Rapid Egyptian delivery service, Rabbit, broadens its horizons in Saudi Arabia
Rabbit, a Cairo-based quick commerce startup, has ventured into Saudi Arabia, aiming to revolutionize the grocery shopping experience for households in the kingdom. The company, known for its emphasis on delivering groceries, food, cosmetics, and other items in just 20 minutes, has established its GCC headquarters in Riyadh and is building a local Saudi team.
Saudi Arabia's online grocery market presents an attractive opportunity for Rabbit. Currently valued at $60 billion, the market shows an online penetration rate of approximately 48%, as of January 2025. This figure, while not the highest in the world, is significant and exceeds the online grocery penetration rate in the United States, which typically ranges between 25% to 30%.
The high online penetration rate in Saudi Arabia is attributed to the country's high internet penetration (95%) and smartphone usage (97%), a young population, and a growing working-age demographic demanding convenient shopping solutions. The broader Saudi e-commerce market size reached USD 222.9 billion in 2024, with a projected CAGR of 12.8% through 2033, indicating a robust e-commerce ecosystem.
Rabbit's business model focuses on stocking top household staples while emphasizing local customer favorites, with typically over 60% of suppliers being local. This strategy aligns well with the preferences of the Saudi market, where local products hold significant appeal.
Ahmad Yousry, co-founder and CEO of Rabbit, commented on the expansion into Saudi Arabia, saying, "We are thrilled to bring our quick commerce model to Saudi Arabia, a market with a growing appetite for convenience and local favourites. We believe our 20-minute delivery promise, coupled with our focus on local products, will resonate well with Saudi households."
Rabbit's operations in Egypt have already shown promising results, with the delivery of over 40 million items to 1.4 million customers, indicating "profitable growth." The company is hopeful that its expansion into Saudi Arabia will follow a similar trajectory.
The Saudi online grocery delivery market was valued at USD 1.65 billion in 2024 and is expected to grow rapidly, reaching USD 4.98 billion by 2030 with a CAGR of 20.2%. A modest increase in online grocery penetration to 4% in Saudi Arabia would create a $2+ billion e-grocery market opportunity.
As Rabbit settles into its new market, it joins other e-commerce players in Saudi Arabia, including Noon, Jarir Bookstore, and Fetchr, all vying for a share of the rapidly growing online grocery market. The entry of Rabbit underscores the potential of the Saudi market and the increasing interest of global players in tapping into this burgeoning sector.
- Rabbit's expansion into Saudi Arabia demonstrates a strategic move to capitalize on the robust e-commerce ecosystem and the significant online grocery market valued at $60 billion.
- In line with the preferences of the Saudi market, Rabbit plans to stock top household staples and local favorites, leveraging technology to deliver products within 20 minutes, thereby aligning with the growing demand for convenience and local favorites in the kingdom's business and technology landscape.
