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Starbucks preps for full-on Swedish invasion

Starbucks preps for full-on Swedish invasion

Published: 27 Sep 2012 16:12 GMT+02:00
Updated: 27 Sep 2012 16:12 GMT+02:00

In advance of its planned conquest of the region's lucrative coffee shop market, Starbucks has signed a deal with Norway's Umeo Restaurant Group (URG).

The group, run by Norwegian businessman Jens Ulltveit-Moe, secured the rights to operate the global coffee shop giant in Scandinavia following talks with Starbucks founder Howard Schultz in June, according to Norwegian business daily Dagens Næringsliv.

"We are talking about something in the region of several hundred million (kroner). If we are going to build a brand the right way, it will take time. If we do it right, it will give a good return," Ulltveit-Moe told the paper.

Starbucks has confirmed the agreement in a statement, expressing satisfaction that it had found "a strong partner in Umeo Restaurant Group for our expansion in Scandinavia".

Michelle Gass, head of Starbucks operations in Europe, also stressed the significance of the deal

"This is a milestone deal," she told the Wall Street Journal.

The financial crisis in the eurozone has put the brakes on Starbucks' long-intended expansion into Scandinavia, a region with a high-standard of living and an established taste for coffee.

"Scandinavia has long been on high on our list. You are among those who drink most coffee in the world and have high purchasing power," Gass told Dagens Næringsliv.

While Gass refused to say exactly how many Starbucks shops were planned for Sweden and Norway, she told the Wall Street Journal the company is looking to open a "significant" number of stores.

In addition, Starbucks hopes to rely on social media and other innovative PR techniques to build brand awareness.

The Seattle-based brand currently has only a toe-hold in Sweden, with shops at Stockholm's Arlanda airport, as well as the central train stations in Gothenburg and Malmö.

And while the US-based giant's presence remains dwarfed by local favourites Wayne's Coffee and Espresso House, Ulltveit-Moe is bullish on Starbucks' chances, telling the Wall Street Journal that Swedes and Norwegians have "an appreciation for American products".

URG, which already runs about 250 licensed restaurants throughout Scandinavia, including Burger King and TGI Fridays, will initially expand the brand in Norway and Sweden and according to the agreement will own all the proposed coffee shops themselves. Further financial details of the agreement with Starbucks are yet to be released.

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Your comments about this article

17:14 September 27, 2012 by Achilles7
It would be rather sad if Stockholm's streets become littered with Starbucks coffee shops. I've never understood Starbucks: fantastically overpriced, not particularly good quality coffee, hot chocolates which are lukewarm at best, and yet everybody seems to want to go there.

Going to Starbucks, buying a coffee, getting your laptop out and 'working': nothing is more pretentious.
17:29 September 27, 2012 by StockholmSam
I am not sure why Americans love Starbucks so much. I am American and I love it myself. I know that Starbucks was in my favorite bookstore and whenever I went to browse books, I always looked forward to getting a frappachino or coffee to sip while browsing, so it could be that association. I know others who have said similar things.

I have also wondered if perhaps Americans felt that the Starbucks experience was somehow European, if you see my point. You know, the whole fancy Italian/French coffee concept of lattes and au laits made with the big espresso machines and such. It seemed to be a concept that was rather distinct for Americans who had grown up with low-quality coffee from Maxwell House, McDonald's and the local greasy spoon. And the pastries were uniformly good compared to other chains such as Dunkin' Donuts or 7-eleven that offered baked goods.

I think $tarbucks will succeed in Sweden because the coffee is not bad although I am not convinced it is any better than Wayne's/George/Espresso House. But their specialty drinks are better. Nobody makes a better frappachino than Starbucks. And their baked goods will be a nice alternative to the usual kanelbulle and chocolate ball in every café already in Stockholm.
17:37 September 27, 2012 by star10
I look forward to Starbucks. I like their coffee very much.
18:01 September 27, 2012 by sparc
@Achilles7: Not everybody working at a cafe care about being seen. Sometimes it's just about the change of scenery, the non-stop coffee availability and the free wi-fi. If you haven't already noticed, Stockholm is packed with such places already and a big crowd enjoying them, so Starbucks will fit right in!

