Tag: café expansion

DrinKit Opens Its 10th Branch in Dubai

Posted on by Qahwa World

Dubai – Qahwa World

DrinKit continues to stand out as one of the most inspiring success stories in the coffee sector, advancing its journey as Dubai’s first digital coffee shop concept. The company has announced the opening of its 10th branch in Emaar Creek Harbour, bringing its global network to 182 locations and positioning it among the fastest growing modern coffee chains.

Katerina Borodich, CEO of DrinKit in the UAE and the Middle East, stated that this opening ranks among the brand’s strongest launches to date. The branch began operations without any prior announcement, yet recorded 86 transactions on its first day, an early and positive indicator of strong performance from the outset.

This branch holds particular significance due to its location within a fully integrated residential community in Dubai Creek Harbour. It is also the largest DrinKit location in the UAE in terms of space. The choice reflects a strategic shift toward expansion in residential neighborhoods that rely on daily coffee consumption rather than focusing only on commercial or tourist areas.

Initial indicators point to strong performance in terms of average order value, reinforcing expectations for future growth at this location, which benefits from rising population density and a fast paced urban lifestyle.

This expansion also highlights the acceleration of DrinKit’s strategy in the Middle East, as the company continues its growth phase with plans to open additional branches across Dubai in the near future.

According to internal company data, Drinkit now operates 10 stores in Dubai, including four under the franchise model, reflecting its transition toward a scalable and replicable operating system.

This growth signals a broader shift in the Gulf coffee market, where brands are increasingly targeting residential communities to meet rising daily demand for coffee as part of modern lifestyles.

With 10 branches in Dubai and 182 worldwide, Drinkit continues to strengthen its presence in the UAE market as part of a wider expansion strategy.

Drinkit Expands in Dubai as Network Revenue Jumps 2.5 Times

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DUBAI – QAHWA WORLD

Drinkit, the global café chain operating under a digital-first model and founded in 2016 as part of Dodo Brands, is accelerating its expansion in Dubai following strong year-on-year growth across its network.

According to Katerina Borodich, Chief Executive Officer of Drinkit UAE, the brand is set to double its local network this year. Seven franchise partners were signed last year, with new outlets now launching. Among the most anticipated upcoming locations are Dubai Hills and Creek Harbour. Franchise interest is also increasing, reflecting growing investor confidence in the concept.

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Strong Year-on-Year Growth

In January, network revenue increased 2.5 times compared to the same month last year, while the number of operating locations doubled year-on-year.

Mature stores continue to post solid gains. Marina Gate recorded 60 percent growth, maintaining similar momentum for the third consecutive year. Bay Avenue rose 58 percent compared to January 2025, while EMAAR Square reported 32 percent growth.

Performance varies by micro-location dynamics. Marina Gate and Bay Avenue benefit from additional footfall generated by surrounding residential and retail traffic, while EMAAR Square operates within a business district environment with more structured demand patterns.

You can also read: Drinkit CEO Announces Sub-40 Month Payback Period for Dubai Coffee Shops

Operational Performance

The EMAAR Square location has on occasion reached daily revenue of 10,000 dirhams, with a peak of 374 transactions in a single day. Despite its compact layout, the team continues to optimize operations to handle high customer volumes efficiently.

Unit Economics and Payback Strategy

Drinkit’s first Marina outlet reached monthly revenue of 72,000 US dollars, delivering a 26 percent store-level earnings margin after royalties. A franchise unit launched in October has already become the third highest-performing outlet in the Dubai network, generating 48,800 US dollars in monthly revenue.

As of November, the average retail payback period stood at 40 months, excluding the Mirdif location. Since then, operational refinements have reduced unit costs by 2 percent. Delivery currently represents 13 percent of total network revenue, with further growth potential identified. The target payback period is 30 months.

Preparing for Seasonal Shifts

With Ramadan approaching, typically a challenging period for retail activity, the focus remains on maintaining profitability while scaling operations sustainably.

Drinkit’s recent performance underscores the continued dynamism of Dubai’s specialty coffee market, as international café concepts pursue disciplined expansion strategies supported by franchise partnerships and operational efficiency.

Caffè Nero Acquires Compass Coffee Assets in Bankruptcy Auction

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DUBAI – QAHWA WORLD

U.K.-based coffee company Caffè Nero has secured the winning bid to acquire the majority of assets belonging to Washington, D.C.-based Compass Coffee, which filed for Chapter 11 bankruptcy protection last month.

The final bid reached $4.75 million following a competitive, three-day auction involving five prospective buyers. Caffè Nero had initially set the baseline offer at $2.9 million through a “stalking-horse” bid. The transaction remains subject to approval by the bankruptcy court.

Operations to Continue Under Compass Name

For now, the 17 Compass cafés operating across the D.C. area are expected to remain open under their current brand. Whether the Compass name will be retained long term has not yet been determined.

Compass co-founder and CEO Michael Haft stated in an interview with The Washington Post that representatives from Nero will begin meeting with Compass staff as part of the transition process. While Nero has indicated interest in keeping the existing leadership team, formal employment offers have not yet been finalised.

