Report Coverage
This report focuses primarily on the retail of food in Egypt, current conditions and factors influencing the sector’s success. It contains profiles of 12 companies including UAE-based Majid Al Futtaim, which holds the Carrefour franchise in Egypt and growing local and regional chains such as Metro and Spinneys.
Introduction
This report focuses on the wholesale and retail of food in Egypt. The sector has been under pressure since the floating of the Egyptian pound in 2016 which drove up inflation and put pressure on import prices. This was coupled with the introduction of value-added tax and government withdrawal of several fuel and food subsidies. The retail food sector is estimated to be worth US$23.73bn. The retail sector as a whole is expected to see an increase in demand and growth as upward price pressures are easing. Micro-enterprises dominate food retailing, while the few local supermarket chains account for 2% of food retail outlets and 20% of food sales. Despite the risks associated with the country, it is considered to have great potential as it has the largest market in the Arab world with a population of 90 million people.
Strengths
• Egypt has a growing retail market which has to cater for a population of nearly 100 million people.
• Egypt’s central location in the MENA region has allowed food processors and distributors to increase exports to nearby regional markets.
• In almost every Arab and African country, Egyptian processed and manufactured food products are import duty-exempt.
• The economy is expected to improve.
Weaknesses
• A complex regulatory system.
• An estimated 98% of food retail occurs via small, traditional, grocery retailers, street vendors and unregulated markets.
• High inflation has put pressure on prices.
• High youth unemployment and low female employment.
• Infrastructure limitations, which have resulted in distribution and supply problems, as well as increased costs.
• The sector is reliant on imported foodstuffs.
Opportunities
• Government’s commitment to promoting foreign investment and involvement such as the new investment law.
• Growth in online food retail.
• Increase in formal retail space and a growing shopping centre culture among the under-35 age group.
• Market share growth in the middle- and upper-market.
• Potential to formalise the large informal market.
• The growth in the urbanised middle class, which should lead to growth in formal retail.
Threats
• Competition from large competitors such as Spinneys, Carrefour, Metro.
• For supermarkets and hypermarkets, continuing strong loyalty from customers to their local grocery store.
• Increasing food prices can put pressure on volume growth.
• Security threats in shopping malls and markets.
• Terrorist attacks.
• Worsening economic conditions with high inflation, foreign exchange concerns, low economic growth and high unemployment.
Outlook
Inflation continues to affect the grocery retail sector. The number of outlets decreased marginally in 2017, as did sales in nominal terms. Modern retailers experienced growth in outlets and sales, while the tradition sector declined. Given that Egypt is the fastest growing economy in the Arab world and has Africa’s second largest population, the grocery sector is forecast to recover in the near future. Large supermarkets chains are expected to continue to take market share from traditional grocers. The Egyptian government has passed new laws to modernise and reduce barriers for international companies investing and operating in the country. These aim to expand economic growth, increase domestic production and exports, boost foreign investment and boost employment. The Egyptian retail market is modernising and opportunities in grocery retail have increased with the growing shopping mall culture. With a large youthful and technologically literate population, many retailers can expect to generate an increasing proportion of their sales online in future and will have to make use of a variety of social media channels to reach customers.
The Wholesale and Retail of Food in Egypt
2019
Full Report
R 1 900.00(ZAR) estimated $102.40 (USD)*
Industry Landscape
R 1 330.00(ZAR) estimated $ 71.68 (USD)*
Table of Contents
[ Close ]| PAGE | ||
|---|---|---|
| 1. | INTRODUCTION | 1 |
| 2. | DESCRIPTION OF THE INDUSTRY | 1 |
| 2.1. | Industry Value Chain | 2 |
| 2.2. | Geographic Position | 3 |
| 3. | SIZE OF THE INDUSTRY | 4 |
| 4. | STATE OF THE INDUSTRY | 7 |
| 4.1. | Local | 7 |
| 4.1.1. | Corporate Actions | 13 |
| 4.1.2. | Regulations | 13 |
| 4.1.3. | Enterprise Development and Social Economic Development | 15 |
| 4.2. | Continental | 16 |
| 4.3. | International | 18 |
| 5. | INFLUENCING FACTORS | 19 |
| 5.1. | Economic Environment | 19 |
| 5.2. | Government Initiatives | 20 |
| 5.3. | Transport Infrastructure | 22 |
| 5.4. | Information Technology, Research and Development (R&D) and Innovation | 24 |
| 5.5. | Labour | 25 |
| 5.6. | Cyclicality | 27 |
| 5.7. | Environmental Concerns | 27 |
| 5.8. | Terrorism and Corruption | 28 |
| 5.9. | Electricity Supply | 29 |
| 6. | COMPETITION | 30 |
| 6.1. | Barriers to Entry | 31 |
| 7. | SWOT ANALYSIS | 32 |
| 8. | OUTLOOK | 32 |
| 9. | INDUSTRY ASSOCIATIONS | 33 |
| 10. | REFERENCES | 33 |
| 10.1. | Publications | 33 |
| 10.2. | Websites | 34 |
| APPENDIX 1 | 35 | |
| Summary of Notable Players | 35 | |
| COMPANY PROFILES | 37 | |
| BIM BIRLESIK MAGAZALAR A.S. | 37 | |
| EGYPT FREE SHOPS COMPANY S.A.E | 40 | |
| EMARAT MISR PETROLEUM PRODUCTS COMPANY | 43 | |
| EXXONMOBIL EGYPT (S.A.E.) | 45 | |
| FATHALLA GOMLA MARKET | 47 | |
| HYPERONE | 50 | |
| LA POIRE | 52 | |
| LULU GROUP INTERNATIONAL LLC | 54 | |
| MAJID AL FUTTAIM HOLDING LLC | 57 | |
| METRO MARKET FOR TRADING AND DISTRIBUTION | 61 | |
| PANDA RETAIL COMPANY | 63 | |
| SPINNEYS EGYPT LTD | 65 |
