RIYADH: Saudi Arabia-based bookstore chain Jarir Marketing Co. plans to expand the number of its stores by at least 70 percent in the next five years to take advantage of the Gulf region's rapid population growth.
The Kingdom's largest listed retailer plans to spend SR 120-SR 150 million ($32-$40 million) a year, or about 20 percent of retained earnings, on the expansion, according to Chairman Muhammad Al-Agil.
The company has grown from a single store on a Riyadh street in 1979 into a chain with 32 stores in the Kingdom. It sells books and office supplies, and has also become a major electronics retailer, the Saudi daily (Arab News) reported.
For the next decade or so, population growth may support Jarir's growth almost regardless of fluctuations in oil prices.
The GCC's population is projected to climb by 30 percent over a decade to more than 50 million in 2020, according to the Economist Intelligence Unit.
"The growth in consumer numbers means growth for a long time. There are a lot of young people," said al-Agil, who co-founded the chain with his family.
He predicted the company would have more than 55 stores by 2017, which would roughly double its sales volume.
The firm expects to open about 80 percent of its new stores in Saudi Arabia and says it already owns most of real estate needed for this expansion an important advantage in a country where rising land prices have often crimped development plans.
The company's stock price has risen 10 percent so far this year, outperforming a 4 percent gain for Saudi Arabia's main stock market index.
In 2009, Al-Agil said Jarir would consider expansion in North Africa after 2012, with Egypt a primary target. But he delayed those plans in 2011, after Egypt and other countries in the region were hit by the Arab Spring uprisings. (QNA)
