Saudi Arabia Logistics and Warehousing Market Outlook to 2029

The report titled “Saudi Arabia Logistics and Warehousing Market Outlook to 2029 – By Market Structure, By Mode of Transport, By Type of Warehousing, By End-User Industries, and By Region” provides a comprehensive analysis of the logistics and warehousing market in Saudi Arabia. The report covers an overview and genesis of the industry, overall market size in terms of revenue, market segmentation; trends and developments, regulatory landscape, customer-level profiling, issues and challenges, and comparative landscape including competition scenario, cross comparison, opportunities and bottlenecks, and company profiling of major players in the Saudi logistics and warehousing market. The report concludes with future market projections based on revenue by segment, mode of transport, end-use industries, region-wise demand, cause and effect relationships, and success case studies highlighting major opportunities and risks.

Saudi Arabia Logistics and Warehousing Market Overview and Size

The Saudi Arabia logistics and warehousing market was valued at SAR 75 Billion in 2023, driven by government-led infrastructure investments, the growth of e-commerce, and increasing demand from the FMCG, retail, and industrial sectors. The market is characterized by key players such as Bahri Logistics, Almajdouie Logistics, Agility Logistics, Aramex, and Naqel Express. These companies are known for their strong transportation networks, integrated warehousing services, and strategic geographic presence across the Kingdom.

In 2023, Bahri Logistics expanded its inland transport and storage operations to support Vision 2030 goals and enhance supply chain efficiencies for the manufacturing and retail sectors. Riyadh and Jeddah remain major logistics hubs owing to their concentration of industrial activity and proximity to major seaports and airports.

Market Size for Saudi Arabia Logistics and Warehousing Industry on the Basis of Revenue in USD Billion, 2018-2024

What Factors are Leading to the Growth of the Saudi Arabia Logistics and Warehousing Market:

• Vision 2030 and Infrastructure Investment: The Saudi government’s National Industrial Development and Logistics Program (NIDLP) aims to transform the Kingdom into a global logistics hub. Between 2018 and 2023, more than SAR 100 Billion was allocated to transport infrastructure development including dry ports, special economic zones, and bonded logistics zones.

• E-Commerce Expansion: The rapid growth in e-commerce, with platforms such as Noon, Amazon.sa, and JollyChic, has significantly increased demand for last-mile delivery and urban warehousing. In 2023, e-commerce logistics accounted for 18% of total logistics revenues, up from 9% in 2019.

• Diversification of Economy: As part of economic diversification efforts, the non-oil sectors, especially retail, pharmaceuticals, and industrial manufacturing, have witnessed robust growth. This has created demand for sector-specific warehousing solutions such as cold chain and hazardous goods storage.

Which Industry Challenges Have Impacted the Growth for Saudi Arabia Logistics and Warehousing Market

• Fragmented Market and Lack of Standardization: The logistics and warehousing sector in Saudi Arabia remains highly fragmented, with a large number of small to mid-sized players operating with limited technological integration. According to industry estimates, over 60% of logistics providers in the Kingdom lack automated systems for inventory or fleet management. This results in inefficiencies, inconsistent service standards, and difficulties in meeting client expectations, particularly for multinational clients requiring integrated solutions.

• Workforce Skill Gaps and Saudization Pressure: A shortage of skilled logistics professionals and the implementation of Saudization policies have posed operational challenges. In 2023, logistics companies reported a 25% turnover rate due to skill gaps and rising costs of hiring trained local staff. Many players are struggling to balance compliance with Saudization mandates while maintaining service efficiency.

• Customs and Border Clearance Delays: Despite improvements, customs clearance and intermodal connectivity remain bottlenecks. In a 2023 industry report, 38% of logistics stakeholders cited border delays, document processing issues, and lack of coordination between customs departments as major hurdles. These issues lead to longer turnaround times and increased costs for freight operators.

What are the Regulations and Initiatives which have Governed the Market

• Vision 2030 and NIDLP Reforms: As part of Vision 2030, the National Industrial Development and Logistics Program (NIDLP) aims to transform Saudi Arabia into a leading logistics hub by improving connectivity, enhancing regulatory transparency, and expanding logistics zones. Between 2020 and 2023, over SAR 30 Billion was allocated toward upgrading multimodal infrastructure including dry ports and bonded logistics zones.

