Liquid ‘black-gold’ continues to conquer the hearts — and tongues — of consumers in Asia
As the U.S. coffee giant continues to expand its presence in Asia, Wang Xin, who runs five independent coffee shops in the Chinese city of Wuhan, is also looking to expand overseas. He has opened a small literary coffee shop with fewer than 20 seats called Remember Cafe in the heart of Taipei, near National Taiwan University.
Why would someone go through the trouble to open a tiny coffee shop 900 kilometers from his original business? “I like Taiwan’s sophistication,” observes Wang. “You can walk into any corner coffee shop, and the quality will be equally fine. Many roast their own coffee, and each cafe stands for something.”
Eight years ago, Wang, who is now 47, began to operate small coffee shops in Wuhan. At one point he ran 16 distinctly different cafes. In 2012, Wang, who has a huge following on the Chinese microblogging website Weibo, published his book “Just Thinking about Opening a Small Coffee Shop,” which sold nearly 300,000 copies. Wang visited Taipei for the first time two years ago and immediately fell in love with the local coffee culture. Over the two following years, he traveled to Taiwan 38 times.
“Chinese youth also yearn for the ‘little happiness.’ It’s not everybody who wants to become Xiaomi or Alibaba,” Wang points out. In his CenCi Coffee Dream School in Wuhan, which has been certified as a training laboratory by the Specialty Coffee Association of America, Wang has already trained nearly 1,000 participants. He encourages his students to return to their second-tier and thirdtier home cities to open small coffee shops there. Demand for the courses is so strong that people need to register half a year in advance to secure a slot. “China’s coffee era is only just beginning,” Wang says.
S. Korea Pop Culture Cracks
Open US Market
At the headquarters of Seoulbased coffeehouse chain Caffebene, 47- year- old company founder Sun-Kwon Kim meets our reporter just four hours after flying in from London. “Recently we have been doing market research in Paris and Rome, since we hope to enter the European market,” Kim remarks.
Just as Korean pop music, TV soaps and movies have swept the Asian market in recent years, branded South Korean coffee shop chains are gearing up for global expansion. Caffebene, specialty coffee chain Hollys Coffee and Europeanstyle dessert cafe A Twosome Place all rely on the glitz and glitter of South Korean music and movie stars and their celebrity endorsements to launch their brands abroad, not just in Asia but also in the United States and the Middle East.
Kim decided to tackle overseas markets in 2012 after expanding his company to some 800 outlets in just four years, making it the largest coffeehouse chain in terms of number of stores. Instead of going to other Asian countries, where South Korean pop culture already has a huge following, for his first overseas expansion, Kim picked New York, opening a flagship store in Times Square.
“Our enemies are our best teachers,” Kim says. He still remembers that, back when Caffebene entered the U.S. market, Time Magazine asked why Asian countries would want to sell coffee in America.
“Since when did coffee become an American thing? Starbucks was only born because they are very good at marketing, and their commerce is developed,” Kim says. His chain’s success in Korea has bolstered Kim’s confidence. It is precisely because today’s world is “too complex” that people are encouraged to fearlessly take on new challenges, he says.
To date, Caffebene has invested US$8.5 million in 32 outlets in the U.S. market, but the U.S. operations are not yet profitable. “However, at least the Americans can already drink our South Korean coffee,” notes Kim, undeterred by the current lack of commercial success. He is still determined to take his coffeehouse brand to other countries.
South Korea is not a coffeegrowing nation. As a result, South Korean entrepreneurs need to rely on chain stores to take their brands international. In contrast, traditional coffee grower Vietnam has been making great efforts to join the ranks of coffee-exporting nations.
Over the past two decades, Vietnam’s share of the global coffee export market has grown from a tiny 0.1 percent to 20 percent. Meanwhile, the Southeast Asian country has overtaken traditional coffee-exporting giant Columbia and now ranks second worldwide, just behind Brazil. In years when Brazil experienced drought-related crop failures, Vietnam temporarily even outstripped Brazil to become the world’s largest coffee exporter.
The dynamic growth of Vietnamese coffee production comes almost entirely from small farms with less than five hectares of coffee plantations. Like the other ‘black gold’ that gushes out of the ground -- crude oil, coffee has become a crucial crop for Vietnam in developing the local economy and lifting its people out of poverty.
Vietnam’s coffee culture dif- fers from that in East Asia. The Vietnamese like their coffee strong and sweetened with condensed milk. Coffee drinking is an indispensable part of talking business, dating or casual chatting. With the legacy of more than 60 years of French colonial rule, Ho Chi Minh City, with its population of eight million people, boasts more than 6,000 cafes. This constitutes an even higher density than that of convenience stores in Taipei. As one would expect, per capita coffee consumption here is not less than in Taipei, with a growth rate of over 10 percent per year.
Coffee aficionados insist that the small roasted beans deserve to be credited for creating Western civilization: When Venetian traders introduced coffee to Europe in the 17th century, coffee culture soon became a focal point of urban life. At the beginning of the 20th century, intellectuals and scholars gathered in coffeehouses to discuss public issues, exchanging ideas and opinions as the aroma of coffee filled the air.
Coffee drinking conquered the planet in the 21st century, evolv- ing into a global culture even in traditional tea-consuming regions like Asia. Who would have thought that the rate of coffee consumption in Asia would become higher than the world average, or that Asia would become the leading coffeedrinking continent?
British sociologist Anthony Giddens, whose discussion of the sociological dimensions of drinking a cup of coffee has become quite famous, has said that the coffee in our cups has reached us through a series of historical, economic and social developments. Like alcohol, coffee generally remains a socially accepted stimulant. Coffee drinking, which Giddens describes as “a global phenomenon par excellence,” has created a worldwide market with huge business opportunities.
The coffee craze sweeping across Asia promises sweet deals, whether or not you add sugar to your cup of black gold. Translated from the Chinese by Susanne Ganz. Additional reading selections can be found at http:// english.cw.com.tw