Identification of Local Smes’ Development Barriers in Food Service Industry in Kingdom of Saudi Arabia (Ksa)

In: Business and Management

Submitted By LeoVain
Words 8819
Pages 36
Identification of Local SMEs’ Development Barriers in Food Service Industry in KSA, the Western Province (2012)

Identification of Local SMEs’ Development Barriers in Food Service Industry in Kingdom of Saudi Arabia (KSA), The Western Province (2012) By/ Reham H. Al Zahrani

Abstract
This paper examines the actual situation of SMEs performing in local food service industry in Kingdom of Saudi Arabia (KSA). It focuses basically on critical issues that disturb the development of local SMEs. The adopted theoretical framework is SME’s vicious cycle in which all enterprise’s factors are to be investigated. The results were collected from 19 enterprises which are mainly located in the most vivid economic cities in the western province in KSA. The most crucial barriers identified in this research are labor-related issues, product quality issues, governmental issues, marketing issues, business regulation issues, financial issues, competition issues, and technological issues. Finally, the paper provides some recommendations to overcome or minimize the influence of these constraints in order to empower SMEs in Saudi restaurants industry to grow and reach their ultimate potentials.

Key Words: SMEs, barriers, Saudi, KSA, Food Service Industry, Restaurants, development, growth.

1

Identification of Local SMEs’ Development Barriers in Food Service Industry in KSA, the Western Province (2012)

Introduction
Food service industry is one of the most active and productive industry in the national private economy in Kingdom of Saudi Arabia. This particular sector has achieved recently focused attention due to its fast growth compared to other similar markets in the area. The value of investment in the food service industry is expected to reach $29 billion by the year of 2014. Besides, small and medium enterprises occupy 97% of the whole sector regarding the amount of…...

Similar Documents

Saudi Arabia Exports and Imports

...Part I The Kingdom of Saudi Arabia is the largest country in the Arabian Peninsula. Saudi Arabia’s population is 27 million, including 8.4 million foreign residents (2010 census), and its capital city is Riyadh. Saudi Arabia’s geography is diverse, with forests, grasslands, mountain ranges and deserts. The climate varies from region to region. Temperatures can reach over 110 degrees Fahrenheit in the desert in the summer, while in the winter temperatures in the north and central parts of the country can drop below freezing. Saudi Arabia gets very little rain, only about four inches a year on average. Saudi Arabia is a monarchy based on Islam, which in turn has a government that is headed by the King, who is also the commander in chief of the military. One of the few monarchy’s left in the world, their power and influence continues to increase because of their natural resources as well as workforce diversity for foreigners. The King governs with the help of the Council of Ministers, also called the Cabinet (Saudi Embassy). There are 22 government ministries that are part of the Cabinet. Each ministry specializes in a different part of the government, such as foreign affairs, education and finance. Since the beginning of the first Saudi state in the 18th century through the founding of the modern Kingdom of Saudi Arabia by the late King Abdulaziz bin Abdelrahman Al-Saud on September 23, 1932, Shari'ah (Islamic law) has been the pier and source of Saudi Arabia's basic......

Words: 1830 - Pages: 8

Saudi Arabia

...ECONOMICS II THE ACCESSION OF SAUDI ARABIA TO THE WTO ANALYSING THE FUTURE CHALLENGES SUBMITTED BY: AKANKSHA PRAKASH I.D.NO.: 1785 IIND YEAR B.A.LL.B. {HONS.} TABLE OF CONTENTS RESEARCH METHODOLOGY___________________________________________________________2 INTRODUCTION_________________________________________________________________________3 THE ACCESSION OF SAUDI ARABIA TO THE WTO: AN ANALYSIS OF THE FUTURE CHALLENGES____________________________________________________________________________4 • Objectives________________________________________________________________________4  Diversification of the economy______________________________________4  Development of modern infrastructure________________________________4  Access to Foreign Direct Investment (FDI) and modern technologies________4  Enhancement of purchase power of the population_______________________4  Employment Generation___________________________________________5  Maximization of competitive advantage in petrochemicals________________5  Open Access to international Market__________________________________5  Open Access to international Market__________________________________6  Integration of Saudi Arabia’s economy with the global economy____________6 • Reforms__________________________________________________________________________6  Foreign Investment_______________________________________________7  Trade in......

