Is Starbucks ready for Africa? Taste Holdings brings the coffee retailer to Sub Sahara Africa
Taste Holdings brings Starbucks to Sub Sahara Africa
Taste Holdings – a South African management group with subsidiaries in the food and jewellery market – won the exclusive rights to roll out Starbucks outlets across Sub Sahara Africa! The first Starbucks outlet in Africa will be seen next year in Johannesburg, South Africa. Since a licensed partnership exists with Taste Holdings (Taste is the licensee) the Starbucks outlets will not be sub-franchised; instead Taste will own it directly.
South Africa is not a foreigner to amazing coffee boutiques. We have a whole host of coffee shops, brewers and award winning barristers who have mastered the science of making an amazing cuppa.
Starbucks’ coffee expertise
Starbucks is a global retailer of specialty coffee globally. It has more over 22,000 coffee shops more than 66 countries. Starbucks has a reputation of high ethical standards, roasting Arabica coffee of the highest quality, while supporting a better future for the lives of the people who cultivate it. Taste Holdings now has the exclusive rights to develop Starbucks Coffee in South Africa.
“We are proud to be bringing Starbucks to South Africa next year,” says Kris Engskov, president of Starbucks EMEA. “Working with Taste, our partner, we’re going to deliver a great Starbucks experience. The coffee market here is vibrant and growing fast – we want to be part of that growth, bringing the passion and energy of this remarkable country into the design of our first store and our first barrister team. We can’t wait to get started.” [Source]
Exclusive rights for Sub Sahara Africa: What does this entail?
Through the agreement, Taste Holdings will be able to do the following:
Operate Starbucks stores for as long as 25 years
Open Starbucks stores in other African countries
Is Starbucks ready for Africa?
To answer the question, yes, Starbucks is ready for Africa. The question is… is Africa ready for Starbucks?
Believe it or not but this is not the first time that Starbucks expanded its Africa reach. They already boast outlets in Northern Africa, specifically Casablanca and Cairo. Given that most of their beans originate from the Southern African region, Starbucks’ expansion to the region makes it all the sweeter. [Source]
9 African countries in Africa that Starbucks get its coffee beans from
Democratic Republic of Congo
Starbucks isn’t just expanding willy nilly. They have done their research on the Africa market and have included a strategy that is tailored to each country in Africa that they plan on setting up in. They have also forecast the buying power, income potential and other revenue-making points of interest, for the Sub-Sahara Africa market, up to 15 years and above.
Starbucks plans to target the continent’s middle income class.
Given that according to Bloomberg, middle-class households in sub-Saharan Africa are expected to increase from the current 15 million to 40 million by 2030, Starbucks is going full-steam ahead!
Starbucks will be implementing a strategy that includes the local Southern African businesses. They will license other stores as well as change the local menu to include popular drinks of choice in that region.
Starbucks plans to tweak its menu for southern African tastes
Starbucks will have featured locally-brewed items on their menu (i.e. Rooibos tea)
What about local coffee shops in Africa?
South Africa, and Cape Town in particular, is well-renowned for our own world class coffees. In fact, UK publication, the Telegraph, has reported that Cape Town’s coffee is among “the best coffee in the world”.
The Telegraph rated Cape Town coffee higher than some of the fanciest coffee brewers in the world, including java joints in Italy and France. Wowee!
Starbucks definitely has the reputation and financial muscle to expand rapidly and compete with local coffee shops in Africa. It now boils down to who makes the best coffees and who appeals to the African palate; will it be locals who have been catering to the local coffee connoisseur or an international giant who has become an expert in coffee globally, and has yet to break the African market?
The race is on and time will tell whether Starbucks is our cup of coffee…
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