A court hearing is scheduled for February 26, the earliest date on which Nero could formally assume control of the company.

Background on Both Companies

Founded in 1997 by Gerry Ford, Caffè Nero has grown into an international brand with more than 1,000 locations across 11 countries. In the United States, however, its presence remains concentrated primarily in the Boston area, with no current locations in Washington, D.C.

Compass Coffee was established in 2014 by former Marine Corps officers Michael Haft and Harrison Suarez. The company expanded rapidly in its early years, focusing heavily on high-traffic downtown locations. It also invested substantially in a large roasting and production facility in Ivy City, aiming to scale its operations.

Financial Struggles and Bankruptcy

Despite its early growth, Compass struggled to achieve sustained profitability. The pandemic forced temporary closures of several downtown cafés and prompted the company to diversify revenue streams, including selling packaged coffee through grocery stores and direct-to-consumer channels, as well as producing hand sanitiser during the height of demand.

In recent years, additional pressures compounded the company’s financial strain. These included rising coffee costs, wage increases, reduced downtown foot traffic, a shrinking federal workforce, legal disputes with landlords and suppliers, and internal conflict between the founders. Suarez departed the company in 2021, and litigation between the co-founders followed.

By early January, Compass filed for Chapter 11 protection.

The $4.75 million sale will not cover all outstanding obligations. Total debts exceed $12 million, with secured creditors expected to recover approximately $2 million. Unsecured creditors remain owed several million dollars, and investors—including the founders—are not expected to recoup their contributions.

Looking Ahead

In a message to employees, Haft expressed optimism about the transition, suggesting that new ownership could provide stability in a market environment that has shifted significantly since 2020. He noted that downtown business patterns and consumer habits have changed, requiring a different operational approach than in the company’s early years.

If approved, the acquisition will mark the end of Compass Coffee’s 12-year period as an independent, founder-led company and signal Caffè Nero’s entry into the Washington, D.C., market.

Coffee Market in Southern Russia: 2025 Overview

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Dubai – Qahwa World

In 2025, the coffee market in Southern Russia experienced steady price growth alongside the expansion of café networks. Data from Check Index and Kontur.Fokus reveal key trends in Rostov Oblast and Krasnodar Krai.

  • Rising Coffee Prices and Consumer Demand

By December 2025, the average price of a cup of coffee in Rostov Oblast reached 209 rubles (+17% YoY).

In Krasnodar Krai, the average price was 223 rubles (+15% YoY).

Despite price increases, consumer demand remained stable, driven by milk-based drinks and combo purchases.

Top Coffee Choices: Over 80% of sales come from cappuccino and latte.
Combo Orders: Many consumers pair coffee with pastries, sandwiches, or desserts.
Average Check: Rostov-on-Don ranked in the top 10 Russian cities over one million residents by café spending, with the average check at 494 rubles in autumn 2025.

  • Café Infrastructure Growth

The rise in prices did not stop café expansion:

Rostov Oblast: 513 cafés (+11.5%)

Krasnodar Krai: 792 cafés (+11.9%)

  • Strategic Opportunities

Experts highlight a shift in growth from central urban areas to residential districts, where high-quality coffee outlets are scarce. This trend opens new opportunities for entrepreneurs in Southern Russia’s coffee market.

Panera Bread Aims for $7 Billion in Sales with Turnaround Strategy

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Dubai – Qahwa World

US-based fast-casual and coffee chain Panera Bread has announced a comprehensive plan to raise its sales to $7 billion by 2028, under a new initiative called Panera RISE.

Backed by JAB Holding, the strategy focuses on updating menus, enhancing store efficiency, modernizing café interiors, and investing in staff training. The initiative is designed to address several years of slow sales growth and strengthen the chain’s market position.

According to Panera, the programme will target growth across all dayparts by emphasising fresh ingredients, flavour variety, and a robust beverage offering. The chain also plans to introduce more flexible pricing options to attract price-conscious consumers.

Expansion is another key aspect of Panera RISE, with plans to open new outlets while refurbishing existing bakery-cafés. Currently, Panera operates over 2,200 locations across the US, ranking it as the third-largest branded coffee chain in the country behind Starbucks and Dunkin’.

“Over the past year, we have reinforced our foundation to better serve our customers,” said Paul Carbone, CEO of Panera Bread. “Panera RISE builds on the strengths that have made our brand recognizable for nearly 40 years.”

Founded in 1987, Panera was a pioneer of the fast-casual concept in the US. After peaking at an estimated $6.5 billion in sales in 2023, the chain experienced a modest decline over the past two years due to increased competition from rivals such as Chipotle and Cava, as well as weaker consumer spending.

Since being taken private by JAB Holding for $7.5 billion in 2017, Panera has seen several leadership changes, including three CEOs in five years. Carbone, appointed permanent CEO in March 2025, confirmed that plans for an IPO for Panera Brands will remain on hold until operational improvements and sales growth are achieved.

Panera Brands, established by JAB in August 2021, also includes Caribou Coffee and Einstein Bros. Bagels, forming a fast-casual café group alongside Panera Bread.