The GCC's addiction to coffee uncovered

The GCC is on a caffeine rush posting an 85% rise in the demand for coffee in the last three years. Caterer Middle East investigates.

Coffee consumption in the GCC has more than tripled in the last decade, registering an 85% increase in the last three years alone.

Last month, Caterer Middle East received notifications of the opening of another Costa Coffee branch in Dubai Marina, and the first ones for RAK and Al Ain, proving demand is not waning. But is the demand for coffee or for franchises?

Lifestyles are changing, asserted Stefan Breg at Hotelier’s Great GM Debate last month – who commented that hotels had lost their coffee businesses to the “coffee guys” – because “coffee servers in your lounges, the hub, the heart and soul of your hotels, are not switched on.”

It appears customers want knowledgeable staff and a speedy service. Hotels are not oblivious to this. In fact some, like IHG have even gone so far as to have a franchise operate within it!

The rise of the franchise
“There’s nothing wrong with having a franchise in there – eventually they do very good sales and pay us the amount of money we need for the lease,” says an IHG representative.

Some even believe the franchises are to be thanked for the growing understanding and awareness of coffee in the region.

“The culture of ‘espresso’ is luckily growing in UAE, thanks to the millions of tourists, thanks to the growing number of expats and thanks to the various franchises quickly opening,” says Ivana Provasio, brand manager Moka General Trading.

“Convenience” is also the reason behind the success of the rapidly growing instant coffee market. But according to Ryan Godinho, national events manager, UAE coffee events, growth in both these areas is down to market infancy in this region.

“Our research shows that there is not much demand for coffee in its basic form, with little appreciation for espresso or black coffees in this region. As yet, it’s a fairly diluted market, with coffee drinks being sweetened or milk based,” he says, adding that one of the problems is that baristas will make the coffee to the standard they’ve been trained to but not consistently.

“I’d say there are about 10% to 15% of baristas out here who actually want to be baristas – the rest seem to be doing it to get along. The average pay for a barista in the UAE is around AED2000 (US $500) a month. That compared to a market with a thriving café culture like Australia where baristas earn as much as $500 a week.”

RAW Coffee’s owner/director Matt Toogood, believes the region is being forced to settle for sub-standard coffee, adding that there is a difference between a “barista” who understands coffee and a “coffee maker” of which you find many in this region.

Baristas vs Coffee Makers
“People who are making it [coffee] aren’t empowered. In some places they aren’t even allowed to taste it. How can you make a good quality coffee without constantly tasting it?” he asks.

Kim Thompson, owner/managing director of RAW adds that often even if he/she cares for the product and wants to do a good job, his/her efforts are often thwarted, particularly in hotel environments where the purchasing department makes most of the choices when it comes to equipment and product sourcing. Provasio shares this view, adding that most of the time, people don’t care about quality “they just go with the cheapest cup of coffee”.

Just another expense?
But this is changing says Toogood.

“Every hotel will tell you breakfast coffee in the morning is an expense and is treated as such, but maybe in their five-star restaurant the manager or exec chef will say it’s not good enough for what I am providing.”

Lime Tree Cafe a well-loved standalone concept in Dubai has its own customer base – whether it be corporate clientele looking for coffee on the go at its Media City outlet, or people looking for a relaxed coffee experience at its branch in Al Quoz. Either way, it believes each environment has its own customer base it targets and appeals to.

Subin Dharman, EAM food and beverages at Ritz-Carlton, Doha agrees: “They’re [hotel customers] not only looking for coffee but the whole coffee experience. The hotels still have their clientele who come in for the experience, and not just to have a coffee in a take away cup on the go.”

Ancis Romanovskis, sales manager for Coffee Planet, believes the rise of the franchised brands is forcing hotels to up their game: “They are definitely starting to improve their coffee quality as the pressure from their clients increases. With the rise of independent cafés and coffee shops, the hotels need to step up their game and remain competitive.”

There is little doubt that this will involve some heavy training to turn “coffee makers” into “baristas”.

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Pouring the perfect cup
But training issues are not limited to hotel coffee lounges says Gautam Kumbargeri Srinath, Marco Dubai’s sales manager.

