Franchise Registrations Surge 866% in 3 Years

The Ministry of Commerce reported an increase in franchise registrations, with the number rising to 1,788 by the end of the third quarter of 2024. This marks a rise from 185 registrations in the fourth quarter of 2021.

The surge in franchise activity is a sign of the growing entrepreneurial ecosystem, driven by sectors such as tourism, hospitality, retail and transport. The ministry highlighted that tourism, hotels and restaurant activities led the charge, with 1,232 new franchise registrations, followed by the wholesale and retail sector with 689 registrations, and the transport and storage sector with 257.

Regionally, Riyadh saw the highest number of franchise registrations at 647, followed by Makkah with 363, and the Eastern Province with 225. This growth has been attributed in part to the Franchise Law and its executive regulations, which were introduced in 2019 and 2020. These regulations established a clearer framework for the relationship between franchise grantors and franchisees for a more transparent and structured environment for franchise operations.

The Franchise Center, under the Small and Medium Enterprises General Authority (Monsha'at), has played a key role in this expansion by promoting the franchise model, offering services, attracting both local and international investments, and creating new job opportunities.