Coffee houses turn to local brew to beat high prices in foreign coffee

Caffeine hunters in Colombo that were a staple in the popular coffee houses prepandemic are dwindling, so much so that these outlets cannot sustain themselves.

Coffee houses are what initially came into being in the late 1990s and started with The Commons in Colombo. So many franchises have entered Colombo during the last two decades and intensifying in the last decade.

Like in most industries, the pandemic managed to beat the market down, many international coffees house managers told the Business Times. “The franchise costs are high. It was impossible to pay the franchise fees during the pandemic. Also, when entering a franchise, it is mandated to open at least five coffee houses within five years etc. Sustaining these during the pandemic was a big question with high overhead costs,” an industry official said.

A second owner confirmed this, noting that coffees like Lavazza are really expensive and most coffee shops now target food items for their customers.

Certain coffee houses the Business Times spoke to said that their coffee sales have reduced. “Now we are more into food items. It was also difficult to source foreign coffee,” one coffee house owner said.

Ijaz Ahmed, Owner The Beans Coffee Factory sourcing coffee for most coffee houses told the Business Times that the sales have dropped from 20 kg of coffee to 5 kg. He said the competition has gone excessively up and the sales have depleted.

He added that certain places did not purchase coffee beans as they were down in sales. The Beans Coffee Factory, which supplies to hotels and cafes were affected during the pandemic, he added. However, according to him, this season has been particularly good with the return of the tourists. “We can see new coffee houses and some old ones re-emerging due to the return of the tourists.”

Most outlets have turned to local blends. “We are brewing coffee with local blends, and we are now doing big sales,” a coffee house owner in Colombo said.

Entrepreneur Harpo Gunaratne, who started The Commons Coffee House 18 years ago, said, that there is exceptionally good local coffee. “I have met coffee connoisseurs who say that we have a good blend. The Commons Coffee House was the first home grown coffee shop in the country. Now we also serve so much more than only coffee. I have witnessed the coffee culture in the country becoming remarkably high and discerning from 18 years ago.” He added that with local blends, the coffee market has also seen a high in the recent past.