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Warming the Heart of Siberia
Traveler’s Coffee roasts 20 tons of green coffee a month.
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Warming the Heart of Siberia
Traveler’s Coffee is now the largest of80 coffee chains operating in Russia.
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Warming the Heart of Siberia
From left, Traveler’s roast masters Daniel Panov, Alexander Shevkunov (2014 coffee roast champion), and Vitaliy Alemaskin.
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Warming the Heart of Siberia
Traveler’s operates 96 modern, spacious coffee shops in five countries including China.
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Warming the Heart of Siberia
Traveler’s operates 96 modern, spacious coffee shops in five countries including China.
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Russians are not known for their love of coffee. The first imports arrived in the 18th century and for a time it appeared the tea drinking Russian Empire would embrace the popular drink, but a hundred years later coffee consumption per
capita amounted to only 200 to 300 grams — most of which was instant.
Considering this history, in the 1990s the future of a national coffee chain seemed questionable, despite forecasts that sooner or later Russia’s 143 million people would awaken to the brew.
Warming the Heart of Siberia
Founder Christopher Tara-Browne.
“There is a parable about the two shoe merchants who came to Africa,” said Christopher Tara-Browne, who as a young coffee-loving American found his way to the heart of Siberia in 1997 only to discover there wasn’t a good cup to be found. “They looked around at the people. One sent a telegram to his company ‘coming home soon, no one wears shoes here’. The second one sent: ‘Urgently send everything in stock, there is no one wearing shoes here!’
“I belong to the second type of business,” said Tara-Browne. He decided to fill an empty segment of the coffee market and founded Traveler’s Coffee International in Novosibirsk, a city of 1.5 million with a winter low of 50-degrees below.
His first effort was a simple coffee counter in a pizza shop but soon he was sourcing and serving organic, Fair Trade, and Rainforest Alliance certified single-origin coffee. Eventually he acquired a vacant factory and opened one of Russia’s first specialty roastery operations.
Today the company operates 96 modern coffeehouses in 5 countries, roasts 20 tons of coffee a month, and produces 3 tons of frozen desserts. Russians are price conscious but willing to pay for quality. Cappuccinos and lattes are best sellers at 130 rubles ($3.20) a cup.
STiR Tea & Coffee Industrn International recently caught up with Traveler’s c.e.o. Tara-Browne to learn how his business has developed since its frosty early days.
“I grew up in a country with a strong culture of coffee,” said Tara-Browne. “Americans drink coffee at home, in a coffee shop, and on the way to work. I knew it would work for Russia.”
Americans drink an average 9.25 pounds (4.2 kilos) of coffee per person. It is largest coffee market in the world.
Industry representatives say that Tara-Browne successfully established a strong team at the ideal time to enter the market. Last year Dean Torrenga, a senior executive with Starbucks Coffee Co., joined the firm with a mandate to build 500 stores in five years. Traveler’s coffee shops now operate in China, Kazakhstan, Ukraine, and Azerbaijan.
“This is quite an interesting project,” said Ramaz Chanturia, head of the Russian Union of Manufacturers of Tea and Coffee. “At the time when it was created, it was difficult to predict the success due to its far location. For a long time it developed in one city only, but in the end, the growth of the company followed the rise of the country’s economy. This factor has determined Traveler’s success. This was the only company in the segment that began as a regional chain and has turned into an all-Russian chain.”
Russia’s coffee market has changed significantly in the past decade. There are now 80 coffee chains and coffee and pastry chains operating in Russia, according to government and industry statistics. There are 5,212 coffee shops including 673 in Moscow and 476 in St. Petersburg. Coffee chains operate 1,340 of these shops. The segment grew 22% year-on-year in 2012.
Average coffee consumption per capita has increased to 4 pounds (1.81 kg) per year. Twenty years ago nobody knew about coffee shops, now more than 60% of Russians visit such places every year.
“Traveler’s Coffee in Siberia was a real revelation for the local market, as consumers got access to a coffee with the quality they had not known before. It is not a secret that in Russia, the culture of coffee consumption always was developed poorly, but in the regions remote from the country’s centers it developed even worse. When Traveler’s came to business there were several coffee chains in Moscow and St. Petersburg, but not in Siberia,” said Andrei Volkov, a Russian coffee market analyst.
The rapid growth of chain coffee shops in Russia is closely associated with franchising and Traveler’s Coffee. The company opened its first franchised coffeehouse in 2006. During the economic crisis of 2008 Traveler’s Coffee, unlike most of other coffee companies, did not close down their business. The downturn became the impetus for growth as it seriously increased interest in its franchise, according to Volkov.
Company representatives say their secret of success is their commitment to quality coffee.
The company mission is simple: “I’ve set out to create a coffee company that is unrelenting in its desire to do what is right. I believe the word “right” helps give a bearing, a course and a focus for all involved… so that we actually achieve through our actions, at least most of the time, to do what is right,” said Tara-Browne.
“We are turned on by coffee, we are real coffee crazies. We are making it, selecting it, buying it, roasting it and selling it. The heart of our coffee business is the roasting, but the other parts are also important: coffee machines, coffee grinders, even the mood of the barista - all affect the quality of the drink, and hence the choice of customers of Traveler’s Coffee,” he said.