Public Study B2C Kingdom of Saudi Arabia (KSA) 2023
Cross-border e-commerce in KSA
Cross-border e-commerce represents a whopping 60% of e-commerce sales in the KSA. Consulting firms Kearney and Mukatafa partnered with Potloc to uncover insights into the local e-commerce market and how KSA could create a more equitable playing field.
Partnership summary
Consulting firms Kearney and Mukatafa wanted insight on how current KSA policies impacted ecommerce for local players. To complete this study, the team decided to collaborate with the survey expert at Potloc.
Using Potloc’s proprietary sampling and analysis technology and in-house market research experts, Kearney was able to interview 500 respondents in the KSA region.
The study findings explored cross-border, local, and hybrid e-commerce value chains and gave insights on how to make the playing field more equal for all involved.
Illan Bitton
Global Strategy Director
Ouiam Herrar
Account Manager Consulting & Private Equity
Key figures from the survey
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60%
of e-commerce sales in KSA come from cross-border e-commerce.
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72%
of customers prefer cross-border retailers because of lower prices.
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20%
price differential between local and cross-border players due increased cost of doing business for local businesses.
Key implications for KSA local e-commerce
Cross-border ecommerce may present employment challenges for KSA
Current regulations favoring cross-border players could mean reduced revenue for the KSA government
With current regulations, about 10% of cross-border sales result in revenue loss for KSA. If cross-border players represented 10-12% of the e-commerce market instead of 60%, the KSA exchequer could generate an additional 900-950 million SAR. This revenue loss could reach 1.3 billion SAR in 2026.
Current cross-border model could hurt the long-term potential of the local industry development
With the current model favoring cross-border players, negligible investments occur in KSA, which can hurt the long-term potential of the local industry.
About Kearney and Mukatafa
Kearney is a leading management consulting firm that helps their clients achieve immediate impact and growing advantage on their most mission-critical issues.
Mukatafa is the only organization in the KSA working toward the collaboration and integration of public and private sectors to promote progress in the country’s economic landscape.
