We took a look at the GCC’s booming retail sector and infused our study with the latest marketing strategies to give you 8 of the most profitable retail businesses worth considering now.

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Great news – consumers in the Middle East are hungry for retail. Want to start a small business to ride the latest wave of retail trends? We did extensive market research to find the most profitable retail businesses for Middle Eastern entrepreneurs. 

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At a forecasted average 3% GDP increase, the Middle East shows healthy albeit modest growth in 2024, according to newspaper The Economist. While those numbers aren’t particularly strong, the retail industry stands out from the market as a whole – growing at a forecasted 4.21% compound annual growth rate (CAGR) between 2024-2032, according to consultancy IMARC Group. 

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Source:  Economist Intelligence Unit

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Reflecting that growth, 74% of Middle East business owners expect a modest to significant increase in operating profit margins, a survey from consultancy firm Deloitte reveals. 

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Retail is one of the UAE’s most profitable industries in the next few years, reports news outlet Economy Middle East. Apart from locals and expatriates’ increased expenditure — usually toward sustainability and quality products — the influx of tourists will also continue driving retail forward.

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Some 74% of UAE business owners interviewed by the MEI, the Mastercard network’s research institute, expect retail sales to grow in 2024. This, too, indicates confidence in the market. 

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If you’re looking to start making good profits in the retail industry, what is the best type of business to get into? In short, you want to have a low-cost retail shop or brand that has an online presence and that sells a service or product that is in high demand.

Want to know what the best business opportunities in the Middle East are? Read on for the 10 most profitable retail businesses in the Middle East.

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What are the most profitable retail businesses in the Middle East?

To find a lucrative business, entrepreneurs should look at what people spend their hard-earned money on. Middle East consumers overwhelmingly expect to increase spending on groceries, fashion, consumer electronics, health and beauty, and travel in 2024, a survey from consultancy PwC shows. 

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The most profitable business ideas in retail try to catch that increased spending.

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Source: PwC 

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Next, you need a good business model that plays into the latest consumer habits. Of all retail trends in 2024 and beyond, it’s the growth that e-commerce shows over brick-and-mortar stores that entrepreneurs looking to enter the retail industry should pay attention to. 

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The MEI estimates the return rate of e-commerce in the GCC region to have increased by 13.2% between 2019 and 2023. 

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Source: Mastercard Economics Institute (MEI)

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Both consumers and business owners in the Middle East are well-prepared for an e-commerce boom and there’s room for plenty more growth, according to consulting firm Bain & Co, who label e-commerce the growth engine of retail. 

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Now that we established that retail not only is profitable but growing, driven by increasing consumer spending and an e-commerce boom, let’s identify the most lucrative business opportunities that align with consumer spending trends and have potential for online/omnichannel business models.

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Ready to start a business? Below are 10 of the best retail business ideas for entrepreneurs in the Middle East.

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1. Tapping into quick commerce: Start a grocery store

Guess which particular type of grocery business has been doing well in the GCC region. That’s right, the online grocery business is one of the most profitable retail businesses in the GCC. That’s because, with the adoption of digital technologies in the region and e-commerce booming, GCC consumers turn to their smartphones for groceries en masse.  

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So much, that the market for online grocery delivery is expected to grow a whopping 26.4% annually (CAGR) in the MEA region until 2029, according to research from analyst Morder Intelligence. 

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Source: Morder intelligence

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Online grocery shopping offers convenience, time-saving benefits, and a wide product selection to consumers. Get in on the action with a small grocery business that can serve customers online through a delivery app. 

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Key players in the online grocery business are mostly large retailers, research firm MarkWide reports. Players like InstaShop and Taw9eel.com, however, offer small businesses a way to tap into the growing quick-commerce grocery trend.

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Quick commerce grocery, or q-commerce grocery, is a segment of e-commerce that focuses on quick delivery of groceries and everyday items. Quick commerce providers offer delivery times from fifteen minutes to an hour and allow customers to shop for food and other essential items from the comfort of their homes.

