Originally created 12/14/03

New coffee shop idea brews in Colombia



BOGOTA, Colombia - Call it cappuccino with a conscience.

In a bold attempt at saving small-scale coffee growers who have been hit by a collapse in coffee prices on worldwide markets, the Colombian Coffee Federation is selling its coffee and other goods at its own shops bearing the name and image of Juan Valdez, its signature character.

Last week, the group inaugurated its flagship coffee shop, and plans to expand into the United States and beyond.

Though prices for a latte or espresso top $2 at most of the world's trendy java retailers, coffee growers see only a few pennies of the profits, as much of it goes to middlemen or vendors.

By eliminating some of the intermediaries, the federation hopes to ensure a larger part of the income for its members.

The first Juan Valdez coffee shops abroad are scheduled to open in New York and Panama by mid-2004, offering Colombian coffee in various forms, coffee beans, cakes and Juan Valdez accessories such as T-shirts and bags. Ten are planned for the first phase.

Colombian President Alvaro Uribe helped open the sleek, spacious flagship shop in Bogota's financial district Wednesday by serving the first cups of coffee from a silver tray.

It is the ninth store to open in Colombia in the past year bearing the name of Juan Valdez, the smiling, mustachioed coffee farmer sporting a straw hat and brown poncho who has appeared worldwide in many Colombian coffee ads.

Juan Valdez shops in Colombia have quickly gained popularity since the first one opened at Bogota's international airport in December 2002, with $3.7 million dollars in coffee sales, the federation said.

Colombian coffee farmers each own a stake in the shops, whose profits are also being used to build schools, roads and hospitals in Colombia's coffee-growing region.

"With this program, we are creating one of the most efficient mechanisms to transfer value from quality coffee straight to the growers," the coffee federation said in a statement. The federation wants to ensure that Juan Valdez shops will generate returns of between four and five cents per cup to the farmers.

The shops will likely face stiff competition abroad from the likes of Starbucks and other major coffee competitors, and the global coffee crisis shows no sign of easing. But Juan Valdez could prove popular with customers aware of the plight of coffee growers.

Starbucks spokeswoman Audrey Lincoff brushed off fears of competition.

"We have said always that we believe there's room for many different coffee houses," she said.



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