After Moscow, Israeli Cut-rate Coffee Chain Plans Expansion to 10 European Countries

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A branch of the Cofix coffee chain, south Tel Aviv, January 2015. Less profit per sale, but more sales.
A branch of the Cofix coffee chain, south Tel Aviv, January 2015. Less profit per sale, but more sales.Credit: Ofer Vaknin

After having opened six cafes in Moscow, the Cofix Group, the Israeli cut-rate cafe chain, has now unveiled plans for expansion into 10 other European countries by 2021.

To position itself for its overseas expansion, the company has linked up with a group of investors and set up a holding company to roll out the chain’s presence abroad. The investor group includes the same individuals involved in Cofix’s Russian venture. The first branch in Russia opened in October. Of the six Cofix locations in Moscow, two are run by the Israeli company and four by franchisees.

The preliminary plan calls for the opening of Cofix locations next year in two additional European countries yet to be decided upon. The company said this is expected to be followed between 2019 and 2021 by an expansion into eight additional countries, apparently also in Europe.

The venture would not include possible expansion in Israel, its core market, or in the United States or Turkey, where Cofix is considering working with a separate investor group. The European expansion will apparently be accomplished by signing up franchisees, which is also the company’s model for most of its Israeli locations. In Israel, however, it also has 133 locations that it operates itself, along with a partnership involved in 29 Super Cofix grocery stores.

When Cofix was first launched, it shook up the Israeli café scene with a cup of coffee selling for 5 shekels ($1.39), a price that applied to all of the other items on sale. In February of this year, it raised the price to 6 shekels. In Russia, where Cofix CEO Haim Aharon said operating costs are lower, its coffee goes for 50 rubles a cup, or about 3.20 shekels.

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