasingly hosting conferences and events due to the growing business environment, necessitating professional catering services. The healthcare sector is expanding rapidly, with plans to add 20,000 hospital beds, increasing the need for patient and staff catering. Educational institutions are also on the rise, with over 10 new universities planned, requiring catering for students and faculty.

Current trends shaping the demand for Saudi Arabia B2B catering services market include a heightened emphasis on health and hygiene, accelerated by global health concerns. There's a growing preference for diverse and healthy food options, leading catering companies to innovate their menus with organic and international cuisines. Technological integration is becoming prevalent, with services like online ordering and real-time tracking enhancing efficiency and customer experience. Key factors behind this growth are the government's economic diversification efforts, infrastructural development, and a young, growing population with evolving lifestyle preferences. The tourism industry, projected to contribute over $70 billion to the GDP, further boosts the demand for catering services. Industries like defense and construction rely heavily on catering to support their large-scale operations, while religious sites see continuous inflow of visitors requiring sustenance. 

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Market Dynamics 

Driver: Government's Vision 2030 Spurring Infrastructural and Economic Diversification

The Saudi Arabian government's Vision 2030 is a transformative plan that aims to reduce the country's dependence on oil by diversifying its economy is projected to remain the key factors behind the growth of the B2B catering services market. This initiative has led to significant investments in infrastructure, tourism, entertainment, and other non-oil sectors. Mega-projects like NEOM, a $500 billion smart city spanning 26,500 square kilometers, and the Qiddiya entertainment city, projected to attract 17 million visitors annually, are prime examples of this vision in action. These large-scale projects require extensive manpower; for instance, NEOM is expected to create over 380,000 jobs. Catering services are essential to support the workforce engaged in these developments, leading to increased demand in the B2B catering sector. The construction of the King Abdullah Financial District, covering 1.6 million square meters, similarly boosts the need for high-volume catering solutions.

Furthermore, the government's push to elevate the tourism sector aims to attract 100 million annual visits by 2030. This objective not only amplifies the need for hospitality services but also for catering providers to service hotels, events, and tourist attractions. The cumulative effect of these initiatives is a robust growth environment for B2B catering services in the country.

Trend: Emphasis on Health, Hygiene, and Food Safety in Catering Operations

In recent years, there has been a significant shift towards prioritizing health, hygiene, and food safety within the B2B catering services market. This trend has been accelerated by global health events that have heightened awareness around sanitary practices. In response, the Saudi Food and Drug Authority (SFDA) has implemented stricter regulations, and catering companies are adhering to international standards like ISO 22000 for food safety management systems.

Companies are investing in training for their staff on hygiene practices and are incorporating advanced kitchen equipment to ensure food safety. The use of personal protective equipment (PPE) has become standard, and regular health screenings for employees are being conducted. For example, major catering firms  in Saudi Arabia B2B catering services market now conduct bi-weekly health checks for their staff, enhancing trust with their clients. This emphasis on safety not only protects consumers but also builds reputation and competitiveness in the market. Clients are more inclined to engage with catering services that demonstrate a commitment to high health and safety standards, influencing contract decisions and long-term partnerships.

Challenge: Supply Chain Disruptions Affecting Consistency of Service Delivery

Supply chain disruptions present a significant challenge to the B2B catering industry in Saudi Arabia. Factors such as global trade tensions, fluctuating oil prices, and logistical issues can lead to inconsistencies in the availability of essential ingredients and supplies. For instance, delays at ports or customs can result in shortages of imported goods like specialized meats or dairy products, which are crucial for certain menus. Local agricultural output, while growing, may not always meet the demands of large-scale catering operations, particularly during peak seasons in the B2B catering services market. In 2023, weather anomalies led to a 15% drop in domestic vegetable production, impacting local supply chains. Such disruptions compel catering companies to find alternative suppliers rapidly, which can increase costs and affect menu offerings.

To mitigate these challenges, catering firms are diversifying their supplier base, increasing inventory levels of non-perishable items, and investing in supply chain management technologies. However, these solutions also require additional resources and strategic planning, emphasizing the need for resilience and adaptability in the industry.

Segmental Analysis 

By Type 

As of 2023, contract catering in Saudi Arabia B2B catering services market has seen remarkable growth, contributing over US$1,680 million to the market revenue. This surge is driven by the Kingdom's ambitious Vision 2030 initiative, which aims to diversify the economy and reduce dependence on oil. The number of mega-projects, such as NEOM and the Red Sea Project, has increased, requiring extensive catering services for thousands of workers. Additionally, the corporate sector expanded with over 1,300 multinational companies operating in the country, fueling the demand for professional catering services to enhance employee satisfaction and productivity.

Contract catering has become more attractive in Saudi Arabia's B2B catering services market due to its ability to provide tailored, efficient, and large-scale food solutions across various industries. The workforce population has grown to over 13 million people, including a significant expatriate community of 10.5 million, which has diversified culinary preferences and dietary requirements. Key factors behind this growth include increased investments in infrastructure projects worth over US$500 billion, a booming events industry projected to reach US$4.5 billion by 2030, and government support for private sector participation in service delivery.

Key contract caterers in the country, such as Saudi Airlines Catering Company (SACC), Tamimi Group, and Rezayat Catering, are responding to this burgeoning demand by expanding their operations and enhancing service quality. These companies are adopting advanced technologies, like automated kitchen systems, and adhering to strict food safety standards set by the Saudi Food and Drug Authority (SFDA). Employment in the catering sector has increased, with over 60,000 employees working to meet the growing demand, indicating the industry's robust response to market needs.

