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In-Depth Analysis of the COVID-19 Impact on the Saudi Dry Logistics and Warehousing Market: Ken Research

09-24-2020 01:46 PM CET | Advertising, Media Consulting, Marketing Research

Press release from: Ken Research Pvt Ltd

In-Depth Analysis of the COVID-19 Impact on the Saudi Dry

COVID-19 outbreak is impacting global transportation, shipping and ports across the world with Saudi Arabia being no exception. The Kingdom of Saudi Arabia closed all land borders for people travelling between the cross-border countries such as Kuwait, UAE & Bahrain. However, the restriction did not apply to commercial vehicles carrying commercial goods, which are subject to strict screening procedures at dry ports / land borders. Multiple sectors felt the blow in the form of interferences within the cash flow and business operations as the outbreak caused forcing employees to work from home, while others contribute to unemployment levels in the country. Saudi Arabia is one of the leading economies among GCC countries owing to rich oil reserves however, drop in oil-based revenues and economic diversification towards non-oil based revenue has forced KSA to further reduce its overall expenditures.

Current Position:-
The pandemic continues to take its toll on both large international as well as domestic firms which will face long road to recovery after being constantly hungry for profits for an unknown period of time. Businesses must evaluate financial / operational challenges caused by COVID-19 while rapidly addressing the needs of their clients / end users and suppliers. The Ministry of Foreign Affairs announced the suspension of travel for the KSA citizens / residents to and from UAE, Kuwait, Lebanon, Syria, South-Korea, Egypt, Italy and Iraq via air and sea for evacuation purposes, trade purposes and commercial shipping. Also, the Saudi Ports Authority (MAWANI) issued a circular to all the ports, agents and port operators stating preventive measures to be followed for vessels & crew members coming into the KSA.

Impact on Logistics Business:-
The impact of COVID-19 has highlighted the need for development & implementation of supply chain risk management with strategic initiatives. For instance, Technological integration to the supply chain network will help to mitigate the risks and streamlining processes in the future. Cargo was backlogged at KSA’s major container ports followed by travel restrictions leading to a shortage of truck drivers’ to pick up containers, and ocean carriers canceled sailings. Additionally, the logistics sector has been affected by the new Saudization law that has increased labor costs by 15%. The Saudi customs authority has restricted freight forwarders to only 2 brokers from each company at all ports of entry, which is causing delays in freight clearances via sea and air ports. Free time has been extended in all air and seaports to 10 days from freight arrival. Also, the warehousing rents dropped by approximately 10-15% with an average lease rates for conventional warehouse dropped from SAR 150-155 per sqm to SAR 130-135 per sqm. Slowdowns in economic growth will likely slowdown the development of warehouses in the next 5 years. As a result of which, the future supply is expected to be limited as developers delay development of new projects until market conditions progress.

For More Information on the research report, refer to below link:-
https://www.kenresearch.com/automotive-transportation-and-warehousing/logistics-and-shipping/saudi-arabia-dry-logistics-and-warehousing-market-outlook-to-2025/366821-100.html

Measures Undertaken:-
International Air Transport Association (IATA) called for aviation-specific financial relief measures from the KSA government to address severe impact of COVID crisis on the aviation sector. It has also provided support for air transport by suspending the airport slot use rules for the summer season and extending licenses and certifications for crew, trainers and examiners.

Increasing adaptation of E-Commerce as a result of restrictions posed by the COVID-19 pandemic will bring change in terms of consumer buying behavior. Big retailers for instance, Carrefour and Abu Dawood reported surge in online sales of up to 200-300% in 2020 and further expect an escalating growth trajectory over the long-term therefore, contributing towards last mile delivery. As a result, companies are implementing same day delivery model as a response to changing demands.

National Industrial Development and Logistics Program launched under Saudi Vision 2030 is focused on transforming Saudi Arabia into an industrial powerhouse therefore, contributing towards improving their logistics operations.

Shifts in the Industry Practices:-
The government’s rising focus towards non-oil based sectors, implementation of omni-channel networks, and supply chain revisions will reflect the desired structural changes in the warehousing/storage industry as the market is expected to evolve post lockdown situation. Rising levels of technological collaborations also took place during this year. Potential influx of Foreign Direct Investments paired with investments in infrastructure and logistics capabilities & capacities will provide new opportunities in the near future. Adoption of supply chain digitization among freight forwarders coupled with rising warehousing automation will bring in improvement. Saudi Arabia government is also planning investment towards new logistics parks to boost the country’s economy.

