The Saudi restaurant business is flourishing, filled with the scent of spices, the sound of frying grills, and content guests. Because the younger generation has more disposable income and prefers to try new foods, the state is a great place for restaurant owners to expand.

The restaurant market in Saudi Arabia is estimated by Mordor Intelligence to be valued USD 23.2 billion as of 2023 and is expected to grow at a compound annual growth rate (CAGR) of 7.3 percent to reach USD 3.3 billion by 2028.

Entering this dynamic sector demands comprehensive research and planning. You’ll comprehend the crucial elements needed to launch a restaurant in Saudi Arabia.

How to Start a Restaurant Business in Saudi Arabia?

The steps to start a restaurant in Saudi Arabia are mentioned below:

Select a Business Structure

Before opening a restaurant in the country, it is necessary to select a business structure.

Establish Your Business

Your restaurant must be registered with the Saudi Arabian Ministry of Commerce and Investment. The registration process requires the submission of documents to the authority either online or in person.

Venue and Property

One of the essential factors for starting a restaurant business is its location. Get the necessary permits from the authorities once the location is decided. While selecting a property, consider factors such as –

>Accessibility

>Foot Traffic

>Parking etc.

Register the Restaurant’s Name

Select a brand-new name that suits the restaurant. Next, register the restaurant’s name with the Ministry of Commerce and Investment (MCI).

Secure a Commercial Registration (CR)

Restaurants must secure commercial registration to operate legally in Saudi Arabia. Registration can be done at the MCI.

Food Handling Permits

You must obtain a food handling permit from the Saudi Food and Drug Authority (SFDA). The permit contains certificates of the following –

>Cleanliness.

>Food Safety Training.

>Following Food Storage Guidelines.

>Following Food Preparation Standards.

Approval from the Health Department

The Saudi Health Department will conduct an inspection of the eatery to ensure the health and safety rules are followed. After inspection, you will receive approval from the authority.

Obtain Necessary Licenses

The applicant needs to obtain the necessary business licenses and permits in order to start operating. Secure licenses such as –

General Business License Permit for Outdoor seating, Permits for Live Music, etc.

Cost of Opening a Restaurant in Saudi Arabia

Starting a restaurant in Saudi Arabia requires significant financial investment. The costs involved can vary widely depending on several factors, including:

• Restaurant Size: Larger restaurants will naturally have higher costs.
• Restaurant Type: The type of cuisine and dining experience offered will influence costs.
• Location: Prime locations in popular areas will be more expensive.
• Design: The interior design and decor of the restaurant can add to the overall cost.

There are two main types of costs:

• One-time Costs: These are expenses incurred once when setting up the restaurant. Examples include:
• Recurring Costs: These are ongoing expenses that continue after the restaurant opens. Examples include:

Benefits of Starting a Restaurant in Saudi Arabia

Despite the costs, there are many advantages to opening a restaurant in Saudi Arabia:

• Growing population with disposable income: A large and growing population with spending power provides a potential customer base.
• International tourism: Saudi Arabia attracts visitors from around the world, creating opportunities for restaurants to cater to diverse tastes.
• Expanding market: The Saudi Arabian economy is continuously growing, offering potential for restaurant businesses to thrive.
• Government support: The government provides various incentives and support programs to encourage entrepreneurship in the food industry.
• Tech-savvy population: The Saudi population is increasingly tech-savvy, which can be beneficial for restaurant operations and marketing.
• Strategic location: Saudi Arabia’s geographical location and its role as a regional hub can attract international food brands and tourists.
• Tax benefits: The government may offer tax incentives or exemptions to certain types of businesses, including restaurants.

Simplify your restaurant launch with Arab Dreams. Contact us for a free consultation.