Starbucks South Africa said yesterday it had put the challenges it had experienced in the past few years behind it and was looking to expand its footprint by opening more stores. Photographer - Tracey Adams/African News Agency (ANA)
Starbucks South Africa said yesterday it had put the challenges it had experienced in the past few years behind it and was looking to expand its footprint by opening more stores. Photographer - Tracey Adams/African News Agency (ANA)

Starbucks SA is aiming to expand its local footprint by opening more stores

By Sandile Mchunu Time of article published May 4, 2021

Share this article:

DURBAN - STARBUCKS South Africa, which recently celebrated its fifth anniversary of operating in this country, said yesterday it had put the challenges it had experienced in the past few years behind it and was looking to expand its footprint by opening more stores.

Adrian Maizey, the chief executive of Rand Capital Coffee and the licensee of Starbucks SA, said the firm had increased its store franchisees in the country to 25 from 16 after acquiring the licence from Luxe Holdings, previously known as Taste Holdings, about 15 months ago.

“We see ourselves as building the brand from scratch in the country that is well aligned with any start-up business.

“We are fortunate that we have a brand that has done well in over five decades across the globe, even though we are still a young brand in the country.

“So far, we have had a mixed journey in the last five years, but the stores remain profitable,” Maizey said.

Rand Capital Coffee acquired the Starbucks SA franchise after Luxe Holdings announced a strategic shift in November 2019 by exiting its food business and sold the Starbucks SA franchise for R7 million to a company called K2019548958.

Maizey confirms that Rand Capital Coffee was the company behind acquiring the franchise, and they had been approached at the 11th hour in order to prevent Starbucks SA from being liquidated.

“We had to register the company immediately to facilitate the acquisition, and we ended paying R35m for the 16 leases, including paying for the other four outstanding leases that the previous owners were still owing the creditors,” he said.

Starbucks SA also had to navigate the Covid-19 challenges, which have had a negative impact on businesses around the world.

“The Covid-19 outbreak has made it difficult for businesses to operate and remain profitable since the pandemic was reported over a year ago, and Starbucks SA had to face the challenges head-on. It was a stressful period for any company, and we had to fight and survive in an unknown environment presented by the pandemic.

“Our supply chain was put to the test, as we had to source some of the stock abroad in places as far as Western Europe for our coffee, which was not easy, as borders were closed to deal with the impact of the virus,” Maizey said.

Looking ahead, Maizey said it was important to take the brand out of key areas such as Sandton, Rosebank and neighbouring malls to where the consumers were.

“We want to make it accessible to more consumers and make it their daily routine. We believe that the business will continue to grow, as evident in the new stores that we have opened, aided by the new technology,” he said.

Starbucks celebrated its 50th anniversary globally and has about 33 000 stores in its network.

[email protected]

BUSINESS REPORT

Share this article: