Need for trained Saudis in sales and marketing
There is a strong need to train Saudi youngsters in the sales and marketing field, as this particular sector is mostly manned by foreign workers, according to a Saudi market analyst.
Citing statistics from the Asharqia Chamber, Mohammed Al-Homeidy, a certified financial consultant, said: “Around one million people are working in the sales and marketing sector in the Kingdom which is a sizable percentage of the local population.
“These people are working in various supermarkets, malls, retail and wholesale outlets, and also in marketing and advertising firms,” according to Al-Homeidy, who said it is a huge market in terms of products and it needs marketing specialists.
The Saudi market represents both a challenge and an opportunity for foreign businesses. In itself, the Kingdom, with a population of more than 20 million, is not an overly large market. However, it is located at the heart of a far larger regional market that includes the six Gulf Cooperation Council (GCC) states, the wider Arab world, and the Indo-Pakistan Subcontinent, totaling more than 1.6 billion people.
The Saudi market is also characterized by consumers with high disposable income. The large percentage of the population aged under 20 will likely increase the demand for a wide range of consumer goods and products in the coming years.
There are three primary marketing regions in the Kingdom — the Western Region, with the city of Jeddah as the main commercial center; the Central Region with the capital Riyadh; and the Eastern Province, where the oil and gas industry is concentrated.
Many companies import goods for their own use or for direct sales to end-users, making the location and number of retail outlets an important factor. US exporters might find it beneficial to appoint different agents or distributors for different regions.
Multiple agencies or distributors might also be assigned to handle diverse product lines or services. Although there is no requirement for exclusive distributorship, the policy of the Ministry of Commerce is that all such arrangements be exclusive with respect to either geographic region or product line.
Many Saudi companies are active in numerous product lines. A Saudi agent will typically expect the foreign supplier to assume many of the market development costs, such as the hiring of a dedicated sales staff. Foreign suppliers often assign a salesperson to the Saudi distributor to provide training, marketing and technical support. Without such an arrangement, firms should travel to Saudi Arabia regularly to support their Saudi distributor.
According to Munir Al-Said, the dean of the Faculty of Advertising in Jeddah, the size of the Saudi advertising market is about $4.4 billion per annum. He said the estimates of spending on digital advertising in the Kingdom in 2012 were about SR288 million.