Saturday, January 30, 2016
COFFEE BEANS & BEINGS / WILL COFIX BE THE NEXT BIG COFFEE CONCEPT IN U.S?
Saw a quote in an article recently and forgive me I did not note where I read it but it said Starbucks can charge what it wants for its products because consumers are willing to pay.
Most U.S. coffee houses—large or small, indy or chain--mimic Starbucks pricing because why mess with a good thing?
But America being home to one of the healthiest entrepreneurial spirits on the planet may see a sea change in coffee house prices if the Cofix concept comes to America and actually catches on.
What’s Cofix? Linguistically it’s a portmanteau: coffee + fixed prices.
Cofix is a relatively new chain of urban centric coffee houses operating in Israel that offer a fixed price menu for its coffee drinks and limited food items, like pastries and sandwiches. The price is Five Shekels fixed. That ranges—depending on world currency fluctuations—between $1.25 to $1.50 US.
Cofix, founded in 2013 by Avner Katz, is the first coffee operation in Israel to go on the Tel Aviv Stock Exchange [under AGRI].
So far, with 70 stores opened in Israel, Cofix, in the past six months alone, has opened six of its cafes in the Tel Aviv neighborhood of Bnei Brak.
Locals faced with Cofix’s success with the public have cut prices, too, especially on to-go items in order to meet the challenge. A price war over coffee has broken out with local shops and other chains like Aroma Espresso joining the fray. One local Tel Aviv outlet, Shloimale has slashed prices for a coffee/pastry combo to $1.25 and cutting costs for iced coffees and sandwiches to 75 cents US.
Because most of the coffee houses are to-go operations (sitting with your computer for hours in an Israeli coffee house hasn’t caught on as fast as cheap pricing), some Orthodox rabbis are taking notice. The rabbis want a ban on to-go eating and drinking. So far, no one is listening.
But other countries are taking notice of the Cofix concept. Cofix’s Katz says plans are on to open a Cofix in London and Moscow this year. Can Manhattan’s West Side be next?
Also, Cofix has opened several separate units Cofix Bar (booze) and SuperCofix (groceries) with more on the way.
So what’s it cost for a franchise? Cofix says NIS 350,000 in Israeli currency.
You do the math. And, when a Cofix or a concept like it opens in your ‘hood remember you read it here first.