Rapid Egyptian e-commerce startup, Rabbit, extends its operations into Saudi Arabia
Rabbit, the Egyptian quick-commerce startup, has announced its entry into the Saudi Arabian market in 2025. The company aims to transform the grocery shopping experience for Saudi households, leveraging its dark store and micro-fulfillment technology.
The e-grocery and quick commerce sector in Saudi Arabia is expanding rapidly, with online grocery sales currently accounting for 1.3% of total grocery sales. However, this figure is expected to grow substantially as demand for convenience rises. Even a modest increase to 4% online penetration would create a $2+ billion e-grocery market opportunity. Rabbit sees significant growth potential in Saudi Arabia's $60 billion food and grocery market.
Rabbit's operations in Saudi Arabia have already commenced through a network of dark stores (fulfillment centers) in key neighborhoods. The company is focusing on delivering groceries, food, cosmetics, and other items in 20 minutes or less.
The company faces stiff competition from established players like Careem Market, Jahez, Ninja, Nana, Hungerstation, and Keeta. Careem Market, for instance, has recently launched its 20-minute grocery delivery service in Riyadh, positioning itself strongly thanks to brand familiarity and extensive tech infrastructure.
To build a local Saudi team and establish a strong operational footprint, Rabbit has set up its GCC headquarters in Riyadh. The company aims to fulfill over 20 million orders in the GCC, indicating a substantial operational footprint. The expansion strategy likely involves establishing localized dark stores and fulfillment centers, replicating the model that succeeded in Cairo.
The broader regional tech ecosystem supports talent development, as evidenced by companies like Globant opening innovation hubs in Riyadh focused on training local IT professionals and driving digital solutions. This could create a favorable environment for recruiting skilled staff.
In summary, Rabbit’s expansion into Saudi Arabia taps into a growing market with strong digital infrastructure but must navigate a competitive landscape dominated by major regional players. For successful local team building, Rabbit will likely leverage tech hubs and regional talent initiatives while scaling dark store and fulfillment operations to meet demand.
[1] TechCrunch. (2023). Rabbit, the Cairo-based quick-commerce startup, launches in Saudi Arabia. [online] Available at: https://techcrunch.com/2023/05/10/rabbit-the-cairo-based-quick-commerce-startup-launches-in-saudi-arabia/
[2] MENAbytes. (2023). Rabbit, the Egyptian quick-commerce startup, launches in Saudi Arabia. [online] Available at: https://menabytes.com/2023/05/10/rabbit-the-egyptian-quick-commerce-startup-launches-in-saudi-arabia/
[3] Arab News. (2023). Rabbit sets up GCC headquarters in Riyadh to tap into Saudi Arabia's e-grocery market. [online] Available at: https://www.arabnews.com/node/1916131/business-economy
[4] Gulf Business. (2023). Rabbit launches in Saudi Arabia, targeting $2 billion e-grocery market opportunity. [online] Available at: https://gulfbusiness.com/rabbit-launches-in-saudi-arabia-targeting-2-billion-e-grocery-market-opportunity/
- Rabbit's entry into the Saudi Arabian market signifies an ambitious expansion strategy, targeting the country's $60 billion food and grocery industry, and leveraging the growth potential in the e-grocery sector, which is expected to reach $2+ billion with a 4% online penetration.
- In the competitive landscape of Saudi Arabia's e-grocery market, Rabbit not only faces competition from established players like Careem Market but also has the opportunity to benefit from the favorable tech ecosystem, with initiatives like Globant's innovation hubs training local IT professionals and driving digital solutions.
