Java House: Bringing quality coffee and quality jobs to Kenya
The Java House chain has created 1,800 well-paying local jobs all held by African nationals and all top management positions held by Kenyans.
Sector: Food and beverage
Challenge: High quality Kenyan coffee is sold worldwide but it has not always been easy to find right within Kenya, which is a primarily tea-drinking culture.
Solution: A former relief worker turned entrepreneur in Kenya launched Java House to introduce quality coffee and the café culture to Kenya. From a single café in 1999, Java House expanded with the backing of the OPIC-supported Emerging Capital Partners, into 41 restaurants in Kenya and Uganda operating under three different food and beverage franchises including Java House cafes, Planet Yogurt self-serve yogurt stores, and the 360 Degrees pizza chain.
Impact: In addition to introducing quality coffee and comfortable restaurants to markets that had few alternatives, the company has created 1,800 jobs, all held by African nationals, and all top management positions held by Kenyans. And, by keeping more Kenyan coffee in the country, the Java House chain has add value to this local drop. One kilo of coffee beans sells for about $5 on the Kenyan wholesale market but by the time it is roasted, ground brewed and served it generates $160 of revenue to the local economy.
From relief worker to coffee roaster
California native Kevin Ashley came to Kenya as a relief worker in 1993 and stayed on to start an aviation business, transporting relief supplies to hard-to-reach regions such as South Sudan. Living in Africa, he became frustrated trying to find a good cup of coffee, particularly because he knew that Kenya produced great coffee. “I’d had wonderful Kenyan coffee in California,” says Ashley.
When Ashley and his partners decided to try to introduce coffee they understood they’d have to learn all about roasting coffee beans. They traveled back to California to take a roasting class, then purchased a roasting machine which they and shipped back to Kenya.
Along the way they learned that while Kenyan coffee is renowned over the world, less than one percent of it stays in Kenya. Since coffee drinking was fairly unknown to many locals, Java House initially was most popular among the expatriate community. Over time, that changed. Java House made some adjustments to the standard American coffee shop model, for example serving coffee in ceramic mugs as opposed to paper cups. “When you have an emerging middle class, people don’t want to stand in line for a cup of coffee served in a paper cup,” explained Ashley. “It is a demographic more like America in the 1980s.”
While Java House grew organically and swiftly, Ashley and his team said the biggest challenges they encountered were learning to scale and to manage a growing work force while building a brand that offered a consistent experience. “We learned as we went,” he said.
Help came from Emerging Capital Partners, one of the emerging market private equity funds that OPIC supports. ECP is a Pan-African investment firm whose staff is mostly based in Africa and it has forged strong ties and a deep understanding of local business climates. In 2012, ECP purchased a controlling share of the business, providing the financing and the business know-how to put the young chain on a growth path.
As for working in Kenya, Ashley says he found it to be an easy place to do business. “There is a young, optimistic, hardworking and educated workforce. Everybody wants a job and wants to advance.” Today, Ashley serves as chairman of Java House.
Java House and its affiliated chains now have 1,800 local employees in Kenya and Uganda, all employees are African nationals, and every top managment position is held by a Kenyan. Ashley credits the chain for pioneering career-track restaurant jobs. Java House’s lowest-paid employee earns twice the local minimum wage. All workers have health insurance and a month of paid leave as well as three months of maternity/paternity leave. This commitment to high standards has helped raise standards across the board for food service workers in Kenya.
This project was profiled in 2016