Crossing borders with Second Cup
Look and feel of coffee shops vary by region around world, but its roots remain Canadian
The sun has only just come up in Beirut, but already the honking has started. It would be easy to mistake the constant bleating as impatience — the road is choked thick with 1970s Mercedes sedans and new Land Rovers — but the horns are simply placing a coffee order.
Drivers pull up near a corner in Beirut’s Ein al-Mreisseh neighbourhood and idle in the street near a store that sells Arabic coffee for 60 cents a cup. Waiters run into traffic with plastic cups balanced aloft on silver trays, stooping to deliver the payload before the cars putter off. Along the sidewalk, dozens of men sit in multi-colored plastic chairs sipping the Arab cappuccino, a mixture of heavy espresso, powdered sweetener and hot chocolate.
This is the pure coffee culture of the Middle East, with the neighbourhood coffee shops the central meeting place for a morning chat. But beyond the busy streets in some of the once-leafy neighbourhoods around the American University or in the strings of hotels along the Corniche, the international brands dominate the sidewalks: here a Starbucks, there a Gloria Jean’s and, over there, — keeping pace — Canada’s own Second Cup.
There are three Second Cup locations in Beirut and more than 100 in the Middle East and North Africa. Second Cup International opened its 130th franchise outside of Canada, in Manchester, U.K., late in 2014. The first overseas location popped up in Dubai’s gigantic Mall of the Emirates in 2003 and the company’s international growth has continued unabated since. It has franchise locations across the Emirates and in some unusual, unstable places: Pakistan, Iraq, Syria, Yemen and Egypt. There are more Second Cup locations in Cairo (five) than in the entire United States (four).
Jim Ragas, the president of Second Cup International, explains the successful growth as part of an international desire for foreign brands and the consistent delivery of that brand’s promises.
“Throughout the Middle East and in other places, people are looking for international brands and, when they get them in their region, they’re really happy,” he explains. “But there’s a huge amount of competition. And so the focus has to be on executing great service and having a great product. I think we do both.”
Second Cup International is an entirely separate entity (“apart from sharing a name and some recipes,” jokes Ragan) from Second Cup, the company that runs the Canadian franchises.
The franchise model is different, with a heavier investment required from prospective franchisees, who must have a net worth of $3 million and $1.5 million in liquid assets. In Canada, a franchisee only needs to have $120,000 in assets and $350,000 in net worth.
Beirut’s ritziest Second Cup sits overlooking the majestic Pigeon Rocks in Raouche, along the city’s upscale see-and-be-seen neighbourhood. It’s light and airy, with a full glass wall and a huge patio with views of the Mediterranean. Most of the indoor seats are plush couches and chairs and, outside, wealthy Beirutis sip frozen drinks in the summer furnace. There’s frozen yogurt on the menu.
Issam Rahal owns the Second Cup stores in Beirut. This location is his favourite and is one of six international training cafes for new franchisees. It’s one of the crown jewels in the Second Cup International empire and Rahal is proud of this.
“This store has won awards within the company,” he beams, “and it’s where people come to train with us.”
Rahal has a history with Canada. He’s Lebanese but lived in Montreal for four years, where he was first acquainted with Second Cup.
“I’m basically Canadian,” he jokes, while tapping on the maple leaf on the cup. His family runs four hotels in Beirut, one of its best restaurants and all of the Second Cup stores, which he manages.
He’s the kind of franchisee Ragas is looking for: he has a proven track record of success in the city, and he’s dedicated to the brand. He also offers new ideas on ways to improve the brand, which Ragas explains is another key element of Second Cup International’s success.
Despite that external input and brand flexibility, Second Cup International remains distinctly Canadian. Its head offices are in Mississauga and all franchisees go there for an initial 10-day training session. The company proudly sports a maple leaf in its logo and on every cup.
“We identify with the Canadian brand and we’re proud to be a Canadian-based company,” Ragas explains.
“Internationally, we added the maple leaf to our logo for the simple reason that Canadians are still viewed very favourably across the world. To market that and use it in our branding, from a franchising perspective, it’s a positive.”