Words: 4341 - Pages: 18

Ksa Market

...STUDY: SAUDI ARABIA Compiled by: Directorate International Trade Sub-directorate: Europe, Russia and Middle East Department of Agriculture, Forestry and Fisheries March 2010 Authors: Mr Gert van Rensburg (GertVR@daff.gov.za) and Ms Joyce Letswalo (JoyceLe@daff.gov.za) Disclaimer The Department of Agriculture, Forestry and Fisheries take no responsibility for any action taken from this study. This is a desktop study and own research must be undertaken, before decisions is made based on this study. SUMMARY1 This country market study of Saudi Arabia examines the trade flows between South Africa (SA) and Saudi Arabia. The major objective of the study is to identify agricultural products that have the potential to be exported to Saudi Arabia. First the study gives a historical background about Saudi Arabia, looks at some country facts, give an economic overview and look at the regional and international relations of Saudi Arabia. Then it examines the trade policy of Saudi Arabia, looks at bilateral agreements between SA and Saudi Arabia and at total trade between these two countries. From here on there is focused on agricultural trade, inter alia taking into account the following: the most important products imported and exported and the trade balance. An analysis is done to determine posible exports to Saudi Arabia. Finally it looks at some trade barriers and a conclusion and some comments are made on trade with Saudi Arabia. The Kingdom of Saudi Arabia (Saudi Arabia) is a......

Words: 19581 - Pages: 79

Saudi Arabia Paper by Mansor Turbo

...Saudi arabia is the largest Arab state in Western Asia by land area, constituting the bulk of the Arabian Peninsula, and the second-largest in the Arab world (after Algeria). It is bordered by Jordan and Iraq on the north and northeast, Kuwait, Qatar, Bahrain and the United Arab Emirates on the east, Oman on the southeast, and Yemen on the south. The Kingdom of Saudi Arabia was founded by Abdul-Aziz bin Saud (known for most of his career as Ibn Saud) in 1932, although the conquests which eventually led to the creation of the Kingdom began in 1902 when he captured Riyadh, the ancestral home of his family, the House of Saud, referred to in Arabic as Al Saud. The Saudi Arabian government, which has been an absolute monarchy since its inception, refers to its system of government as Islamic. The kingdom is sometimes called "The Land of the Two Holy Mosques" in reference to Al-Masjid al-Haram (in Mecca), and Al-Masjid al-Nabawi (in Medina), the two holiest places in Islam. Saudi Arabia has the world's second largest oil reserves which are concentrated largely in the Eastern Province and oil accounts for more than 95% of exports and 70% of government revenue. This facilitates the creation of a welfare state although the share of the non-oil economy is growing recently. It has also the world's sixth largest natural gas reserves. The new kingdom was one of the poorest countries in the world, reliant on limited agriculture and pilgrimage revenues.However, in 1938 vast reserves of......

Words: 1370 - Pages: 6

Food Service Industry

...Aa The Food processing industry has an important role to play in linking the farmers to the final consumers in the domestic as well as the international markets. Food processing combined with marketing has the potential of solving the basic problems of agricultural surpluses, wastages, rural jobs, and better remuneration to the growers. In the next ten years, food production is expected to double. These produces, if processed and marketed smartly, can make India a leading food supplier of the world. India with a population of 1.08 billion (growing at about 1.70% per annum) provides a large and growing market for food products. Food products are the single largest component of private consumption expenditure, accounting for as much as 49.00 per cent of the total spending. Furthermore, the upward mobility of income classes and increasing need for convenience and hygiene is driving demand for (a) perishables and non food staples and (b) processed foods. Also, eating out is a booming practice in urban India and processed foods are accepted as alternative to the home cooked food because of the convenience it offers. Also, with the globalization of trade and availability of high speed logistics, food retailers in developed countries are sourcing an year-round supply of fruits and vegetables from developing countries. Thus, both for local consumption as well for export there is a year round opportunity for fruits and vegetables, meat and poultry products and......

