Starbucks Returns to Roots with Colombia Entry

On top, company expands product line in US with juice
By Catherine Yang
Catherine Yang
Catherine Yang
August 27, 2013 Updated: August 27, 2013

Since its opening in 1971, Starbucks has been roasting and serving coffees sourced from Colombia. Next year, Starbucks will open its first café in Colombia, and expand its support of coffee farmers.

“From our humble start in Seattle’s Pike Place Market, Starbucks has always admired and respected Colombia’s distinguished coffee tradition,” said Starbucks President Howard Schultz after a meeting with Colombian President Juan Manuel Santos on Aug. 26.

Starbucks plans to open its first store in Bogota next year, and many more in Bogota and other major cities in Colombia within the next five years. These stores will be operated through a joint venture with Alesa, Starbucks’s Latin America partner for over 10 years. 

Starbucks currently has 650 stores across 12 markets in Latin America, 500 of which are operated by Alesa in Mexico, Argentina, and Chile. Alesa currently operates three other coffee brands in 48 locations in Colombia.

Grupo Nutresa will also continue to partner with Starbucks in this expansion, manufacturing products like Starbucks VIA soluble coffee. 

“I am convinced that the dynamism and evolution of this market, together with its rich coffee culture tradition, will welcome a first-class brand such as Starbucks and its premium Colombian and world coffee blends,” said Alesa CEO Fabian Gosselin about the partnership with Starbucks and Grupo Nutresa. “This will give us the opportunity to execute an aggressive and profitable development plan, which will strengthen our expansion strategy in Latin America.” 

According to Colombia’s National Department of Statistics in 2012, only 20 percent of the coffee consumed in Colombia was homegrown. Despite being the fourth-largest coffee producing country, Colombia imported more coffee than ever before in 2012. Roughly a billion sacks came from Peru and Ecuador, most of it instant coffee.

As a part of the expansion, Starbucks plans to expand cooperation with Grupo Nutresa’s subsidiary Colcafe to produce locally sourced, roasted, and packaged coffee for Colombian customers. Colcafe will build the first roaster in Latin America to roast Starbucks espresso and packaged coffee. 

“We have great pride in being the first Latin American market where Starbucks commits to serving only locally sourced and roasted Colombian coffee,” said Carlos Piedrahita, Grupo Nutresa CEO. The facility for developing Starbucks VIA Colombia will be located in Medellin, Colombia.

In an effort to further the relationship with Colombian coffee producers, Starbucks announced a public–private partnership with United States Agency for International Development (USAID) to support coffee farmers. 

The partnership will create a three-year $3 million investment to provide technical support to Colombian farmers.

“Through this collaboration, we are helping to meet critical development needs in rural areas of Colombia that will create stability and sustainability for small-scale coffee growers,” said USAID Administrator Raj Shah.

Starbucks purchases more coffee from Colombia than any other company and roasts and serves Colombian coffee in 62 countries around the world. The company has a mission to place Colombian coffee in the world spotlight and has decided to feature one single-origin Colombian coffee every year in the Starbucks Reserve Coffee Program.

More than Coffee
Within the United States, products found in Starbucks cafes will soon be sold at a leading food retailer. This fall, Whole Food Markets across the nation will stock the Evolution Fresh cold-pressed juices sold at Starbucks. 

In addition to 12 existing juices, Whole Foods Market will carry two exclusive juices, Organic Ruby Roots and Organic Sweet Burn. The suggested retail price ranges from $2.99–$6.99 per bottle.

“We’ve received enthusiastic customer support in every market where we’ve introduced Evolution Fresh juice, and have been working toward our goal of national distribution since the acquisition,” said Chris Bruzzo, Evolution Fresh senior vice president.

Starbucks had acquired the Evolution Fresh brand in 2011, with plans to sell the products in 8,000 Starbucks and grocery stores by the end of 2013.

Last but not least, three Evolution Harvest snack bars will be available in Whole Foods Markets, and soon after in Starbucks as well.

Catherine Yang
Catherine Yang