Starbucks branches planned for Cape Town and Durban

©Norman Kin Hang Chan via 123RF

Releasing the group’s results for the year to February, Taste Holding CEO Carlos Gonzaga says South African consumers have welcomed its international brands Starbucks and Domino's Pizza and, in the Starbucks case, there is now a natural rhythm of people regularly passing through the stores.

Following the South African Starbucks launch little over a year ago, management says it has evidence of its potential, both in operating metrics and as an investment. Plans are to open eight to 10 Starbucks outlets this year, including expansion to Cape Town and Durban, in formats located in a corporate office and drive-thru.

Despite only launching in February, customer response to the Starbucks rewards programme has exceeded expectations with 9% of transactions now being paid for using the rewards programme, stated Taste Holdings.

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While the medium-term potential for the food business is hugely attractive, Gonzaga says that perspective cannot rose-tint the hurdles to be overcome before reaching real profitability levels in one to two years’ time.

“Taste is now a start-up entity with 16 years’ experience. The idea of chasing that first rand of profit and eschewing the little comforts of a profitable business may not be some people’s proverbial ‘cup of tea’, but it is in our DNA – and a large part of the success of a new venture lies in the persistence required to push through to that first rand of profit,” Gonzaga concludes.