[JayMillz]

http://news.yahoo.com/starbucks-opens-co...nance.html

Starbucks opens in Colombia, home of Juan Valdez

(Reuters) - Starbucks Corp opened its first shop in Colombia on Wednesday, 43 years after the world's biggest coffee chain first started buying beans from the country famous for its premium arabica coffee named after fictional coffee farmer Juan Valdez.

The first of 50 Starbucks stores planned for the coming five years will be in Bogota's Parque de la 93, one of the city's most exclusive neighborhoods. This store and all other Starbucks locations in Colombia will be the Seattle-based company's first to serve only locally sourced coffee.

Starbucks is the world's largest buyer of Colombia high-grade arabica coffee in the world, Starbucks Chief Executive Officer Howard Schultz told Reuters in a telephone interview.

Its new stores will compete with the roughly 200-unit Juan Valdez coffee-shop chain owned by the National Federation of Coffee Growers of Colombia. In addition, Nestle SA's Nespresso plans to begin selling home brewers this fall and open a boutique coffee shop in Colombia sometime this year.

"We think we can exist in a very complementary way," said Schultz, noting that his company's arrival often expands a market and improves business for competitors.

The Colombia business is run by a joint venture between Starbucks and two of its long-time business partners in Latin America, Alsea SAB de CV of Mexico and Grupo Nutresa SA of Colombia.

Colombia is the world's biggest producer of high-quality arabica coffee. The last few years, though, have been rocky.

Heavy rains and a replanting program that took many trees out of production drastically cut Colombia's coffee crop in 2008. That was followed by four more crop years that were well below average, in part because of an outbreak of a leaf rust disease. As a result, many U.S. dealers were forced to look elsewhere for their high-quality arabica beans, causing Colombia to lose some of its loyal customers.

Two years ago, Starbucks opened a Farmer Support Center in Manizales, Colombia. Last summer, the company announced a public-private partnership with the U.S. Agency for International Development that is investing $3 million to increase Colombian coffee yields.

More than half of the 400 million pounds of coffee purchased by Starbucks last year came from Latin America, where the chain has more than 700 stores.

Starbucks' other major coffee suppliers include Brazil, Indonesia and Africa.

[Cr33pin]

Not thrilled about your title. When I first saw it my heart dropped as I thought there may have been some truly damning event taking place that would keep me from going to Colombia.

[Deluge]

Just because Starbucks is coming to Colombia doesn't mean they will be successful. Starbucks tried to enter the Australian market some years back and completely flopped, they ended up closing almost 75% of their stores. This was because Australia has a very strong cafe culture thanks to large scale immigration from Europe post-WW2: "Memo Starbucks: next time try selling ice to Eskimos", if similar is true of Colombia then Starbucks will probably fail there too.

[cmrocks]

I hope not! The Juan Valdez coffee shops in Colombia are great; way better quality than what Starbucks serves. I particularly liked the Juan Valdez that's attached in Andino mall near the Zona T in Bogota. It had a nice patio and was a great place to sit and relax in the mornings.

[TravelerKai]

(07-23-2014 11:06 AM)Deluge Wrote:  

Just because Starbucks is coming to Colombia doesn't mean they will be successful. Starbucks tried to enter the Australian market some years back and completely flopped, they ended up closing almost 75% of their stores. This was because Australia has a very strong cafe culture thanks to large scale immigration from Europe post-WW2: "Memo Starbucks: next time try selling ice to Eskimos", if similar is true of Colombia then Starbucks will probably fail there too.

Now it makes sense. A buddy from Australia HATES Starbucks and took me to a special place to get an expresso (Americano?) with that natural creme on the top that was soo strong my heart raced for 4 hours. He is like a coffee encyclopedia too. I thought it was just him!

[scotian]

They'll probably be successful by catering to the niche market of upper class Colombians who think its cool to over pay for foreign products. I would consider buying coffee there if they introduce large cup sizes to Colombia, the largest cup you can get at Juan Valdez is smaller than the smallest you can get at a Starbucks in North America. Also, the price of coffee at Juan Valdez is a rip off considering Colombia produces it and the cheap labour costs, I think I was paying around 3000 for a cup of coffee there, I'd have to drink two just to get my fix. Often I would just buy tinto for 300 pesos in the street, not the best quality but does the trick.

[JJJames]

(07-23-2014 11:13 AM)cmrocks Wrote:  

I hope not! The Juan Valdez coffee shops in Colombia are great; way better quality than what Starbucks serves. I particularly liked the Juan Valdez that's attached in Andino mall near the Zona T in Bogota. It had a nice patio and was a great place to sit and relax in the mornings.

As someone who doesn't drink coffee, but just uses coffee shops for meetups, dates, etc, I didn't find Juan Valdez's ambiance all that amazing. I'd probably choose Starbucks over Juan Valdez.

[tomtud]

The venti in Starbucks isn't much bigger than the grande at Juan Valdez. You will pay double in Starbucks for their frappucinos as opposed to the Juan Valdez granizado.
Yes there are wealthy people, but not too many who will make Starbucks a success. They may have a few stores but to compete outside of La T in Bogota, chapinero, Norte etc it will be a challenge. In Medellin, in Tesoro maybe.

Their prices will need to be competitive, otherwise they will lose.

[William Windsor]

I remember when Starbucks opened in Buenos Aires, back in 2008, was insanely popular, there was a line of people going out the door, extending around the building.

[elcidcampeador]

Locals in Bogota aren't too happy about it, but expect people to still go to the stores. The store at the Parque 93 is massive and is right behind where they had the big screen for the world cup matches.

I honestly prefer the tintos at Juan Valdez, but for those who are into the fancier stuff might prefer Starbucks.

