Money Markets
Cold Stone Creamery is targeting Kenya’s growing middle class. File
By John Gachiri
In Summary
The company said it has found a ready market in the growing middle class that is “more exposed and has an appetite for variety”.
Cold Stone Creamery, an American ice cream chain, has
joined a raft of Western retailers setting up base in Kenya with its
first store set to open in Nairobi by the end of next month. Cold Stone
Creamery said its debut Nairobi branch is among seven it plans to open
over the next five years.
The ice cream vendor is entering the local market through a
10-year franchise deal with Om Nom Nom Mauritius Ltd, a firm that also
operates in the East Africa region and has interests in retail, hotel,
catering and real-estate industries.
“Om Nom Nom already conducts business in the
Nairobi market and their in-market knowledge is priceless. Cold Stone
Creamery will be the first of its kind in the Kenya market. We are
extremely excited about expanding into East Africa,” said Eddy Jimenez,
senior vice president of international operations and development at
Kahala Brands, Cold Stone’s parent company.
The company said it has found a ready market in the
growing middle class that is “more exposed and has an appetite for
variety”.
“It’s about making great memories for our customers
and we are delighted to become part of the Cold Stone Creamery family
and feel the brand and its fun; unique customer experience is a perfect
fit for the East African market,” said Roseanne Owiti, district manager
for the Cold Stone Creamery brand in Kenya. Subway and KFC are other
fast food chains that have expanded to the Kenyan market, equally
attracted by the growing middle class.
“The emerging and growing middle class in Nairobi
offers a perfect market for the food retail business. They are demanding
high quality meals and great customer service at an affordable price
point,” said Christopher J. Bak, chief executive of Liberty Eagle
Holdings, the franchise holders for Subway when the chain was opening
its store in June 2013.
The ice cream chain should also find customers in
Nairobi’s growing expatriate community, which is growing as more
international firms choose to relocate to Nairobi. IBM, Google, Visa,
MasterCard, Pepsi, Travelport and Dow Chemicals are some of the
multinationals that have chosen the capital city as either their
regional or Africa headquarters.
Investors have also been drawn by eateries and related companies that have successfully captured the market.
“Nairobi Java House enjoys an attractive
positioning as both aspirational and yet obtainable by East Africa’s
rapidly expanding consumer middle class and, as such, it sits perfectly
with ECP’s investment thesis,” said private equity firm ECP when it
bought a majority stake in Java back in May 2012.
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