Taste Holdings has revealed its long-term costs and strategy for global coffee brand, Starbucks, when it launches in South Africa.
According to Taste, the first Starbucks will open up in “the first half of 2016”, and following the grand opening, 12 to 15 more stores will open over the next two years.
The group expects future store growth of 20 outlets per year.
Taste’s research into the market opportunity for the brand – taking costs into account – is for 150 to 200 stores in South Africa.
Taste chief executive Carlo Gonzaga has reportedly indicated that Starbucks will keep its prices in line with what it charges internationally, according to Mail and Guardian.
However, Taste Holdings told BusinessTech that “initial indications are that product pricing will be aligned with that of current premium offerings in the South African market”.
So how much is that?
Having opened its doors in 1971, Starbucks today, boasts 22,500 retail stores in 67 countries including Egypt, Morocco, Argentina, Brazil, China, Thailand, Russia, the UK, and New Zealand.
South African consumers can probably expect to order the likes of a White Chocolate Mocha, or Caramel Macchiato, along with the usual Americano, Latte and Cappuccino.
BusinessTech looked at the prices of Starbucks coffee in some countries in which it operates, and then converted the prices directly into Rands.
It must be stressed that these are not the prices Taste intends to charge for its products next year – it’s merely a comparison for the sake of interest.
On the African continent, in Cairo, Egypt, a Starbucks Latte costs between 15.5 and 19.5 Egyptian Pounds – the same as a Cappuccino. In South African Rands, that amounts to between R26.40 and R33.20.
An Americano costs between 12-16 pounds, or R20.40 – R27.20.
The most expensive item on the menu is a Double Mocha Macchiato at 25 pounds for a venti – R42.50.
In Melbourne, Australia, the prices are as follows:
- Brewed coffee: AU$2.80-AU$3.70 – R27.20 – R36.00
- Latte/Cappuccino: AU$3.80-AU$5.40 – R37.00 – R52.50
- Americano: AU$3.20 -AU$5.00 – R31.00 – R48.50
A Caramel Macchiato costs between AU$4.90 – AU$6.70, which in local prices comes to between R47.60 – R65.00.
In London, United Kingdom, the prices are as follows:
- Espresso: £1.50 – R31.20
- Latte/Cappuccino: £2.25-£2.85 – R46.80 – R59.20
- Americano: £1.95-£2.45 – R40.65 – R51.00
The British have kindly attributed calorie counters to their coffees.
A vanilla spice latte will set you back 268 calories for a tall, while a venti size has 413 calories. For an ordinary latte, its 143 and 248, while an Americano, which is a shot of coffee with hot water added, is a mere 11-23 calories.
A Salted Caramel Mocha can contain 489 calories, and a Salted Caramel hot chocolate has 531 calories.
In the United States, its home market, the prices are as follows:
- Brewed coffee: $1.85-$2.45 – R25.00 – R33.30
- Latte: $2.95 -$4.15 – R40.00 – R56.40
A Cinnamon Dolce Latte (venti) costs $4.65, while the company is constantly adding new nameplates to its menu, depending on the holiday.
What do local competitors charge?
South Africa has several coffee chains, including Seattle Coffee Co, Vida e Caffè, and Mugg & Bean. Wimpy is also an in institution when it comes to breakfasts in SA, and has been added to the list for this purpose.
Additional smaller chains include Famous Brand’s Fego Cafe (33 stores), and Europa (20).
Seattle Coffee is a family-owned South African company, with over 85 stores countrywide, while Mugg & Bean has 169 stores in SA. Vida e Cafè claims more than 60 stores, and Wimpy has close on 500 outlets.
|Vida e Caffè||R17.00 – R20.00||R22.00 – R25.00||R18.50 – R23.50||R14.00 – R17.00|
||R17.00 – R21.00||R19.00 – R24.00||R19.00 – R24.00||R14.00 – R17.00|
|Mugg & Bean||R14.90 – R18.90||R19.90 – R25.90||R19.90 – 25.90||R14.90 – R18.90|
|Wimpy||–||R20.00||R19.00 – R24.00||R13.00 – R17.00|
||R21.00||R23.00||R21.00 – 27.00||R16.00 – R20.00|
|Europa||R19.00||R23.00||R20.00||R16.00 – R20.00|