The story of the largest local chains in the Middle East and Africa is largely centered on the Gulf States and South Africa, with both markets home to thriving, competitive eating out scenes. The similarities mostly end there, however. South African consumers retain a strong preference for local brands, led by local operator Famous Brands, second only to YUM! Brands with more than $450 million (U.S.) in sales. Years of international isolation produced a strong chain ecosystem in South Africa, with local brands such as grilled chicken chain Nando’s and steak chain Spur Steak Ranches still enjoying a strong local following. Nando’s, in fact, has become Africa’s first truly global fast food chain, posting more than US$1.2 billion in 2013 sales across almost 30 global markets, above all the UK, where it has become a local institution.

As in other emerging markets, effective segmentation is key in South Africa, which boasts one of the most diverse consumer bases in the world in terms of incomes, cultures, and languages. Many chains have looked to outlet segmentation as a means of serving a highly varied consumer base, with small-footprint, limited-menu formats highly popular in lower-income rural and suburban areas. Others, most notably Famous Brands, have looked to segment the market through brand acquisitions. As a result of a years-long acquisitions spree, Famous Brands now operates multiple concepts in several of the fastest-growing categories in South African foodservice, from coffee shops to pizza takeaway to hamburgers, making it possible to target a wide array of price points and consumer groups.

The competitive environment in the Gulf States and the wider Middle East is quite different by comparison. Encompassing a huge population of expatriates from around the globe, markets like United Arab Emirates, Qatar, Kuwait and Saudi Arabia have become a focus for chains from around the globe. Indeed, no other region draws as wide a variety of chain concepts, including players from nearly every major market. With social culture heavily focused on shopping and eating out, demand for novelty and quality is high, while large numbers of well-funded mall and retail operators offer ample opportunities for partnership, with a willingness to partner with any chain offering an interesting concept, large or small.

Perhaps because of this, the number of truly local players from the Middle East is relatively small. Two of the largest local chains, Aroma Espresso Bar and Café Café, are based in Israel, a testament both to Israel’s thriving local coffee culture, as well as its relative isolation in the region, with Gulf-based retail operators and major franchisees generally refusing to do business there for political and legal reasons. In Saudi Arabia, fast food chain Herfy has enjoyed brisk expansion with an aggressively local approach, while its status as part of the massive Savola Group of companies and recent IPO have provided significant capital for expansion.

Nearly everywhere else, the focus is far more on hunting down the most exciting, interesting chains from around the world, given the vast capital resources and operating expertise of local conglomerates such as Kuwait-based players Americana Group or M.H. Alshaya Co., both of which operate a large number of global food and retail brands in markets across the region. The combination of a highly diverse expatriate population (accounting for a majority of residents in many Gulf markets) and vast tourism inflows to cities like Dubai has created tremendous demand for variety, while the region’s historic status as a trading hub means familiarity and experience with a variety of imported goods. Looking ahead, the pace of borrowing from other markets and regions is expected to accelerate, while the very largest local franchisees are expected to make further investments in building and promoting their own brands, creating still more competition in an already fiercely-contested local restaurant market.