• Zakat, Tax, and Customs Authority (ZATCA) Digitalization: The implementation of digital customs platforms by ZATCA has streamlined import/export documentation. In 2023, over 85% of customs declarations were filed electronically, reducing average clearance time at major ports by 18%. These changes have encouraged global logistics firms to increase operations within the Kingdom.

• Incentives in Special Economic Zones (SEZs): The government has launched SEZs such as the King Salman International Complex for Maritime Industries and Services and logistics zones in NEOM and Jazan. These zones offer tax holidays, reduced land lease costs, and simplified licensing procedures. In 2023, SEZs accounted for approximately 12% of the total warehousing stock in Saudi Arabia, a figure expected to rise rapidly by 2026.

Saudi Arabia Logistics and Warehousing Market Segmentation

• By Market Structure: The market is segmented into organized and unorganized players. Organized players, including multinational logistics providers and large domestic firms, dominate in high-value segments such as contract logistics, international freight forwarding, and integrated warehousing solutions. These companies benefit from advanced IT systems, regulatory compliance, and partnerships with large corporates. Unorganized players, often local transporters and small warehouse operators, serve regional clients with low-cost, flexible services. However, they often lack standard operating procedures and modern infrastructure, impacting scalability and service consistency.

• By Mode of Transport: Road transport is the most widely used mode, accounting for a major share due to Saudi Arabia’s vast highway network and heavy reliance on domestic truck movement for goods. Sea freight plays a key role in international trade, with ports like Jeddah, Dammam, and King Abdullah Port handling a substantial portion of imports and exports. Air freight, while limited in volume, is crucial for high-value and time-sensitive goods such as electronics, medical supplies, and express shipments.

• By Type of Warehousing: General warehousing remains the most dominant type, serving industries such as retail, FMCG, and construction. However, specialized warehousing—including temperature-controlled, bonded, and hazardous goods storage—is gaining traction due to rising demand from pharmaceutical, food processing, and chemical industries. In 2023, cold chain warehousing witnessed a 16% year-on-year growth due to increasing consumption of perishables and biologics.

Competitive Landscape in Saudi Arabia Logistics and Warehousing Market

The Saudi logistics and warehousing market is moderately consolidated, with a mix of established domestic firms and international players operating across freight forwarding, contract logistics, last-mile delivery, and specialized warehousing. The growing demand for integrated logistics services and digital transformation has attracted new entrants and intensified competition across segments.

Some of the recent competitor trends and key information about competitors include:

• Bahri Logistics: One of the largest logistics firms in the Kingdom, Bahri reported a 12% increase in revenue from inland logistics services in 2023. Its strategic focus includes fleet expansion, digital freight solutions, and alignment with Vision 2030 logistics goals.

• Almajdouie Logistics: With a robust portfolio in industrial logistics, Almajdouie continues to be a key player in project cargo and supply chain solutions. In 2023, the company expanded its warehousing capacity in Riyadh by 20% to cater to rising demand from the manufacturing sector.

• Agility Logistics: A major regional player, Agility has invested in scalable warehousing solutions and customs clearance automation in Saudi Arabia. Its 2023 partnership with a leading e-commerce firm boosted last-mile delivery volumes by 18% year-over-year.

• Aramex: Focused on express logistics and e-commerce deliveries, Aramex saw strong growth in urban fulfillment centers in Jeddah and Riyadh. It launched AI-enabled route optimization tools in 2023, leading to a 14% improvement in delivery efficiency.

• Naqel Express: Known for serving SMEs and retail sectors, Naqel expanded its cold chain capabilities in 2023 by launching temperature-controlled hubs in Dammam and Medina. Its cross-border services with GCC countries also gained traction.

• SAL Saudi Logistics Services: A subsidiary of Saudia Group, SAL specializes in air cargo and ground handling services. In 2023, it handled over 600,000 tons of cargo, supported by investments in automated terminals at key airports.

• Ajex Logistics: A newer entrant, Ajex focuses on time-critical shipments, particularly for healthcare and government clients. In 2023, it expanded into Tier-2 cities with a 3PL model aimed at pharmaceutical supply chains.

What Lies Ahead for Saudi Arabia Logistics and Warehousing Market?

The Saudi Arabia logistics and warehousing market is projected to witness sustained growth through 2029, driven by continued diversification of the economy, infrastructure expansion under Vision 2030, and rising demand from e-commerce, manufacturing, and retail sectors. The sector is expected to register a healthy CAGR during the forecast period.