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Source: MarkWide Research

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Competition in the supermarket industry is traditionally intense, with big supermarkets generating higher profit margins of 5-12%, compared to small independent grocery stores ranging from 1-4%, retail consultant Your Retail Coach estimates for the Saudi market.

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The growing popularity of quick commerce grocery shopping, however, means you can enter the market with strong digital marketing and higher profit margins. Q-commerce users typically don’t mind higher prices for the convenience of having groceries delivered to their doorstep within a short time, consultant Oliver Wyman found in a survey. 

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Starting a new business in the grocery market might seem tough at first and profit margins low, but playing into the everyday needs of consumers through smart inventory selection, a strategic location, and strong digital marketing can create a successful business. 

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So why open a grocery store in the Middle East? Because offering convenience at a higher price through q-commerce is a straightforward and profitable business model with low startup costs.

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2. Feeding the on-demand economy: Open a food truck

The rise of e-commerce and delivery apps isn’t only affecting grocery retail – the food business is riding the trend, too. Meeting consumers’ demand for convenience by opening a food truck presents another potentially lucrative business. 

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The appetite for food delivery in the Middle East and North Africa (MENA) region was already growing in 2020, news outlet Gulf Business then reported, with over half (53%) of MENA consumers purchasing food online that year. 

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Entrepreneurs need not worry this growth will come to a halt anytime soon, with Morder Intelligence estimating the food delivery market to grow globally at a 16.24% CAGR until 2029.

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Another interesting development in the Middle East’s food retail sector is the rise of fast food consumption. The Middle East fast food market size has a projected growth rate (CAGR) of 9.40% during 2024-2032, according to the IMARC Group.

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The report attributes the growth to rapid urbanization, changing dietary preferences, the appeal of international fast-food brands, the availability of healthier menu options, and increased affordability.

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What is a good business model that plays into these factors and the demand for online food delivery – but that comes without the high startup costs that are associated with opening a franchise fast food restaurant? Food trucks.

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Operating a food truck is a low-cost business venture that brings your cuisine directly to customers. These affordable mobile setups have less overhead costs than a traditional restaurant and allow you to serve all kinds of fast food, from burgers to ice cream and from tacos to pizza. 

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Food trucks allow you to meet local demand, like at events, while food delivery services can help you get consistent turnover. Operating a food truck requires a strong marketing strategy and social media. And if you’re planning on putting in the hard work of operating the food truck yourself, be prepared for long hours.

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Ultimately, whether you can turn a food truck into a successful business depends on one thing: Is your food tasty enough to create loyal customers? 

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3. Serving new dietary habits: Start a healthy snack brand

As Middle East consumers have become more focused on health and wellness, their preference shifts to healthy snacks that meet daily nutritional needs and dietary preferences.  

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Having emerged as a food consumption trend during the pandemic, healthy snacking is here to stay as a dietary habit. Snacks represented the second-fastest growing FMCG (fast-moving consumer goods) category the UAE, growing 10.1% in total value during Q1 of 2023, research firm NielsenIQ reported. 

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Duncan McCulloch, general manager for the MEA region at snacks producer Mars Wrigley, said in an interview with news outlet Arabian Business that “consumer habits in the Middle East and Africa’s core markets are changing when it comes to snacking, presenting opportunities and challenges for players in the industry.” 

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McCull further commented that “healthy snacking is the fastest growing packed-food sub-category globally, despite its small size, experiencing, on average, six times the growth of regular food items.”

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“Despite its small size, [healthy snacking is] experiencing, on average, six times the growth of regular food items.” – Duncan McCulloch, General Manager MEA region, Mars Wrigley

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Premiumization is a key trend for snack producers in the health and wellness trend, with Saudi consumers willing to pay more for products with specific health claims, like being 100% natural or organic, a report from research firm Euromonitor International shows. 

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These products retail at higher prices than mainstream snacks, potentially offering high-profit margins. This opens opportunities for entrepreneurs to produce unique, premium snack foods with an emphasis on quality ingredients and creative flavors.

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Starting a small snacks brand requires upfront capital and a strong business plan that clearly defines a target market and distribution channels. A key challenge in this business traditionally is reaching the retail market, as wholesaling to retail stores cuts into small brands’ profit margins. 

