Retail fashion sales in Saudi Arabia are expected to surge 48% to $32 billion from 2021 to 2025, representing an annual growth rate of 13% and luxury retail posting a 19% growth, according to a new report unveiled at Paris Fashion Week.

 

This growth is expected to be fuelled by the kingdom’s economic expansion and growing population with apparel, accessories, footwear and luxury goods poised for significant gains. 

 

Saudi Arabia’s fashion industry holds the largest projected growth rates of any other large, high-income market, the report said. 

 

Sector opportunity

A first of its kind focusing on the Saudi Fashion ecosystem, ‘The State of Fashion in the kingdom of Saudi Arabia’ clearly outlines the scale of the sector’s opportunity.

 

With the Saudi fashion industry estimated to employ some 230,000 people, or 1.8% of the domestic workforce, in 2022 it contributed $12.5 billion, or 1.4% of GDP. The kingdom’s investment in education equals 19% of the nation’s total government expenditure on education initiatives. Currently, there are 12 universities in the kingdom offering Bachelors, Masters and PhD programmes in fashion-related fields.

 

Saudi Arabia has invested significantly in its talent pipeline through well-funded scholarship programmes to enable its students to study both local and international prestigious universities, building on the nation’s ability to produce world-class designers. 

 

Scaling up

Annually, Saudi Arabia imports more than $7 billion of fashion products, representing a significant opportunity for manufacturers, logistics providers and specialist machinery suppliers over the next decade, as the kingdom seeks to rapidly scale up capabilities. 

 

For context, a 20% displacement of fashion imports into the kingdom at 2021 levels would generate additional local manufacturing sales of $1.3 billion.

 

Last year, Saudi had the highest annual growth rate of the world's 20 biggest economies, growing 8.7% as high oil prices boosted revenue. The size of its non-oil economy is growing, mainly driven by the private sector, and fashion has the potential to be a major economic driver.

 

Burak Cakmak, CEO of the Fashion Commission, said: “The ‘State of Fashion in the kingdom of Saudi Arabia’ report tangibly demonstrates what we have long known to be true: the scale of the opportunity that now exists for Saudi Arabia’s emerging domestic fashion industry can hardly be overstated.

 

Catalytic role

The Fashion Commission is playing a catalytic role in shaping the future of the fashion industry in the kingdom. A world-class fashion industry that supports Vision 2030’s goals, while celebrating and putting a modern, international twist on the kingdom’s vast culture and heritage, is not only realizable, but realistic.

 

“Saudi Arabia’s fashion industry is well-positioned to succeed. We are building the foundations for a robust, internationally networked value chain. Our vision is to develop a circular and sustainable industry, with a robust regulatory system, which allows local brands to share their identity with the rest of the world and presents opportunities for global brands and entrepreneurs.”

 

The comprehensive report provides a detailed overview of the industry’s size, growth, and key trends, along with an analysis of the competitive landscape, consumer preferences, emerging designers and sustainable practices within the sector. 

 

It also showcases the unique cultural influences and talent that make Saudi's fashion industry distinct and vibrant.

 

Saudi 100 brands programme

The Commission’s Saudi 100 brands programme has put its designers on the global fashion stage, taking the designers to major fashion events in New York, Paris and Milan, clearly demonstrating that Saudi is increasingly an integral part of the global fashion scene.

 

Laure Heriard Dubreuil, Founder and CEO of The Webster, said: “Over recent years, we have witnessed the extraordinary transformation of Saudi Arabia’s role in fashion. The transition from a predominantly domestic-focused market, to one that is now participating on the global stage, demonstrates a clear intention to invest in the industry.

 

“The report, and its manifestation in a unique design is but one example of what we can expect from Saudi’s burgeoning fashion scene, as the Fashion Commission continues to drive progress.”

 

The report showcases the transformative nature of Saudi’s cultural development. As a key pillar of the Saudi Vision 2030 plan, the government is creating a healthy and vibrant society, encouraging people to get active.  

 

Sportswear and general athleisure apparel

As a result of this, sportswear and general athleisure apparel have become a fast-growing product category in Saudi with $1.4 billion in sales in 2022 and it is expected to grow 21% by 2027. In 2022, Adidas Group, Nike and Puma goods accounted for more than 50% of total sales in Saudi.

 

The report also details new opportunities to invest heavily in sustainability as the kingdom takes decisive steps towards a more sustainable future. The use of environmentally sustainable materials, securing zero waste to landfill, and designing recyclable products, represent the top three areas of focus for the Saudi fashion ecosystem.

 

Launched at a celebratory showcase at Paris Fashion Week, the report was unveiled in the form of a one-of-a-kind book woven with materials designed by one of Saudi’s esteemed fashion power houses, Atelier Hekayat, into a dress. Celebrating the arrival of Saudi design on the global fashion stage, the design process embraced the fusion of tradition and innovation in the realm of fashion, while emphasising how Saudi is propelling itself towards the future. 

 

Saudi Fashion Insights

With the unveiling of the report, the Saudi Fashion Commission also announces the launch of Saudi Fashion Insights, the leading platform for understanding the current state of the Saudi Fashion ecosystem. 

 

It will house key insights into ongoing trends at a country and regional level and will seek to empower local and international fashion stakeholders. It will enable fashion houses, designers, investors, and policymakers to make strategic decisions based on reliable and up-to-date information, with regular updates to create a deep data repository.-- TradeArabia News Service