The expansion is set to increase Amazon’s storage capacity by 89% and its delivery network by 58% across the kingdom.
Amazon is seeking to capitalize on Saudi Arabia’s fast-growing entrepreneurial ecosystem and to partner with a growing number of entrepreneurs and tech startups as it vies to expand its Saudi-dedicated retail site launched in 2020.
After rebranding the former Souq.com to Amazon.sa in the kingdom, the new site was met with a welcome reception as the company announced in March 2021 that it will hire 1,500 new employees in Saudi Arabia.
Now, it is set to incorporate 11 buildings to its network, an expansion that will increase its storage capacity by 89 percent and its delivery network by 58 percent within the kingdom.
“We’re working with the local entrepreneurs and we see a lot of those in the Kingdom. I think the space has changed drastically,” said Ronaldo Mouchawar, vice president of Amazon Middle East and North Africa.
Amazon currently operates three warehouses or fulfillment centers in Riyadh and Jeddah in addition to 11 delivery stations and two sorting centers. By the end of 2021, Amazon aims to have six warehouses and 13 delivery stations, while its fulfillment network will stretch out across a total area of more than 867,000 square feet. The global conglomerate is also partnering with Saudi Post and a network of 10 service partners to complement its expansion.
“We’re seeing high double-digit growth obviously in most of our locales. Very good growth,” he continued, revealing that “we don’t report growth by region, but overall the industry is growing and Amazon being newly launched is attracting a lot of customers.”
According to Statista, the revenue of e-commerce in Saudi Arabia is on track to reach $7.051 billion by the end of 2021, and to grow annually at a rate of 5.38% to reach $8.697 billion by 2025.