Saudi success comes with sprinkles for Baskin Robbins

Food costs have helped inflation hit a 13-month high in Saudi Arabia but consumers may take some solace in the probable cooling of prices for one foodstuff - ice cream. Baskin Robbins has launched a major push into Saudi Arabia, with about 30 stores planned from a total of 50 openings for the Gulf region. It will also see competition from Dairy Queen, which is also planning to expand throughout the country.

With more than a third of its 29 million people under the age of 14 and summer temperatures that can hit 50°C, Saudi Arabia is an ice-cream retailer’s dream market.The rapid growth of cities and economic zones is also boosting retail demand, says Georgie Thomas, the marketing manager of the Galadari Ice Cream Company.“Some huge cities are coming up, some financial districts are coming up,” Mr Thomas said. “There is a lot of very solid growth coming.”

But property development is also contributing to inflation in the kingdom. The inflation rate rose to 5.5 per cent last month from 5.4 per cent in May, the central department of statistics says.Although the rate of inflation has been accelerating in Saudi Arabia since late last year, the country’s central bank last month said it did not expect acute inflationary pressure in the second quarter of the year.

The Galadari Ice Cream Company, which has the Baskin Robbins franchise across the region, has about 430 stores across the Gulf. It is also expanding in the UAE this year with 12 new stores, Mr Thomas said.But as the construction of new shopping centres in Dubai has slowed and with more yet to be built in Abu Dhabi, it is concentrating on the new suburban areas of Dubai such as Dubai Motor City.The group is also focusing on smaller cities in the Emirates including Al Ain, Fujairah and Khor Fakkan, Mr Thomas said.

The Galadari Ice Cream Company is also planning three new stores each for Qatar, Bahrain and Oman, he said. But in the long-term, Saudi Arabia will be the company’s focus.“We’ve got enough stuff to do in Saudi for the next five years,” Mr Thomas said.

Source: www.thenational.ae

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