UAE’s Coffee Planet aims to build on growing appetite for lattes

The UAE purveyor of coffe across the country and wider GCC plans major growth this year to take advantage of what is expected to be a rise in annual consumption.

A barista at Coffee Planet prepares coffee for customers at the Gulfood exhibition at the Dubai Trade Center. Alex Atack / The National.

Coffee Planet, the UAE’s home grown coffee brand, sold about 100,000,000 cups of coffee last year across all outlets and is targeting 30 per cent growth in 2017.

Coffee Planet saw 13 per cent growth, when including extra outlets and franchisees, and 5 per cent growth in like-for-like sales over 2015. Many UAE retailers reported slowing sales in 2016 as the weak oil price and strong US dollar affected consumer sentiment.

The brand is most visible, with its automatic and semi automatic vending machines, in all 90 Adnoc service stations but is now present in 240 outlets including Enoc service stations, carts, kiosks and Coffee Planet-branded stores.

“We started in Dubai in 2006 and are now in all seven emirates, Pakistan, Malaysia, Oman and Qatar,” said Robert Jones, the managing director of Coffee Planet. He said the company began with automatic vending machines but quickly used its coffee roastery and distribution channels to branch into servicing the hospitality and commercial industries. “We began as B2C [business to consumer] but Coffee Planet is increasingly B2B [business to business] with the hotel industry and office distribution now 70 per cent of our business. While we know there is a slowdown most people will not give up coffee, they may give up paying for expensive coffees. That is where we, as a speciality coffee roaster, saw growth as our coffee is only Dh13. The hospitality industry is still growing in the UAE and we believe we are in a strong position for much of the coffee service business.”

The brand expanded its manufacturing facility in Jebel Ali in 2015 and 2016 and now roasts 100 tonnes of coffee per month with a capacity of 180 tonnes. The fluctuations in raw coffee prices have seen the company buy all its coffee for 2017 and some of 2018, hedging against any volatility. Appetite in the UAE is mainly for milky coffees “80 per cent of our coffees sold are cappuccinos or milky lattes with our busiest machine on the Dubai–Abu Dhabi highway outside Ghantoot” said Mr Jones.

It seems few people are unwilling to stop the caffeine kick with the coffee industry set to grow at 6 per cent a year, according to Euromonitor International.

“Coffee is a necessity food with low income elasticity,” said Nikola Kosutic, a research manager at Euromonitor International. “Furthermore, historically coffee has been performing well during recessional times due to it being seen as an anti-depressant that relaxes and stimulates.”​

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