2 July 2019 | Kuwait

Costa Coffee seeks further expansion in Middle East markets

Expanded franchise partnership with Alghanim Industries aims to capitalise on growing demand for premium coffee and western hospitality concepts across the Middle East

Left to right: Kutayba Y. Alghanim, Executive Chairman, Alghanim Industries, Dominic Paul, CEO, Costa Coffee, and Omar K. Alghanim, Group CEO, Alghanim Industries


 

Costa Coffee and Alghanim Industries have announced the expansion of their Middle East franchise partnership. Kuwaiti-based multinational Alganim will for the first time gain right rights to develop the Costa brand outside of Kuwait across Saudi Arabia, Oman and Qatar, a move which will make it the largest Costa franchisee by territory.

Costa and Alghanim formed their Kuwaiti franchise partnership in 2013 and now operate more than 75 stores across the Arab nation. UK-based Costa first entered the Middle East coffee shop market in 1999 with a store in Dubai. Today the chain operates more than 400 sites across the region, making it the third-largest branded chain in Middle East behind Dunkin’ and market leader, Starbucks.

“Today marks another exciting new chapter for Costa Coffee in the Middle East”, said Dominic Paul, CEO of Costa Coffee. “Our vision is to inspire the world to love great coffee and in Alghanim Industries we have an innovative and exciting partner who will help us unlock the next phase of growth in the Middle East, bringing further investment and job creation across a number of countries where demand for Costa Coffee is growing.”

Allegra research identifies significant growth potential for both branded chains and specialty independent cafés across the Middle East, where appetite for western hospitality brands remains strong among consumers. While Turkey and the UAE are the most developed coffee shop markets in the region, Saudi Arabia and Kuwait are key growth markets. Ongoing economic liberalisation contributed to Saudi Arabia enjoying the highest rate of outlet growth in the region in 2018 at 9.6%, while, outlet growth in Kuwait, which has a long-established coffee shop culture, was the second highest at 8.9%.
 

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