UAE Coffee Company Diversifies

Tim Elliott (0:00)

It's the Morning Drive, this is Mira Business FM. F&B growth in the United Arab Emirates is no longer about opening more outlets.

Established brands are increasingly looking at adjacent categories. So, new products, new revenue streams to keep growing without losing what made them successful in the first place. The question is, how do brands expand beyond their core business while they stay relevant to their customers? Our next guest, Bill, one of the UAE's best known specialty coffee brands, maybe the best known from a single roastery, nearly two decades on, coffee is still the core, but it's no longer the whole company. Matt Toogood is the co-owner and CEO of RAW Coffee Company. Join us with me in the studio. Good to meet you, Matt.

Matt Toogood (0:45)

Lovely to be here.

Tim Elliott (0:46)

It's good to have you here. You're here nice and early this morning. We've been chatting for a while, but I want to get to, I suppose, the scale of what's happening, right? How would you describe the market right now, the coffee market right now, compared to when you started RAW? Because from where I sit, it must be as light and shade, isn't it?

Matt Toogood (1:06)

I think we're going full circle again. And actually, I was talking to someone the other day. I think that once we get through this latest challenge that we're facing in town at the moment, The conflicts. The conflicts, we will be in a situation probably similar to 2010, 2011, where we're in a rebuild phase. And that's the exciting part of this type of the part of the world.

Tim Elliott (1:29)

Because you've been through some difficult times, haven't you? You launched just before the big crash of 2008, 2009 into 2010 Then you went through COVID. Now you're going through another particularly difficult time, more from a supply chain perspective, I guess.

That's a tumultuous 20 years.

Matt Toogood (1:51)

Yeah. And look, if you focus on the most important thing in our business, which is the customer, and you talk to the customer about what they want, that is, I think, how we survive this every single time. We just actually go back to our customer and say, what do we need to give you? What do we need to do? And that is, we have a roastery cafe in Alcoz, which is fantastic, but that's our test kitchen. Our big customer base is our wholesale customer, so we're now talking to them about what do they need. And the first thing they say is, of course, we need you to reduce your prices. Well, that's not practical in this world at the moment, especially with the freight costs and things. But the next thing that we're looking at, and like driving in this morning, I came in early because I was thinking there was going to be traffic.

The customers are saying, we need you to come to us. We don't want to drive anymore.

The cities become too busy. We don't want to travel across town. So, immediately think, oh, okay, we need to open more stores. But I'm not sure if that's the way that we should be going.

Tim Elliott (2:51)

Joe, I'm not sure either. One of the things about your Alcoo's place is aside from the new bakery, and I have to be honest with you, full disclosure, I go there quite a lot. I've got a meeting in there this lunchtime. But one of the real benefits of it is you've got loads of parking there.

Matt Toogood (3:10)

And the funny thing is the reason we selected that location is purely on the car park.

Tim Elliott (3:14)

I bet. Yeah.

It just strikes me, and I feel as though I've just taken away from the product that you offer in your cafe, and I'm not trying to do that. But that side is so important.

Matt Toogood (3:26)

Look, we were across the road, literally across the road before we were in the location that we're in now, which we've been in for 11 years. But across the road, people wouldn't in Dubai, they wouldn't go to that car park and then walk across the road. They expected to drive to the door. So, you know, we...

Tim Elliott (3:44)

Yeah, well, we like our convenience here, don't we?

Matt Toogood (3:46)

Yeah, yeah, yeah.

Tim Elliott (3:48)

Look, you've posted really strong growth over the past few years. What has been driving that growth? Let's put the cutoff of February the 28th for the purposes of this.

Is it that emphasis on customers, i.e. more customers, or is your customer base spending differently? Where's the growth come from?