The Gulf Cooperation Council (GCC) is undergoing a retail transformation, with the market projected to expand at a compound annual growth rate (CAGR) of 4.6% to surpass $390 billion by 2028, according to insights from LOGIC Consulting.
Saudi Arabia and the United Arab Emirates continue to anchor the sector, jointly accounting for 75% of total retail sales in 2023, with their combined share forecast to rise to 78% by 2028.
The GCC’s retail landscape comprises two main segments—food retail and non-food retail—each following distinct growth trajectories driven by demographic shifts, rising incomes, and evolving consumer expectations.
Food Retail Segment
Valued at $127.2 billion in 2023, the food retail sector is on track to grow to $162 billion by 2028, supported by a CAGR of 4.9%. Robust population growth, urbanization, and heightened consumer interest in organic and healthier products are fueling demand.
Saudi Arabia, in particular, is witnessing strong momentum in wellness-focused grocery spending, with international health food brands expanding their presence. The rise of hypermarkets and supermarkets such as Carrefour, Lulu, and Al Othaim, combined with online grocery platforms and AI-powered delivery services, is reshaping the way consumers shop.
Non-Food Retail Segment
Non-food retail, covering categories like fashion, electronics, furniture, and luxury goods, generated $182.5 billion in 2023 and is projected to climb to $243.6 billion by 2028, achieving a CAGR of 6.2%.
This growth is largely driven by rising disposable incomes and an increasing appetite for premium products. Recent surveys indicate that 70% of GCC consumers report higher spending on luxury items, underscoring demand for brands such as Louis Vuitton, Gucci, and Rolex.
Six Emerging Trends Driving Retail Evolution
Quick Commerce:
Fast delivery of groceries and essentials is reshaping food retail, catering to urban consumers seeking convenience in cities like Dubai and Riyadh.E-Commerce & E-Payments:
Online shopping continues to surge across all categories, supported by seamless payment options such as Apple Pay and STC Pay.Phygital Experiences:
Hybrid digital-physical shopping is gaining traction, particularly in non-food sectors, as younger consumers embrace interactive, personalized retail environments.Value-Driven Retail:
Private-label products and discount formats are growing, especially in food retail and increasingly in beauty, apparel, and home goods as shoppers seek affordable premium alternatives.Sustainability:
Demand for organic foods and sustainable products is reshaping sourcing strategies. Clean beauty and sustainable fashion are also accelerating in popularity.Luxury & Immersive Shopping:
Global luxury brands are expanding flagship stores and immersive retail experiences across the region, fueling growth in apparel, beauty, and high-end markets.
Together, these trends reflect a dynamic, rapidly evolving retail sector in the GCC—one that is blending technology, premium offerings, and sustainability to meet the expectations of modern consumers.
Source: LOGIC Consulting