Key Segments Covered in KSA Dry Logistics Market:-
Service Mix
Freight Forwarding
Warehousing
Value Added Services
Regions:-
Jeddah
Riyadh
Dammam
Rabigh
Others (Al- Khobar, Medina, Tabuk and several other cities)

KSA Dry Freight Forwarding Market:-
Mode of Freight
Road Freight
Air Freight
Sea Freight
Rail Freight
International and Domestic Freight
Road Freight
Air Freight
Sea Freight
International and Domestic Companies
Flow Corridors (International Freight)
Asian Countries
European Countries
Middle East
NAFTA (North American Free Trade Agreement)
Other Regions (Africa and South America)

KSA Dry Warehousing Market:-
Business Model
Industrial / Retail
Container Freight / Inland Container Depots
End Users
Construction Material / Industrial
Consumer Retail
Food and Beverage
Healthcare
Automotive
Others (Agriculture, Chemicals and Rest)
Entities
Real Estate Companies
Captive Companies
Logistics Companies
Cities
Jeddah
Riyadh
Dammam
Others (Al-Khobar, Medina, Tabuk and other cities)

KSA Customs Clearance Market:-
Overall Value Added Services
Customs Clearance Revenue by Sea
Customs Clearance Revenue by Air
Transhipment Cargo Volume
Discharged Transhipment Containers
Loaded Transhipment Containers

Key Target Audience:-
International Domestic Freight Forwarders
Warehousing Companies
Logistics Companies
Logistics Consultants

Time Period Captured in the Report:-
Historical Period: 2014-2019
Forecast Period: 2019–2025

Companies Covered:-
Karsf
LSC
JAS
Arabco
Mubarrad
Bahri
Defaf logistics
Wolf Logistics
Namma Cargo
Almajdieou
Al Ayed
Agility logistics
Four winds logistics
Globus Logistics
Space logistics
Atlas world
Uniworld Freight Services
Hellman
BAFCO International Logistics and Shipping Co.
Hala Supply Chain
RAZ
Gulf system
Platinum shipping and logistics
MSC
OCSCL (Oriental Commercial & Shipping)
NTF Group
Abdui Global
Al rashed
GAC
Kanoo terminal Services

Online Retail Companies Covered:-
Carrefour
Panda Retailing
Abdullah Othaim Market
Danube
Tamimi Market
Lulu Hypermarkets

Key Topics Covered in the Report:-
Saudi Arabia Overview and Major Economic Zones
Saudi Arabia Dry Logistics and Warehousing Market
Trade Scenario
Saudi Arabia Dry Freight Forwarding Market
Saudi Arabia Dry Warehousing Market
Snapshot on Saudi Arabia Customs Clearance and Transhipment Market
Industry Analysis (Decision Making Process, SWOT Analysis, VAT Impact and Law of Public Transport on Roads of KSA)
Cost of Setting up a Logistics Business in Saudi Arabia
Comparative Landscape – KSA Dry Logistics Market
Comparative Landscape in Saudi Arabia Online Retail Market
Recommendations / Success Factors
Research Methodology
Appendix

Related Reports:-
https://www.kenresearch.com/automotive-transportation-and-warehousing/logistics-and-shipping/philippines-logistics-market-outlook-to-2024/342232-100.html

https://www.kenresearch.com/automotive-transportation-and-warehousing/logistics-and-shipping/india-road-freight-market-outlook/338096-100.html

Contact Us:-
Ken Research
Ankur Gupta, Head Marketing & Communications
Ankur@kenresearch.com
+91-9015378249

Ken Research Pvt. Ltd.,
Unit 14, Tower B3, Spaze I Tech Business Park, Sohna Road, sector 49 Gurgaon, Haryana - 122001, India

Ken Research is a Global aggregator and publisher of Market intelligence, equity and economy reports. Ken Research provides business intelligence and operational advisory in 300+ verticals underscoring disruptive technologies, emerging business models with precedent analysis and success case studies. Serving over 70% of fortune 500 companies globally, some of top consulting companies and Market leaders seek Ken Research’s intelligence to identify new revenue streams, customer/ vendor paradigm and pain points and due diligence on competition.

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