By Services 

In 2023, in-flight catering stands at the forefront of Saudi Arabia's B2B catering services market with revenue contribution of US$ 441.7 million in 2023. This dominance is fueled by the country's strategic position as a global aviation hub and the significant increase in air travel. Saudi Arabian airports handled over 100 million passengers in 2023, with major airports like King Abdulaziz International Airport and King Khalid International Airport witnessing unprecedented growth. The national carrier, Saudia, along with other airlines, operated more than 700,000 flights domestically and internationally, substantially boosting the demand for in-flight catering services. In-flight catering is in high demand due to the rise in both domestic and international tourism. The number of international tourists visiting Saudi Arabia reached 18 million in 2023, spurred by eased visa regulations and the promotion of tourism under Vision 2030. Domestic tourism also flourished, with over 23 million local tourists traveling within the Kingdom. Major events like the Riyadh Season and the Jeddah Festival attracted millions of visitors, increasing flight frequencies and necessitating quality in-flight meals to enhance passenger experience.

The dominance of in-flight catering affects the B2B catering services market significantly. Catering companies like Saudi Airlines Catering Company and Newrest are scaling up operations to meet the heightened demand, with SACC serving over 50 million meals annually. Investments in state-of-the-art facilities, such as the US$80 million catering unit at King Abdulaziz International Airport, have been made to improve capacity and efficiency. These developments have led to the employment of more than 15,000 staff in the in-flight catering sector, underscoring its pivotal role in the industry's growth in 2023.

By End Users

The healthcare sector with over US$ 313.8 million in revenue is the largest consumer of B2B catering services market in Saudi Arabia as of 2023. This is due to the extensive network of over 500 hospitals and 2,300 primary healthcare centers across the country needing specialized catering services. The sector's dominance is propelled by factors like a growing population exceeding 35 million people, an aging demographic, and increased prevalence of chronic diseases, leading to a higher number of hospitalizations exceeding 1.5 million patients annually. In addition, a significant government investment exceeding US$50 billion in healthcare infrastructure and services. The focus on patient care quality necessitates the provision of nutritious and varied meal options, adhering to strict dietary requirements. Major factors compelling the segment's dominance are the macroeconomic goal of improving public health and microeconomic factors like individual dietary needs. The sector employs over 450,000 healthcare professionals, all of whom require reliable catering services.

The large patient population affects the dominance of healthcare consumers in the B2B catering services market by increasing the demand for tailored catering solutions. Specialized diets for patients with diabetes, heart conditions, and other illnesses require caterers to provide over 250,000 specialized meals daily. Catering companies are investing in nutritionists and dieticians, with over 1,000 experts employed to ensure meal compliance with medical standards. This focus on patient nutrition and satisfaction drives the healthcare sector's leading position in the B2B catering market.

By Contract Length 

In 2023, short-term contracts of less than one year are leading the B2B catering services market in Saudi Arabia. The segment contributed nearly US$ 823.2 million to the regional market. This trend is driven by the dynamic nature of the market and the increasing number of events and projects requiring temporary services. Over 5,000 events, including international conferences and exhibitions like the G20 Summit and the Future Investment Initiative, have created a surge in demand for short-term catering solutions. Additionally, construction projects employing over 3 million workers often necessitate catering services for limited periods.

Short-term contracts are more attractive to end-users due to their flexibility and cost-effectiveness. Businesses can tailor services to specific project needs without long-term commitments, which is particularly beneficial for SMEs constituting over 99% of Saudi businesses. Factors driving segmental dominance include the rapid pace of economic activities under Vision 2030, which has led to an increase in temporary projects and the gig economy. The ability to quickly adjust services in the B2B catering services market according to changing requirements makes short-term contracts a preferred choice. Some of the key factors propelling this trend include government initiatives encouraging private sector participation and the influx of foreign direct investment totaling US$19 billion in 2023. Companies are leveraging short-term contracts to pilot new services, manage budgets efficiently, and mitigate risks. The B2B catering industry has adapted by offering customizable packages, and over 200 catering companies now specialize in short-term contracts, reflecting the market's shift towards more agile and responsive service models.

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Top Players in Saudi Arabia B2B Catering Services Market

• Algosaibi Services Co ltd
• Al Tamimi
• Unique Catering
• Nesma United
• Saudi Airlines Catering Company
• Gulf Catering Company
• Saudi Catering & Contracting Company (SCCC)
• Gulf Mahmal Support Services Company
• Zamil Operations and Maintenance
• Other Prominent Players

Market Segmentation Overview:

By Type

• Contract Catering
• Non-Contract Catering

By Contract length

• Short Term (>1Year)
• Medium Term (1Year)
• Long Term (<1 Year)

By Services

• Corporate Catering
• Conference and Convention Catering
• Boardroom Catering
• Trade Show and Expo Catering
• Construction Site Catering
• Hospital Cafeteria Services
• In-Flight Catering
• Religious Retreats and Events Catering
• Concession Catering
• Government and Defense Catering
• Others

By End User

• Government
• Corporate
• Oil and Gas
• Defence
• Construction
• Religious Sites
• Healthcare
• Educational Institution
• Tourism
• Others