Java House plans new outlets in Nairobi and Kampala.
Customers at Nairobi Java House on Koinange Street on October 12, 2012. PHOEBE OKALL
What you need to know:
- The coffee house opens a new outlet on Mama Ngina Street and plans to open another one on Kimathi Street in June to tap into the consumption habits of the burgeoning middle class.
Java House will spend Sh430 million to open seven more outlets in Nairobi and Kampala.
The coffee house on Thursday opened a new outlet on Mama Ngina Street in Nairobi and plans to open another on Kimathi Street in June to tap into the consumption habits of the burgeoning middle class.
Chief executive Kevin Ashley said the expansion will focus more on the city centre where it will target the working class looking for a comfortable place to grab a meal while out with friends.
“It is a timely investment given the growth of the middle class which means more people having bigger disposable incomes,” Mr Ashley told the Sunday Nation.
Branches will be opened in Kampala and Kisumu in three weeks, while Westlands, Hurlingham and Donholm’s Greenspan Mall will get Java outlets in the third quarter.
“Kenyans have a demand for comfortable places where to engage with friends. As the middle class grows, competition in the industry intensifies with it, which means that we must invest to remain at the top,” Mr Ashley said.
The new outlets are expected to create 200 jobs.
American private equity firm Emerging Capital Partners bought a majority stake in Java House two years ago.
The capital injection is expected to drive local and regional expansion.
EXPANSION INITIATIVES
The company’s growth is in line with an industry trend that has seen the entry of new coffee shops into the market, forcing existing ones into expansion initiatives.
In March, US-based fast-food chain Subway announced plans to open new outlets in Nairobi, including one on Kenyatta Avenue, where Savannah Lounge, owned by listed firm Sasini Group, was housed before it closed shop last year.
The Avanti Group, which took over the BooksFirst restaurants that are housed in Nakumatt outlets, is also in an expansion mode that is expected to give it a bigger footprint in the market.
The firm plans to open a branch in Nakumatt Embakasi this month and another one at Jomo Kenyatta International Airport later in the year.
In January, Artcaffe took over seven Dormans coffee shops to increase its presence in Nairobi and Mombasa.
The construction of more malls in the country with food courts frequented by thousands of shoppers, especially on weekends, has also contributed immensely to the growth of the hospitality industry.
