14 Jul 2015 Starbucks coming to South Africa next year!

Starbucks is jumping into the surging coffee market in South Africa and will open shop here in mid 2016.

Today, Starbucks Coffee and Taste Holdings have announced a licensed partnership that will see Starbucks open full‐format stores bringing the entire range of its food and beverages to local consumers.”We are proud to be bringing Starbucks to South Africa next year,” said Kris Engskov, president, Starbucks Europe, the Middle East and Africa (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 barista team. We can’t wait to get started.”

The license agreement sees Taste owning the exclusive rights to develop Starbucks retail outlets in South Africa. As Taste is the licensee, it will own and operate the stores directly, according to Starbucks.

“We are very excited to be Starbucks partner in Southern Africa. As we’ve visited numerous Starbucks markets and partners around the world we’ve come to realize that we share similar core values, including a commitment to localization and uplifting both direct and indirect partners,” said Carlo Gonzaga, CEO of Taste.

“Starbucks supports the development of local suppliers and is fully committed to our Changing Lanes program wherein we have provided employment to previously unemployed people and expose them to global training initiatives and skills. Overall we’re a good partnership match.”

Job opportunities

The partnership will see direct job creation opportunities as each Starbucks store opens, in addition to opportunities at the Taste support office in Johannesburg. Taste expects that the indirect impact of skills transfer into South Africa, and the localisation opportunities in the supply chain will be material.

“Young people are the key to our success. The majority of our workforce is aged between 17 and 25 so talented youth has always been a priority and we will equip our new partners with the skills necessary to succeed in today’s economy. We look forward to using our partnership to leverage Taste’s strong track record of creating jobs and developing great people,” said Engskov.

“Starbucks sources a considerable amount of its global, high‐quality coffee from farms in sub‐Saharan Africa, in partnership with our network of farmer support and agronomy centers in Ethiopia, Rwanda and Tanzania. We are proud to be able to offer some of the best African coffees in the world to more customers in the region.

“We’re looking forward to bringing the entire Starbucks experience to South Africa for the first time. That includes 100% ethically sourced Arabica coffee, Starbucks full menu offering and of course beautiful coffee houses,” Gonzaga concluded.

An already competitive sector

Starbucks is entering an already lively coffee market, thanks to a mix of independent cafes and chains that have popped up in recent years.

The Seattle Coffee Company has about 90 stores in the country. Barry Parker, a director for the company, said he’s excited about the arrival of Starbucks, but that independent shops might be worried.

To the contrary, David Donde, owner of Truth Coffee, a Cape Town cafe, also says he welcomes the competition from Starbucks. “They’re going to benchmark South African pricing with world pricing. We’ve been selling our coffee too cheap here,” Donde said, adding that he thinks South African coffee drinkers are becoming more discerning about the quality of the brew, favouring “flavour over bitterness”.

Ultimately, coffee drinkers will be the winners, said Karabo Kgole, a media analyst who lives in Johannesburg: “Coffee lovers will benefit from having another brand to explore.”