Starbucks Coffee announced that it will open its first café in Colombia next year with its first store in Bogota, Colombia’s capital city.
In Colombia, Starbucks will compete with chains such as Juan Valdez Cafe, whose parent company Procafecol was created in 2002 by the Colombian Coffee Growers Federation.
Colombia is not new to world’s largest coffee-shop operator, it has been buying coffee from Colombia for almost half a century.
Starbucks CEO, Howard Schultz, said: “Our long and proud history of buying and Colombian coffee and roasting dates back to 1971, when Starbucks was founded . From our humble beginnings in Pike Place Market in Seattle, Starbucks has always admired and respected the distinguished tradition of Colombia coffee. It’s an honour for us to bring the Starbucks Experience and the best Colombian coffee to this important and growing market.”
“This is long overdue,” Schultz said. “There is tremendous enthusiasm as we talk to people and walk the streets — most of these Colombian people we talked to have consumed Starbucks coffee somewhere else.”
Starbucks stores in Colombia will be operated through a partnership between two partners with whom the company has had a long-term relationship in Latin America: Alsea and Nutresa.
As Starbucks authorized partner for over 10 years in the region, Alsea operates more than 500 Starbucks stores in Mexico, Argentina and Chile.
Alsea, based in Mexico City, earlier this year acquired parts of Starbucks Argentina and Chile that it didn’t already own. Alsea also operates Domino’s Pizza Inc. (DPZ) and Burger King Worldwide Inc. (BKW) stores in Latin America. Grupo Nutresa, based in Medellin, Colombia, is the nation’s largest publicly traded food company.
Colcafé – a subsidiary of Nutresa, the largest food company in Colombia, – worked with Starbucks in the progress of VIA instant coffee and remains an innovative and strategic partner in the production and now in retail.
Starbucks says it has aggressive plans to open stores not only in Bogota, but in other major cities in Colombia over the next five years.
Starbucks is expanding to countries with growing middle classes to help boost sales. The Seattle-based company, which has about 8,000 cafes outside the U.S., opened its first locations in India in 2012 and Vietnam this year. In Colombia, Starbucks will compete with chains such as Juan Valdez Cafe, whose parent company Procafecol SA was created in 2002 by the Colombian Coffee Growers Federation.
Starbucks also is forming a pact with the U.S. Agency for International Development to invest $3 million to secure coffee quality and supply in certain regions of Colombia. Starbucks and USAID are each investing $1.5 million during the next three years for research to help small-plot coffee farmers in Colombia. The money will go to Starbucks’s farmer support center in Manizales to pay for agronomists to analyze soil and advise growers on factors that affect yield, such as climate, pests and fertilizers.
Colombia has been Starbucks’s largest or second-largest coffee-bean supplier in its 42-year history, Schultz said during an earlier interview. In 2012, Starbucks bought about 545 million pounds of coffee from 29 countries, about 27 percent more than it bought the previous year, according to the company’s annual global responsibility report.
Recently, the company has invested in countries where it buys beans to help secure supply and consistent quality as it opens more locations. Earlier this year, Starbucks bought a farm in Costa Rica to experiment with coffee varieties and expand its grower-support program.
Starbucks opened its first farmer support center in 2004 in Costa Rica. Last year, it opened branches in Colombia and China for agronomists to help local coffee growers improve the quality and size of their harvests. The cafe operator has said it wants to sell all ethically sourced coffee by 2015.
USAID has initiated other projects to help areas in Colombia affected by internal conflict, drug trafficking and violence. Last year, the government agency began working on a program to increase access to renewable energy in the South American nation.
Starbucks, which has about 19,200 stores worldwide, gained 34 percent this year through Aug. 23. The Standard & Poor’s 500 Index advanced 17 percent.