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Setting up your snack brand as an online business allows you to reach customers through e-commerce channels and capitalize on the popularity of food delivery subscriptions or bundles. 

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With strategic marketing on social media highlighting the snacks' indulgence factor, you can drive impulse purchases.

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Compared to traditional consumer-packaged goods (CPG) brands, a digitally-native snack company has lower costs by bypassing physical retail. This direct-to-consumer (D2C) model yields higher profit margins and allows you to grow production as your customer base grows, reducing startup costs.  

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4. Capitalizing on tourism: Create an off-grid travel experience

For years now, the Middle East has been growing into a top destination for global travelers. With the travel and tourism sector rebounding strongly post-pandemic, now is a great time for savvy entrepreneurs to capitalize on this lucrative industry.

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The travel sector's contribution to the Middle East GDP is set to grow at 7.7% CAGR from 2022 to 2032 and reaching nearly $540 billion, the World Travel & Tourism Council forecasts.

From the FIFA World Cup 2022 in Qatar and the development of Saudi Arabia’s NEOM, to Dubai’s malls and museums in Abu Dhabi, the Gulf’s tourist infrastructure is growing as countries are establishing themselves as top destinations. Underwriting this regional development is the approval of a unified tourist visa for the GCC, newspaper The National reported.

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This opens up profitable opportunities for small businesses catering to visitors from around the world. 

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According to Chris Ross, Chief Commercial Officer for the EMEA region at travel benefits company Collisons, many of those travellers are now “yearning to disconnect from the constant distractions of their devices and immerse themselves in the serenity of nature during their vacations.”

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In an interview with Gulf Business, Ross explained how this demographic are looking for an off-grid travel experience: “This new generation of travellers seeks an escape from reality and desires to learn survival skills, like fire-building and foraging for food, as part of their off-grid vacations, adding an adventurous dimension to their journeys.” According to Ross, “If you’re looking to truly go off the grid, the Middle East is an ideal destination.” 

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“If you’re looking to truly go off the grid, the Middle East is an ideal destination.” – Chriss Ross, Chief Commercial Offer EMEA, Collisons

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Off-grid travel experiences are a particularly interesting small business idea, as this type of travel comes with a low carbon footprint and minimalist approach. That means lower startup costs and less focus on prime locations. Instead, entrepreneurs can seek out small towns and local partnerships to create authentic experiences. 

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This trend ties into the growing demand for sustainability and the appreciation for cultural identity, which resonates with national residents, extending the target market from solely international travellers to include local tourism. 

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5. Capitalizing on tourism: Open a local artisan gift shop

Along with experiences, tourists always seek mementos from their travel destinations. How to capitalize on this ongoing opportunity?

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This creates a market for local artisan stores selling distinctive handicrafts, apparel, art, or other goods that capture the essence of Middle Eastern culture and heritage.

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A thoughtfully curated gift shop specializing in high-quality, handmade products can easily differentiate itself from generic souvenir stores. Market it as an artistic destination in itself by partnering with local artisans and craftspeople to offer unique, Instagram-worthy merchandise that global travelers will value as personal keepsakes.

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With international arrivals to the Middle East outpacing all other travel destinations, according to digital media outlet Skift, entrepreneurship revolving around tourism experiences and authentic local products are positioned for long-term growth and profitability in this booming sector.

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6. Shifting beauty standards: Start a conscious beauty store

Consumers in the Middle East spend quite a bit of money on cosmetics – beauty and personal care are an integral part of the regional culture. And with one of the highest spending on beauty globally, the Middle East is playing catch up on conscious beauty, business media outlet The Fast Company reports. 

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Simultaneously, there is a move away from promoting a universal European ideal towards celebrating the region's rich beauty traditions and evolving beauty standards, Vogue Business highlights.

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Both the shifting preferences to clean, sustainable products, and the aligning of the Arab identity into beauty create an opportunity for new, local beauty products on the market. A retail store built around Middle Eastern beauty insights can capitalize on the target market.