Looking forward to Starbucks as one more option.
18:46 September 27, 2012 by johan rebel
Boy, am I ever glad I don't drink coffee!
21:55 September 27, 2012 by krattan
While i appreciate Starbucks when traveling in China or other places where you sometimes long for a bit of westernisation, I wouldn't visit this McDonalds for Coffee in Sweden. Someone else remarked that Americans are so entrepreneurial they can even make Starbucks a success. That's telling.

As for the existing market I expect Starbucks to compete with the other boring chains, which are aplenty in Norway so I understand why they start there. I can also see them make some of the McDonalds crowd go for a coffee instead. But I don't see them compete with the more genuinely Swedish places. Maybe they will buy someone out for the location.
23:20 September 27, 2012 by Swedish Meatbulls
I actually prefer Costa Coffee when in the UK!1
23:57 September 27, 2012 by grymagnusson
is this a news article or a company press release? - extremely hard to tell the difference.
00:10 September 28, 2012 by dizzymoe33
As an American I just want to say how sorry I am that you are about to get more Starbucks coffee shops in Sweden. If you like burnt coffee then they are the best place to go but if you like good coffee go else where.
00:12 September 28, 2012 by Grokh
yay now we can all get obese like americans -_-
00:28 September 28, 2012 by feathernoodle
This is kind of depressing. While it's nice to see a familiar place when traveling out of your own country, I don't see the big fuss about Starbucks - their coffee tastes/smells burnt to me. The hot chocolate is very good, though. And so are the ice drinks. Why does everyone want to Americanize everything when we're supposed to be so hated by everyone? What's wrong with the Swedish coffee shops, I've always really enjoyed visiting them!

@Groskh - well, you already kind of are. Whenever I travel to Sweden, I am the smallest and thinnest person of all of the group of Swedish friends I visit and their children are much heavier than mine. And I'm American.

I
03:49 September 28, 2012 by jburke
Being American I can say from experience " Do not let our business chain stores take over your culture. Always keep your authentic culture as one of

your countries main assets.

All food products have a certain amount of residue as allowed by our FDA standards. People in the states were pretty upset when we found insects were

part of our coffee grind that we have been paying a premiumin for from Starbucks.

Of course you will have different owners and all may go well.
04:07 September 28, 2012 by Eric1
It's all hip and crap but when I want good coffee I go the McDonalds.
04:44 September 28, 2012 by Carbarrister
Now Swedes can go to Starbucks for Colombian coffee and debate the racist French Tintin comic books, the fate of Australian Julian Asange after prayers at the mosque. I think that it is all very multicultural. What is not to like about it?
06:04 September 28, 2012 by johnny1939
I hate to see another American restaurant in Sweden. We have enough w/ Subway, Burger King, TGIF et al. I am afraid that our beloved konditori will bite the dust if this trend continues. Besides we are also getting fat like the Yanks but I do not feel it is the fault of eating places of various kinds but of inactivity and laziness.
07:48 September 28, 2012 by Cephalectomy
Americans and swedes are newer countries without so much culture and heritage, their taste is bad and starbucks fills the city centers and train stations, so it's logical
08:34 September 28, 2012 by umeåstar
I don't think Starbucks will actually last here. I mean maybe the first year will be good because its trending to have a Starbucks cup in hand.. but Swedes are pretty cheap and I doubt they are willing to pay 9 dollars for a cup of coffee. I hope it doesn't end up like Seattle..I was so sick of Starbucks.. stores right next to each other every block ..was a joke and way overrated !
09:01 September 28, 2012 by robban70226
Great!! I miss the muffins :-)), Specially the brand..
09:38 September 28, 2012 by martin8558
Yeah for you Starbucks haters when living in America I would buy Starbucks everyday and not just a regular cup of coffee then when I came to Sweden I had had a cup of Waynes coffee which taste like crap and then Espresso House which taste like smudge . My wife and I went to Paris ( euro) and actually we paid less for starbuchs then I normally pay for coffee in Sweden
09:52 September 28, 2012 by smilingjack
Sweden already has the USA flag hanging up everywhere. Including hemkop.