[simondice]

Colombians know good coffee, Starbucks will die.

[cmrocks]

(07-23-2014 02:40 PM)simondice Wrote:  

Colombians know good coffee, Starbucks will die.

I don't know about that. Any time that I've been in Colombia, the only good coffee I can ever find is at Juan Valdez or cafes in nice parts of town. Everywhere else, the coffee seems to be black sugar water.

[nomadicdude]

Unfortunately, large American corps like Starbucks can go to any market in the world. They have so much money that investing $10m or whatever to try to buy into a small/medium sized country is no big deal to them. Places like Colombia could easily just become inundated with American "culture" like this. There really is not much you can do about this unless a society is strong enough to stand up against it.

[Glider]

Change the title!

[sheesh]

(07-23-2014 02:40 PM)simondice Wrote:  

Colombians know good coffee, Starbucks will die.

It's not about quality, it's about what's cool. Young people do not really have an understanding or appreciation of quality anyway. Once it is perceived as cool to hang out at Starbucks or walk around with a Latte the concept will work.

[William Windsor]

[carter86]

young people ,and a lot of people want to associate them-self with what is considered upscale and cool , if its walking around with cup coffee with Starbucks in front of it they will do it. A time ago I did read somewhere about how upscale Colombians don't like to associate with poor Colombians that is why when you meet them the first think they ask you where you live telling them they will know if it a estrato 6 or 3 a rich or a poor neighborhood . Buying Starbucks would let people think that you upscale and cool , the same as Juan Valdez only it is not american

[Exiled Princeling]

Rumor has it that the best Colombian coffee is actually exported abroad. Perhaps Starbucks is attempting to reintroduce the good stuff?

[scotian]

(07-23-2014 06:33 PM)Exiled Princeling Wrote:  

Rumor has it that the best Colombian coffee is actually exported abroad. Perhaps Starbucks is attempting to reintroduce the good stuff?

Its not a rumor, its true, same goes for the blow and the whores.

[Sonsowey]

(07-23-2014 02:40 PM)simondice Wrote:  

Colombians know good coffee, Starbucks will die.

What kind of Colombia have you been to bro?

The Colombia I've been to, they love over-priced foreign status symbols. A Big Mac meal at McDonald's costs like 20mil, whereas un almuerzo corriente can be had for $4-5 mil (or less) consisting of real food prepared fresh.

The Colombia I've been to is full of instant coffee loaded with tons and tons of sugar.

What Americans consider "good coffee" is completely different from what is served in any part of Colombia I've ever been too. Our tastes are too bitter, too strong for Colombians. They like their coffee sweet and weak and probably with a ton of milk. Tambien les encanta chicanear con bobadas extranjeras.

Therefore, Starbucks' coffee flavored sugar-drinks will probably be a huge hit there.

[Sidney Crosby]

Reminded me of this annoying commercial they play all the time in Canada

[simondice]

(07-23-2014 07:26 PM)Sonsowey Wrote:  

(07-23-2014 02:40 PM)simondice Wrote:  

Colombians know good coffee, Starbucks will die.

What kind of Colombia have you been to bro?

The Colombia I've been to, they love over-priced foreign status symbols. A Big Mac meal at McDonald's costs like 20mil, whereas un almuerzo corriente can be had for $4-5 mil (or less) consisting of real food prepared fresh.

The Colombia I've been to is full of instant coffee loaded with tons and tons of sugar.

What Americans consider "good coffee" is completely different from what is served in any part of Colombia I've ever been too. Our tastes are too bitter, too strong for Colombians. They like their coffee sweet and weak and probably with a ton of milk. Tambien les encanta chicanear con bobadas extranjeras.

Therefore, Starbucks' coffee flavored sugar-drinks will probably be a huge hit there.

I'm from Cali, and it's true we like to brag (picarnolas de mucho) but after it wears off the novelty, they'll realize they're paying overpriced coffee since Juan Valdez is strong there, it's a pride thing.

They allowed mc Donald's after much reluctance only cause Colombians are not known for their burgers. It pains me to see that Colombia likes to adopt some the bad habits the us has things due to free commerce treaty (El Libre tratado de comercio). I do get laid like a villain when i visit after I say I live in U.S and drop some English and game but in 20 years or less Colombia will lose what makes them unique

[tomtud]

Sonsowey, the combo is more like 12 ish ....supersize, oj over coke a bit more,,,20 in medellin no.

Question is, will having a corporation like Starbucks improve the market? Will the Colombians be more patriotic and avoid this new player? Time will tell.

Colombia is not a bring your lap top or tablet to the coffee shop or park culture. Yes there are a few you see but nothing like it is elsewhere for fear of robbery. At least that's what I see in medellin. I don't think people will be walking around with a Starbucks logo cup just to show off. Don't show the papaya!!!

If I'm Starbucks, I'd be wondering what price point will I make it or break it. The forever 21 store in Santa Fe mall, when it first opened had huge lineups. Now, it seems to be running normal as far as I know. Will it be a homerun? I don't think so,,,,am quite skeptical. I've seen Tim Hortons coffee chains have success in Canada yet stumble in the USA.

I'm all for competition and better choices. I'm curious to see how it plays out.

[Sonsowey]

All Im saying is, people betting starbucks wont last in Colombia because of national pride or price, Ill take the other side of that bet any day, Apostemos una botella de antioqueño que Starbucks sigue alli

[tomtud]

LOL,,,, let's define success here,,they want to open 50 stores, I say maybe they will have a few you can count on your fingers that do well. Don't worry about betting, I'd gladly share a bottle of Guara with any Forum member in a club in Colombia any day.