Words: 473 - Pages: 2

Saudi Arabia

...Saudi Arabia is a kingdom that located in the Middle East region. It is the leader country in OPIC and that show’s how large is the Saudi’s economic power. The average of the Saudis are educated. From the beginning history of this kingdom, the government showed the importance of education for both men and women. Decades ago, the Saudi government started a project to give scholarships to the students who wants to complete their education abroad. The Saudi culture is very sensitive issue. Most of the Saudis are conservatives. A lot of changes happened in the Saudi’s economy, education, and cultures after five years of king Abdullah being in charge. The Saudi’s economy had major changes in the last five years. Before, the Saudi’s economy was relying on the oil business. Today, the Saudi economic policy has been changed a lot. King Abdullah established one of the four economic cities. The economic cities are a government development plan for the future. The goal of this plan is to diversify their economy away from oil, by generating foreign interest and bringing big corporations to these economic cities. The Saudi education has been changed to the better during the last decades and it at its best these days. King Abdullah is very interested in the education field. He established international universities for men and women. These universities afford full scholarships to Saudis and international students. Good example of these universities is King Abdullah of Science and......

Words: 597 - Pages: 3

The Impact of Multinational Companies a Case Study of the Energy Industry in Saudi Arabia

...The Impact of multinational companies A case study of the energy industry in Saudi Arabia Abstract Contents 1. Introduction 4 1.1. Rationale of the Research 6 1.2. Aims & Objectives of the Research 7 1.3. Key Research Questions 7 2. Literature Review 9 3. Research Methodology 13 4. Key Findings & Discussion 13 5. Conclusion 16 6. References 16 7. Appendices 16 1. Introduction In this era of globalization, there has been a fundamental change in the way international business is being done. Due to the ease of communication and advances in the sophisticated communication systems more and more companies are becoming global and expanding their operations and creating production facilities away from their home countries. This trend has given rise to today’s Multinational Corporations (MNCs) whose role in the international scene is increasing rapidly. With increased international development and cooperation, the MNCs have been able to create such a network that their budgets, organizational structure and influence on the world trade stage rivals many nations [ (UN Conference Proceedings, 2006) ]. With their immense economic power and strong political connections and the fact that globalization is seen as a “Business driving phenomenon”, MNCs are in a strong position to influence the economies of the......

Words: 3164 - Pages: 13

Azerbaijan and Saudi Arabia

...Country Briefings: Azerbaijan and Saudi Arabia Marvin Labre Sarah Garstecki Kalle Stenbaek Trenton Norton Table of Contents Economic Environment………………………………………………………………………....3 Azerbaijan…………………………………………………………………………….....3 Saudi Arabia………………………………………………………………………….....5 Political and Regulatory Environment...………………………………………………………..6 Azerbaijan………………………………………………………………………………6 Saudi Arabia………………………………………………………………………….....6 Cultural and Societal Framework………………………………………………………………7 Azerbaijan………………………………………………………………………………7 Saudi Arabia………………………………………………………………………….....9 Technological Environment…………………………………………………………………....10 Azerbaijan………………………………………………………………………………10 Saudi Arabia…………………………………………………………………………....10 Conclusion……………………………………………………………………………………...10 References………………………………………………………………………………………12 Economic Environment Azerbaijan Azerbaijan is a developing country that is heavily dependent on the exportation of gas and oil for its economic status. Other forms of sustainable economic consistency are from non-export organizations such as construction, banking, and real estate (CIA: World Factbook). Even in times of various economic trends, the country maintains its middle-class economy through the increase/decrease of the prices of their main resources. It’s from the positively consistent results that the government permits pervasive corruption and structural economic inefficiencies from these local companies to pose as an obstacle to......

Words: 4775 - Pages: 20

Pest Analysis Saudi Arabia

...Saudi Arabia PEST analysis Policital factors Saudi Arabia is politically a very stable country in the Middle East since it is ruled by the Al Saud dynasty's which main goal is to concentrate on modernization and on developing the country's role as a regional power. It is general known that Saudi Arabia is the biggest petroleum exporter in the world which was discovered on March 3rd 1938. Before that the country was only a trade-based economy. The Kingdom is besides a member of the OPEC, the Organization of Petroleum Exporting Countries. It is of importance to mention that Saudi joined the WTO – the World Trade Organization - on 11th December 2005. This well-known organization reviewed the corresponding trade policies and practices in January 2012. Responsible for the developing followed by the realization of Saudi’s trade policies is the Ministry of Commerce and Industry, the MCI. To enter Saudi Arabia by air you will need a Visa and valid passport for at least another six month from the date of entry. The country has two major visa options, a travel and a working one. A working visa which should be applied through a visa agencies accredited to the Royal Embassy of Saudi Arabia. Besides a business partner, any Saudi business that “hold a majority interest in the company”1, is needed, who acts as a sponsor which is required as well for doing business in SA. Be aware, “you may be refused entry to Saudi Arabia if your passport contains evidence of previous travel to Israel or......