• Expansion of E-Commerce and Last-Mile Logistics: Rapid growth in digital retail platforms such as Noon and Amazon.sa will continue to fuel demand for last-mile delivery services and micro-fulfillment centers. By 2029, last-mile logistics is expected to account for over 25% of total logistics demand, driven by urbanization and rising customer expectations for faster delivery.

• Rise of Smart Warehousing: Warehousing facilities in Saudi Arabia are transitioning towards automation, robotics, and AI-driven inventory management. Major logistics parks in Riyadh and Jeddah are expected to adopt smart solutions for real-time tracking, predictive maintenance, and warehouse optimization, improving overall operational efficiency and reducing costs.

• Strategic Role of Logistics Hubs and SEZs: The expansion of Special Economic Zones (SEZs), dry ports, and bonded logistics zones will solidify Saudi Arabia’s position as a key transshipment and regional logistics hub. Projects like NEOM’s Oxagon and the King Salman Park are expected to attract global logistics players seeking regional bases for integrated supply chain operations.

• Cold Chain and Pharma Logistics Growth: With increasing pharmaceutical imports and rising food consumption, the cold chain logistics segment is projected to grow at over 10% CAGR through 2029. Demand will be driven by stricter SFDA regulations, expansion of healthcare infrastructure, and consumer preference for high-quality perishables.

Future Outlook and Projections for Saudi Arabia Logistics and Warehousing Market on the Basis of Revenues in USD Billion, 2024-2029

Saudi Arabia Logistics and Warehousing Market Segmentation

• By Market Structure:
  o Organized Logistics Providers
  o Unorganized Logistics Operators
  o Freight Forwarders
  o 3PL & 4PL Service Providers
  o Contract Logistics Companies
  o Domestic Transporters
  o International Logistics Firms
• By Mode of Transport:
  o Road Freight
  o Sea Freight
  o Air Freight
  o Rail Freight
  o Multimodal Logistics
• By Type of Warehousing:
  o General Warehousing
  o Cold Chain Warehousing
  o Bonded Warehousing
  o E-commerce Fulfillment Centers
  o Industrial Warehouses
  o Distribution Hubs
  o Temperature-Controlled Storage
• By End-User Industry:
  o FMCG
  o Retail & E-commerce
  o Healthcare & Pharmaceuticals
  o Industrial Manufacturing
  o Construction & Heavy Equipment
  o Automotive
  o Agriculture & Food
• By Region:
  o Riyadh
  o Jeddah
  o Dammam
  o Makkah
  o Eastern Province
  o Tabuk
  o NEOM Zone

Players Mentioned in the Report:

Freight Forwarding Companies

• Almajdouie Logistics
• Bahri Logistics
• Binzagr Company
• Arabco Logistics
• BAFCO International Shipping & Logistics
• Sharaf Shipping Agency
• Abdul Latif Jameel Logistics
• Al Jabri Logistics
• Abdul Latif Jameel IPR
• AYA Shipping Company
• Freights Solutions
• Crown Logistics
• Bayan Logistics
• Bridge Logistics
• Pan Gulf Logistics
• Transfreight Saudi Arabia
• United Gulf Logistics
• Sinotrans KSA

Warehousing Companies

• Advanced Storage Logistics
• Crown Logistics
• Momentum Logistics
• Bayan Logistics
• ALDREES Petroleum & Transport Services
• SAL (Saudi Logistics Zone)

E‑Commerce Logistics Companies

• SMSA Express Transportation
• NAQEL Express
• J&T Express
• AJEX Logistics Services
• Linkers Express
• Starlinks Logistics
• Esnad Express
• Mrsool

Express Logistics Companies

• DHL Express
• FedEx Express
• UPS
• Aramex
• Saudi Post
• SMSA Express Transportation
• NAQEL Express
• Esnad Express
• J&T Express

Key Target Audience:

• Logistics and Freight Forwarding Companies
• Warehousing and Cold Chain Providers
• E-commerce and Retail Chains
• Industrial and Manufacturing Firms
• Regulatory Bodies (e.g., ZATCA, SFDA, Ministry of Transport)
• Real Estate Developers (Industrial Parks & Logistics Zones)
• Investment and Private Equity Firms
• Infrastructure and Supply Chain Consultants

Time Period:

• Historical Period: 2018–2023
• Base Year: 2024
• Forecast Period: 2024–2029