beyondbrics

By Ronald Buchanan in Mexico City

The tropical highlands of Central America grow some of the world’s finest Arabica coffee – much of it imported by Starbucks, which accounts for some 20 per cent of the Guatemalan crop alone. Yet the inhabitants of the isthmus have yet to experience a cup of Starbucks coffee, much less an iced caramel macchiato or frappuccino.

But coffee drinkers won’t have to wait much longer; by the end of this year, a franchised Starbucks will open in El Salvador, the first in a chain of stores expected to spread throughout Central America.

The new franchise is held by Corporación de Franquicias Americanas (CFA), which has 138 restaurants and other outlets in the region from franchises held by Pizza Hut, KFC, Wendy’s and China Wok.

But will the Starbucks magic cast its spell in a country so steeped in coffee-growing lore? Many producing countries have very little – in some cases, almost nothing – of the café culture of the leading producer nations, such as those of southern Europe.

Café culture is mainly a middle-class phenomenon in Central America. And the region’s middle classes are thirsty for the consumer customs of their US counterparts.

But if Starbucks is really going to succeed in the lands of coffee growers, it should probably aim for Colombia – far larger than El Salvador’s tiny market. The company has said it has plans to open stores there, but hasn’t yet. On the other hand, it would face strong competition from Colombia’s home-grown Juan Valdez chain, which is owned by the country’s coffee growers federation.

So, pass the lattes.

Related reading:
Outlook for Colombian coffee farmers perks up, FT
Pacific Coffee in China: Size isn’t all that matters, beyondbrics