Your children wear nothing but american labels. Swedish food is best described as bland and overpriced for the pretentious so starbucks will be a perfect match. I havent had a proper coffee in sweden yet. No wonder australia wins the best barista awards year in year out.
14:18 September 28, 2012 by cogito
Starbucks has better coffee than the yuck served in the Swedish chains--Wayne's, George, Expresso House. SB's is even better than French cafe au lait, which is why SBs are so successful in Paris. In Europe you have to go to Italy to get better coffee than SB's.

In the U.S., Starbucks is inferior to e.g. Peet's in California or any old cafe in New York's Little Italy.
09:26 September 29, 2012 by newyorkerinstockholm
Härligt! Now we can see every independent coffee house in Stockholm close its doors, one after one. Thank you american big business.
15:12 September 29, 2012 by Bender B Rodriquez
It is a bold move since the Swedish coffee house market is already saturated with chains such as Espresso House, Condeco, Coffee House by George, Wayne's Coffee, etc...
20:32 October 6, 2012 by Bangkokmoon
OBS: USA coffee is world famous and considered to be the champagne of ALL Arabica-

As an American who has lived in SE for over a decade and hates hearing BS everywhere concerning the crappy coffee all around SE.

Kona (Arabica Typica) coffee is the only truly fair-trade coffee on earth and as USA is not a developing/3rd world country it is not legally allowed to use the fair-trade logo. As a picker in Hawaii gets at least 1USD/pound of cherry and fair-trade pickers have to pick 10 or more pounds for the same US dollar:( Fair trade...too who??

As far as American coffee goes- USA = 5-6g /125ml where EU is 6-7g/125ml

As I have watched people for years and even today at many places with brew coffee in SE that are making it USA grams to a pot:( Every pot that a vendor can get 1-4 more cups to sell gives them an extra million sek/year.

Fact: 60 cafe spaces up for sale in Stockholm today. I see the number getting over 100 by xmas as coffee is only 2nd to oil traded daily and only 2nd to water consumed (coke is #3;) and as Starbucks has reached over 600 new shops of their 1500shops goal by 2015...EU & USA are in for a supply and demand issue.

As coffee in SE is overall low/poor quality and top 10 gourmet is not very available I look forward to Starbuck's. They specialize in high end Arabica beans and SE still has a majority of Arabica it is not Central American or African and usually from Brazil & Columbia mixed with horrible Robusta from Vietnam and other starving farmers countries:( Robusta is the insatnt coffee bean, is twice the caffeine, and as smooth as battery acid!

So, the next time you want to say USA coffee is like our beer and close to water... try a cold Sam Adam's and if you can even find some Kona coffee to taste what coffee should taste like...you can even leave it out for weeks and re-heat and it will still be amazing as it's PH is 0.05 the lowest as Jamaican Blue Mountain. Actually Kopi Luwak from Java/Sumatra that goes through the Luwak's (a palm civ= cat) stomach is the same PH as Kona & JMB but when it craps out the cherries it is the only acid-free bean on earth and the most expensive at 3000:-/kg. AA+ organic Kona is #6 after JMB for kg price at 2000:-/kg. Hard to see the starving farmers in the world where fair-trade comes from. Jamaicans, Indonesians, Ethiopians, Kenyans, and many others children do not eat as well or much at all. Hawaiian farmers are hurting too but eat great food, have good schools, and great medical plans.

Soon the world's crops will fail the world...coffee is only one of the things many take for granted.

A tip- quit drinking coffee before China and India take it away from you as well as Brazil who from 2015 have sworn to only sell 40% of their coffee to the rest of the world. As Brazilians now drink 60% of the worlds largest supplier (40%).

American coffee is the best and anyone who knows anything about coffee knows it is true:)

The truth is ....coming.
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