2021 December-January Analysis

Georgia’s coffee market – small beans, big innovations

A perfunctory glance at Georgia’s coffee trade reveals a relatively small market that has registered modest growth in the last five years. However, an influx of new actors, both large and small, has infused the industry with innovative ideas that aim to transform the way Georgians drink coffee.

Photo courtesy of Shavi Coffee Roasters

Whether sipping on a cappuccino while catching up with friends at the local cafe or getting a quick caffeine fix on the way to work, coffee consumption is a global trend that is on the rise. Daily ritual, social lubricant, or much needed energy boost – whatever the motive, more than 2 billion cups of coffee are consumed around the world every day.

In Georgia, coffee is often enjoyed socially and at home, while its preferred consumption style varies from region to region. Sitting seaside in the west, traces of Turkish influence can be seen in the unfiltered cezve batumuri kava (Batumi style coffee). Café visitors in Tbilisi are likely to see menus featuring European style espresso drinks with baristas offering an occasional American filter coffee. For consumers at home, instant coffee still dominates the market. But as the country continues to develop economically, coffee companies are offering novel ways to enjoy the ubiquitous beverage with an emphasis on premium quality and innovative consumption methods.

High quality at home

Beyond statistical evaluations, a qualitative shift is occurring in the Georgian market towards coffee that is emphasizing premium products. This shift is part of a larger “third wave of coffee” around the world that focuses increasingly on creating high quality coffee with specific attention paid to the origin of coffee and how it is processed. While income limitations within Georgia’s consumer market make this type of premium good accessible only to a certain sector of the population, new actors are increasingly offering high quality coffee to enjoy at home and in coffee shops.

Leading the way among large-scale producers is Meama, a Georgian coffee company that prides itself on importing high quality beans from 18 countries and roasting them in its Tbilisi facility. Most notable is the company’s promotion of coffee capsules and machines for brewing at home, a trend more on par with European and American consumption.

Head of PR and Communications Madga Gugava says that at the time that “Meama started operating, coffee capsules were a completely new product in Georgia. The initial goal of the company was to create progress in the industry and offer a fresh way of consuming coffee for consumers who were still loyal to the traditional ways of making and enjoying their favorite drink.”

Another trend among consumers that she recognizes is an appreciation of coffee specifications. “We see an increased awareness of coffee quality and origin,” says Gugava. “This has further encouraged the company to continue actively working to offer customers new and diverse products, including an innovative coffee vending machine, ‘Dropper’, for offices.”

What’s brewing in Tbilisi’s coffee shops?

While pursuing a similar objective of delivering high quality beans like Meama, a group of smaller innovators within Georgia are capitalizing on the coffee craze through offerings of specialty coffee.

“Specialty coffee” is a term used to denote a way of producing coffee that currently only constitutes around 10% of the global market but puts a particular emphasis on both exceptional taste and the entire supply chain of coffee.

Ryan McCarrel, owner of Tbilisi-based Shavi Coffee Roasters, emphasizes the intricacies of the specialty coffee supply chain: “Every step of the process is important. From the smallholder farmers who are picking the cherries, to how they wash (or don’t wash) those cherries, to how your coffee is roasted and the barista brews it in your cup. Every stage of the journey has the opportunity to go really right or wrong. Grind size, water temperature, the pressure, the way in which the coffee is tamped – all of these things can affect the taste.”

Sitting in the micro-roaster combined café that he opened with his wife, Laurie Tovo, in late October, McCarrel compares specialty coffee to a fine wine: “When you compare coffee to wine, for example, there are many similar taste profiles. For instance, we are currently offering an Ethiopian anaerobic coffee that has been fermented for 120 hours and is comparable to tasting a qvevri wine. What we’re trying to achieve is positive types of acidity and a juicy, fruitiness on the other hand.”

It is this appreciation for different flavors and notes that makes him confident that now is the time to introduce specialty coffee to the Georgian market. “Georgians have an amazing palette and cuisine that makes them appreciate quality products.” He also says that his confidence in the changing culture of coffee in Georgia was partially built on the successful proof of concept developed by fellow roaster CoffeeLab.

CoffeeLab, which opened in 2016 in Tbilisi’s Saburtalo district, represents the first specialty roaster and café to enter the Georgian market. Founder Giorgi Aivazyan remembers the uphill battle the company faced in educating its customers during its first few years. “For many Georgians, the acidity or fruitiness of specialty coffee was far from what they associated with coffee. In the beginning, I may have had ten people come into the shop and try our coffee and only five would ever come back. We even had an instruction manual for our baristas to explain what to expect with each drink so customers would not be shocked. But those five that liked us, they always came back and they told their friends, which is how we grew to where we are now.”

Aivazyan’s dedication to educating customers during the business’s initial days is not the only innovative approach that sets him apart from the growing number of specialty coffee shops being established in Tbilisi.

Despite the fact that specialty coffee is a more developed industry outside of Georgia and tourists make up an easily accessible customer base, Giorgi established his café outside of Tbilisi’s touristic districts, making his business more reliant on the local market. “We have always focused on the locals, who provide a loyal customer base. That is what really helped us weather the pandemic. When we opened our doors after lockdown, we were immediately full again. This has allowed us to already surpass our 2019 growth and expand to three new locations in the next year.”

And while CoffeeLab is by all measures a success story, Aivazyan acknowledges how hard it is to change a country’s coffee culture. While his coffee shop offers a number of filter-based brewing options, including pour over methods like V60 and Syphon, 99% of his wholesale business involves selling espresso beans, given the higher popularity of espresso-based drinks in Georgia. Still, he contends that the business’s coffee wholesale, which currently services more than 150 horeca establishments and offices, has served as a useful method of increasing the visibility of specialty coffee in the Georgian market.

Co-owner of small specialty coffee shop chain Erti Kava, Ksenia Parjiani, also emphasizes that there is a ritualistic element of coffee culture that is not easily altered. “Coffee is a kind of habit. People associate the ‘best coffee’ of their life with their best memories and feelings. It is not always just about taste. In order to reach the Georgian market, you need to change their rituals around coffee.”

Mainstream potential?

As major actors like Meama continue to expand high-quality coffee offerings at home and in the office, an explosion of coffeeshops in the capital reinforces the thesis that there is a sector of the Georgian market that is looking for a place to sit, work, and socialize while sipping on a cup of great-tasting coffee. And while different actors have approached the market with their own unique perspectives, they all agree on one limiting factor: premium coffee comes at a premium price.

Erti Kava’s Parjiani acknowledges that the average income in Georgia has limited the development of the specialty coffee market. “When we opened our first coffee shop in Svaneti [editor’s note: mountainous region in northwestern Georgia], we specifically targeted tourists. The same goes for our second café in Tbilisi. Specialty coffee is very expensive for locals.”

CoffeeLab’s Aivazyan further adds that “as long as the average monthly income of Georgians is around 800 lari and the average coffee price ranges from 5-8 lari, only high-income individuals will be able to afford coffee every day. That is why instant coffee is still consumed in far greater amounts and the industry is not expanding quicker.”

Despite a limited consumer market, innovation in quality and consumption methods continues to expand. Much like the country’s fine wine scene, which has developed a new level of sophistication and appreciation in recent years, coffee consumption and culture in Georgia is evolving into a promising new industry.

____________________________ ADVERTISEMENT ____________________________