Coffee Planet: Raising the aroma of strong brew

Dubai: Between those opting for Dh2 cups at street-side shops and who prefer a Dh18 a cup from global chains, there is a vast — and as yet under-served — universe of coffee lovers waiting to be served. It is this very market segment that Richard Jones, founder of the Coffee Planet, is going after.

"We set out with the view that you could deliver a far better and fresher coffee without charging a premium for it," said Jones. "The brand was born here and not imported; and it was our goal to create something that was relevant to this market and be exportable."

By the looks of it, Jones is well on his way to getting things done his way. A slew of brand new Coffee Planet Cafes are to open between now and the end of the year in the local market.

Franchising opportunities are also being brewed at the same time, with one for Oman signed up and probably in Malaysia and Singapore. Other Far East markets could be on the board as well as India.

But the hard yards were done prior to the launch of the cafes. "We started out with the idea of being a coffee company but one taking a different point of view from the global brands," Jones said.

Better control

"Most people's perceptions of being a coffee company is build a store and get people to come in. Besides not having the finances to do it and there being no point in taking on the global majors at their game, we got to do our own thing."

"Our decision was to go around the global names — we will try to provide a great coffee experience where they were not present and that meant going to where the consumers were.

"That led us to the convenience stores in fuel stations; it was not a brand new idea, but it was new here. We persuaded people to think of picking up a gourmet coffee on the go. That was the basic platform of the business."

That, indeed, has kept the pot boiling for Coffee Planet. From a single site location, the brand's exposure at fuel stations has now gone past 140 sites. That in itself created volumes of 10,000 cups a day.

But for Jones it meant the time had come to aim for a wider canvas and be what he called a "total coffee solutions company".

It was also at the time we thought we need to be in more control of our budgets," Jones added. "We were buying the coffee, but we wanted better control of our costs and on the quality side.

"A small roastery located in Dubai Investments Park was acquired in 2008 for us to become a more rounded company. At the same time, roasting was an important part in building credibility for our brand."

Coffee Planet currently sources the beans — in its case graded Arabica — from multiple sources, the principal ones being Ethiopia, Rwanda and Kenya and more recently from Uganda and Burundi. Central America too is a sourcing point, from farms in Honduras and Brazil.

"We thus got a better grip of the supply chain and on the quality," Jones said. "Quality in the coffee business can mean a number of things — it could be the quality of the bean, it could be about how you blend it and how it's roasted.

"I wanted to be in control of all processes from the coffee bean to cup — right from sourcing the bean, roasting it and then delivering it to the consumer. Today, we have that."

It has meant investing in a new roastery in Jebel Ali, which went operational in January, after the one in DIP reached full capacity. The new facility would also open up Coffee Planet's prospects on going after coffee roasting contracts on the international stage.

With all the key ingredients in place, the time was opportune to push for a retail presence through branded cafes.

"We were already in every single emirate [through third-party locations] and that made us the most widely distributed coffee brand in the market," said Jones.

Winning customers

"About a year ago, we started developing the idea of coffee retail stores because a lot of people were asking where they could go for a wider experience. We needed to create something that reflected our ambition as a true coffee company.

"And we could not be like someone else. Every coffee shop chain is the same, but with a slightly different colour of brand.

"We are trying to say there is an alternative space at Coffee Planet Cafe. The intention was to appeal to a younger demographic."

"Lots of people know our coffee, and to a degree you can live or die by the quality of what is in the cup. We can do all the marketing in the world, but if the quality is not right up there, you are going to lose customers."

The store formats were varied based on the consumer footprint a particular location can reach out to. Having started now rather than a year ago, Jones said the brand is able to better leverage the lower rents that locations are available for.

"We had to be very careful as to the locations and the truth is half of the coffee stores in this country do not make money," Jones said.

"I do not have the vast funds to take chances and then fail. Everything had to be right the first instance itself.'

By getting into its own cafes, Coffee Planet is taking on the big names in the business head on. Jones said the value proposition his brand offers will make it competitive.

"We look at around a 15 per cent price differential with the international brands," he said. "One of the good things from the recession for companies like us is it forces people to re-evaluate how they are spending their monies."

Global coffee bean prices were running at 34-year highs brought on supply issues as well as intense speculative activity. So far, Coffee Plant has held back from passing on the higher prices to consumers.

"No one knows long this spell will continue; we are trying to offset the impact by getting more direct supplies and expand our sourcing arrangements," Jones said.

"This ensures certainty of supplies and at assured prices. We currently run on a month-and-a-half stocks, and thinking of whether we should holding more."

Tips for success

1. Work on having as much control of the entire process, the coffee bean to cup strategy.

2. Be your own thing. Trying to imitate what has worked well for others will not do for us.

3. Keep an eye on the expenses at all costs.