Words: 2527 - Pages: 11

Saudi Arabia

...Saudi Arabia Its officially known as the Kingdom of Saudi Arabia, is an Arab state in western Asia Saudi Arabia is the worlds largest oil producer and largest exporter and controls the worlds largest hydrocarbon reserves. Saudi Arabia is a member of Organization of the petroleum exporting countries(OPEC). Saudi Arabia's command economy is petroleum based roughly 75% of budget revenues and 90% of export earnings come from the oil industry. GDP-$648.971billion Trade relations between China and Saudi Arabia China's main exports to Saudi Arabia: automobiles, electronic goods , industrial machinery etc. China main imports from Saudi Arabia: crude oil, liquefied petroleum gas and primary plastics. In 2014 ,Saudi was the 20th and 10th export and import market respectively for China (0.9% of China exports and 2.5% of China imports)..the bilateral trade was $69.1bn and trade balance -$27.9bn Bilateral trade is the exchange of goods and services between countries. Trade balance is the difference between the monetary value of exports and imports of output in an economy over a period of time. China has also undertaken several energy exploration agreement with the Saudi Arabia's government winning the right to explore e.g. in Saudi Arabia's al-khali basin Saudi Arabia agreed to help China develop strategic petroleum reserves and to modernize downstream refining capacity e.g. deal to construct a refinery for natural gas in Fujian province Saudi Arabia is involved in...

Words: 252 - Pages: 2

History of Saudi Arabia

...In pre-Islamic times, apart from a small number of urban trading settlements (such as Mecca and Medina), most of what was to become Saudi Arabia was populated by nomadic tribal societies in the inhospitable desert.[38] The Islamic prophet, Muhammad, was born in Mecca in about 571 A.D. In the early 7th century, Muhammad united the various tribes of the peninsula and created a single Islamic religious polity. Following his death in 632, his followers rapidly expanded the territory under Muslim rule beyond Arabia, conquering huge swathes of territory (from the Iberian Peninsula in west to modern day Pakistan in east) in a matter of decades. In so doing, Arabia soon became a politically peripheral region of the Muslim world as the focus shifted to the more developed conquered lands.[39] From the 10th century to the early 20th century Mecca and Medina were under the control of a local Arab ruler known as the Sharif of Mecca, but at most times the Sharif owed allegiance to the ruler of one of the major Islamic empires based in Baghdad, Cairo or Istanbul. Most of the remainder of what became Saudi Arabia reverted to traditional tribal rule.[40][41] In the 16th century, the Ottomans added the Red Sea and Persian Gulf coast (the Hejaz, Asir and Al-Ahsa) to the Empire and claimed suzerainty over the interior. One reason was to thwart Portuguese attempts to attack the Red Sea (hence the Hejaz) and the Indian Ocean.[42] Ottoman degree of control over these lands varied over the next......

Words: 7082 - Pages: 29

Drivers and Barriers Affecting Development of Wine Industry

...Question: For an industry of your choice, identify and analyse the most important drivers and barriers affecting its development. Answer Drivers and barriers affecting development of any industry revolve in the fraternity of globalization. Globalisation in business is the worldwide movement toward economic, financial, trade, and communications integration (Frank, 1998). It implies the opening of local and nationalistic perspectives to a broader outlook of an interconnected and interdependent world with free transfer of capital, goods, and services across national frontiers. Drivers in the business concept are critical forces which can be built within business strategy to enable a company to attain its set goals (Gilbert, 1994). Barriers to industry development are forces that deters the business organization from attaining the desired goals and these are encountered both in the internal as well as external business environment (Hough et al 2011) It is therefore imperative to evaluate key drivers and barriers affecting development in a bid to craft strategic tools that can stimulate strategic thinking, generate strategic foresight, provide a basis for testing existing strategies, explore and understand complexities of the future (Trompenaar et al, 2003). This can aid decision making and contribute to preparation for the future. As such, this essay seeks to explore key issues in strategic management and key theoretical models in the South African (SA) Wine Industry and......

Words: 3378 - Pages: 14

Gold in Saudi Arabia

...ARB will limit itself to the corporate clients, who buy on a continuous and regular. Seasonal request to buy either gold or silver by private and affluent clients will not be accommodated. 2 – EXECUTIVE SUMMARY 3 – INTRODUCTION Precious metals have been traded for eons. Fairly common are gold and silver which apart from their ornamental value, they have a variety of industrial and commercial uses. Among these precious metals, gold has been chosen as a special interest metal. Gold is a precious metal that a whole industry has developed and evolves into a multibillion-dollar industry led by huge corporations. The gold industry is stratified with many major and minor players working together. Key among these relevant stakeholders includes the mining companies, the gold processing companies, gold traders, and consumers. Gold mining is one of the most intensive, which is carried out extensively around the world. The World Gold Council (WGC), a market development organization, puts the production of gold globally to be in the region of 3,000 Metric tons. The figure produced globally does not meet the quantity demanded. The low supply and high cost of setting up a mine prohibits the possibility of gold reducing in price. The key areas of focus of the new precious metal division of the ARB will be to offer the clients of precious metals affordable rates that are lower than what the competition offers them. At the same time, deliver on authenticity and quality. The ARB......

Words: 1906 - Pages: 8

Road Accidents in Saudi Arabia

...Phones while driving 10 Drunk driving 11 Avoiding Seat Belt or Helmets 11 Youth races and careless driving 11 Improper road structure 12 Effects of Traffic Accidents 13 Social Impacts of Road Traffic Accidents 13 Economic Impacts of Road Traffic Accidents 14 Ways for controlling the traffic accidents 14 INTRODDUCTION INTO THE CEASES OF TRAFFIC ACCIDENTS IN JEDDAH CITY 18 History of the problem in Saudi Arabia 18 The Roads and Public Transport in Saudi Arabia 19 The causes of the Road Traffic Accidents in Saudi Arabia 19 The effects of the Road Traffic Accidents in Saudi Arabia 20 Jeddah City 22 Population 22 Economy 22 Society 22 Road &Traffic Laws in Saudi Arabia (Jeddah) 23 THE USED METHDOLGIES AND ANALYSIS OF DATA 23 The different used methodologies for gathering the data 23 Analysis of international data 24 Analysis Middle East data 27 Analysis Saudi Arabia and Jeddah data 28 CONCLUSION/RECOMMENDATION 29 REFERENCES 31 Literature Review INTRODUCTION TO ROAD TRAFFIC ACCIDENTS Safety According to Security Industry Association (SIA 160), safety is defined as; “Adequate safety with respect to a hazard is ensured provided that the hazard is kept under control by appropriate measures or the risk is limited to an acceptable value. Absolute safety is not achievable.” (Schneider, 1997) According to Wildavsky (1988), Safety is a protective measure to ensure the chances of unfortunate incidents are kept at minimum. As the......

Words: 11782 - Pages: 48

Saudi Arabia

...religious beliefs, traditions, work ethic ( culture) The full name of Saudi Arabia is the Kingdom of Saudi Arabia. Arabic is the official language. In the 7th century, the successor of the Mohammed who was the founder of Islam established Arab empire. The 8th century is a heyday for Saudi Arabia, and its territory crosses Europe, Asia and Africa. However, in the 16th century, Arab empire was ruled by the Ottoman Empire. In the 19th century, The Great Britain invaded into Arab, it was divided into two parts, Hejaz and Nejd. In 1924, the chief of Hejaz in Saudi Arabia merged Nejd and then gradually unified the Arabian Peninsula. Finally, in September 1932, he declared the establishment of Saudi Arabia kingdom. Saudi Arabia is the birthplace of Islam. Islam has become the world’s second large religion. The founder Muhammad established Islam approximately A.D 600 in Mecca; the sacred city of Islam is located in Saudi Arabia. Islam prospers in northwestern Africa, the Middle East, Central Asia, Pakistan, and some Southeast cities. Religion strongly affects consumption behavior of Arabian. For example, Muslim consumers are not allowed to consume alcohol and pork, besides that, the nation is governed under the Law of Islamic. Muslim pray five times a day, the local people usually go to the mosque to do religious service. Women must wear black robes in that day. Some of the traditions and customs in Saudi Arabia are similar to the other countries, but some of them are......

Words: 2053 - Pages: 9