Coffee houses grinding their way towards foreign markets

Home-brewed eateries Shakespeare and Co as well as Coffee Planet are pushing full steam ahead with international expansion plans, despite economic uncertainty that awaits them in some foreign markets.

From small beginnings: Coffee Planet plans to work with franchisees in its expansion abroad. Satish Kumar / The National

Cafes and coffee houses in the UAE are steaming ahead with plans for international expansions, despite economic uncertainty in some foreign markets.

Shakespeare and Co and Coffee Planet had humble beginnings in the Emirates, but both are planning to open in foreign markets as diverse as Lebanon and Lahore and even in Lexington in the US state of Kentucky.

"Even in tough times people still go out and eat," said Gaetan Herve, the general manager for Shakespeare and Co.

In an effort to limit financial risk during their brand expansions, Shakespeare and Coffee Planet plan to work with franchisees abroad.

"We're a relatively small business and don't have the funds to set up and operate in these other countries," said Richard Jones, the managing director of Coffee Planet, which opened a franchise in Kuala Lumpur in November.

A Coffee Planet outlet is expected to open in Lahore as early as this month, while an agreement has been signed for a branch in Qatar. Discussions are under way about locations in Egypt, Japan and South Korea.

"The challenge of a small business is investing in this level of innovation to stand out from the crowd, because you'll be competing with the big boys," Mr Jones said.

The big boys include global US chains such as Starbucks and McDonald's. The burger chain has been serving premium coffee in recent years.

While Coffee Planet differentiates itself, in part, by offering dedicated iPad stations and even lending tablet computers to customers to use in-house, Shakespeare is taking a less high-tech approach as it prepares new locations in Beirut, Muscat and Doha this quarter.

Starting in March, Shakespeare hopes to take a bite out of US restaurant revenues, which totalled US$604 billion (Dh2.21 trillion) last year, according to the US National Restaurant Association. But getting the brand started in Lexington has taken a full year as the company retrofitted a pair of historic buildings in the city to accommodate the outlet.

And while 95 per cent of Shakespeare's menu there will be identical to the company's offerings at a dozen locations in the UAE, certain dishes will have to be tweaked.

"Some Mediterranean or Middle Eastern dishes may need to be reworked a little so they sound more appealing, in the long run," Mr Herve says. "That'll be the hardest part."

As unlikely as the location may seem, starting in Lexington is "much wiser than diving into Boston or New York, where there are really established players in the franchise game", said Ron Ribeiro, the chief executive of Aryan Business Consulting in Dubai.

In addition, Mr Herve said, there were "close links" between the UAE and Kentucky via horse breeding and ranching in the state.

"And a lot of Emiratis go to universities there," he added.