“Baristas are generally not coffee drinkers, so they are unable to recognise the difference from one cup to another. Also the market is short of barista trainers and is flooded with chain cafes rather than individual coffee cafes/mom & pop cafes where they give more importance to coffee quality and preparation of the perfect cup.”

La Marquise’s Darya Yurkina, adds that high turnover of employees in this sector “affects the quality of the served coffee immensely and causes inconsistency both in the cup result and service.”

Suppliers including Coffee Planet and RAW have worked to develop a number of intensive training programmes. Melitta offers technical training sessions at its international training centre in Minden/Germany as well as placing technical trainers in UAE, Oman and Qatar to support its customers locally.

Eric Hughes, general manager, Costa Coffee, Metropolitan adds that the rigorous training campaigns are crucial. As well as staff learning “grinding, tamping, extracting, frothing, pouring and, most importantly, tasting” to become approved baristas, the company incentivises staff through in-house competitions both at a local level, then a worldwide level to gauge ability on an international scale.

“It’s pretty hard work, but it’s worth it and it’s necessary to serve our customers with the perfect cup,” says Hughes.

But Godinho says training is not the isssue. It’s the follow up: “The professional training imparted to this vocational trade should go beyond working behind the counter. It should address and follow up on staff attitude, product knowledge and attention to detail along with their customer service skills when dealing with new and returning customers.”

Dharman agrees: “Initial trainings as we have seen are done by professionals flown in from abroad by the coffee suppliers. There are enough suppliers in the market but the repetitions of these trainings are very limited.”

Maturing
In comparison to the rest of the world, Toogood believes Dubai itself is about five years behind when it comes to maturity of the coffee market. He says it is accelerating fast as consumers get to know there are other options and seek out quality.

Godinho agrees that while franchises currently dominate by “securing multiple and strategic locations” making it more challenging for independents to set up and succeed, the market is on the lookout for niche concepts.

But that challenge works both ways, believes Hughes: “The UAE audience is very sophisticated, cosmopolitan and well-travelled and as a consequence is demanding and trend-driven. This means at Costa we always need to anticipate and respond to the new and the next, and innovate both our product and service offerings while retaining the commitment to quality, flavour and service.”

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Light is the new black
La Marquise’s Yurkina believes in the independent concepts and hopes to see “more neighbourhood cafes opening next year serving growing residential areas.”

RAW’s Toogood believes there will be a shift away from black coffees and Turkish coffees as customers find they can enjoy a quality, lighter cup of coffee. However, according to Romanovskis — retro is the way forward.

“People enjoy discovering new ways of coffee making and then adopting them as their own. For example, the method of brewing coffee in a Syphon was invented in the 19th century but has now been rediscovered and is being utilised in many coffee shops around the world,” he says.

Cafés will also start to demand more from their coffee machines. Falko Plückebaum, key account manager for Melitta says the focus will be on “design, liability, easy function and best quality – reaching almost barista quality.”

Overall, this market does not look set to slow down. If anything, customers are driving it to innovate, says Thompson: “Customers are demanding a better product, not just in terms of coffee, but in terms of better milk, purified water, clean equipment and handmade by a barista who can make the coffee properly.

“We’re expecting to see more roasters come into the UAE, it would be crazy if they didn’t – but the best thing about that is it is going to be better for everybody because it is just going to lift the game,” she concludes.

How niche can you go?
Anantara Hotels, Resorts & Spas introduced Black Ivory Coffee at its four resorts in the Maldives, created from a process whereby coffee beans are digested and naturally refined by Thai elephants. The coffee retails at US$1,100 per kilo.

Win 5Kg of Coffee Planet Coffee!
Caterer is giving away 5kg of coffee of your choice courtesy of Coffee Planet. To be in with a chance to win, answer the following question: "What coffee brewing trend does Romanovskis say is making a comeback this year?" Email the answer along with your name and phone number to hannah.abdulla@itp.com with Coffee Planet Competition in the subject line. Deadline is 20 November.

Facts:
- 1.4bn Cups of coffee are poured a day
- 85% increase in GCC coffee consumption in last three years