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With the Middle East and Africa (MEA) health and beauty market size expected to grow more than 4% annually until 2027, according to consulting company Global Data, there’s an opportunity for digitally savvy entrepreneurs to build a successful business. 

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Consultancy McKinsey, too, highlights the Middle East as an emerging hotspot for beauty retail, with underserved consumers open to local and foreign brands.

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For new business owners looking to make a buck in beauty retail, one of the biggest trends to note is how social commerce fueling the beauty sector's growth. 

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The online promotion of beauty and personal care (BPC) products is set to grow 22% annually (CAGR), contributing to 9% of total sales by 2025, a report from consultancy Reseer Consulting forecasts.

Source: Redseer Strategic Consulting

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For a new beauty retailer that stocks local and conscious products, building a strong social media presence through (micro) influencers and other digital marketing allows you to connect with this highly-engaged audience of loyal customers. 

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The report also highlights the proliferation of beauty brands with a D2C business model, which captured 15-20% of online sales in 2022 and between 30-35% in 2025. As we’ve discussed before, the direct-to-consumer model allows you to capture higher profit margins by directly selling to consumers through digital channels and thereby cutting out the middle man. 

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A final digital development to take note of is the use of augmented reality to circumvent some of the problems that are traditionally related to selling beauty products online. 

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When interviewed by news outlet ME Retail News, Mukta Purain, CEO of MissPalettable, notes how customers struggle with buying products online that match their skin tone. “Virtual AI applications within the store allow customers to virtually try products and test makeup shades before buying. VR would definitely assist users in making beauty choices that suit their skin tone,” she said.

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“Virtual AI applications within the store allow customers to virtually try products and test makeup shades before buying. – Mukta Purain, CEO, MissPalettable

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7. Targeting consumers through social commerce: Sell local jewellery

Also thriving off the increased social commerce sales is the luxury retail market, with Middle East consumers increasingly buying goods like jewellery through online channels like social media. 

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Accessories like jewelry, watches, handbags and scarves accounted 29.5% of online orders from Middle East shoppers in 2022, according to a study by partnership marketing platform Admitad. This product category nearly doubled in online order volumes compared to 2021.

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As luxury consumers increasingly discover and get influenced through social media, jewelry and accessories brands can leverage the power of social commerce. And while stocking products from big brands is expensive, meaning starting a business would require a lot of upfront capital, local artisan jewellery can be sourced much cheaper and sold with higher profit margins. 

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That’s why starting a local jewellery brand is potentially one of the most profitable retail businesses – if you build a social shopping experience that allows customers to discover and purchase your products on platforms like Instagram without ever leaving the app. Partnering with regional influencers is key to this online business strategy.

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This social-first, mobile-optimized strategy aligns with how modern buyers engage with brands. It's an effective way for emerging jewellery labels to build a local, authentic brand and win over loyal customers.

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8. Finding a fashion niche: Open a boutique online fashion shop

With rising incomes, a young population, and an appetite for the latest styles, consumers in the Middle East spend big on fashion, according to fashion news outlet Business of Fashion (BoF).

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Source: BoF

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And while opening a fashion retail shop requires big capital, entrepreneurs can choose to start a small online business that leverages digital marketing strategies. 

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As with the previous two business ideas, influencer marketing is a powerful tool for boutique fashion success. In the influence-driven Middle East market, teaming up with both small and more prominent style icons amplifies brand visibility and desirability.

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Combining this strategy with a locally-sourced, sustainable product approach can play into shifting consumer demands, while simultaneously empowering local brands and building sustainable regional partnerships.

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In Dubai, local labels have been taking over the fashion scene since the pandemic. Claudia D’Arpizio, who is the leader of Bain’s Luxury Goods vertical, told in an interview with fashion school Insituto Marangoni that “Covid-19 has led to the recovery of local business, and the travel freeze has led consumers to shop in the domestic market.” Since then, many local brands are in demand. 

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As with many of the business ideas proposed in this article, starting an online boutique fashion retail shop leverages the rise of e-commerce, online marketing strategies, and shifting consumer preferences, where Middle East shoppers are increasingly looking for local and sustainable, high-quality products.

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