Vida e Caffè is the largest coffee retail chain in South Africa. The group has sites throughout South Africa in standalone locations on high street and malls, as well as within Shell convenience stores and forecourts. In this interview, CEO Darren Levy speaks on how they had to close some shops for good due to the Covid-19 pandemic. Levy let us in on the company’s numerous new ways on bringing hot coffees to our door steps.
Darren Levy, Vide e Caffè CEO, on the challenges of Covid-19:
We’ve obviously been through some very challenging times. The 27th March last year was the day that every single store closed and we sold no coffees – which was quite a thing to actually acknowledge. We thought we were going to be closed for three weeks. We would struggle a bit because organisations in the hospitality industry typically don’t have vast sums of working capital, sitting to fund their businesses.
Three weeks in a business like ours, [with] nearly 300 stores on the continent. We had a plan and clearly that didn’t happen. The stores remain closed for longer. More importantly, it’s taken time to resurrect them still. In many cases, in corporate spaces, in areas that depend on tourism – in the airports – we still trading under very reduced and challenging conditions. Obviously, that’s forced us to make certain decisions and do certain things, enabling us to be very much still open, trading and in many respects, stronger and better than ever.
I think it’s an experience that a lot of businesses have had to experience through the changes that they’ve had to make. Lots of initiatives, but very delighted and proud to say that under the current circumstances, we are stronger than ever.
On the decision to not reopen some stores:
We didn’t expect, looking at three weeks, that some wouldn’t open. As time went on, one of the things that the pandemic forces you to do is accelerate a lot of your activities – one of which is making those hard decisions. Being 20-30 years in the retail industry, you look back and it’s those same old classic lessons of, “why didn’t you cull those few stores a little earlier?” Fortunately for us, the number of stores that closed as a result of the pandemic, were less than one handful.
We have a relatively efficient number of stores and one or two, which were coming to the end of the lease or we could fast track the closure, we made those decisions. Coupled with that is the consequence on staff, which was a principle on which we based all our decisions, was how we keep the business alive to look after our staff. We have about 1,000 staff members and about half of them are employed by the group itself – in the stores that we own – and the other half in our franchise network. That was really the priority. Through restructuring, savings and various revenue generation activities, we managed to look after our staff throughout the period.
On pivoting towards using delivery services:
That’s probably been the most successful pivot that we’ve made throughout this period. Fortunately, we are a brand that’s very innovative and we actually started working with Mr. Delivery and Uber prior to the pandemic. We spent months testing how to deliver a coffee in a car or on a motorbike, obviously realising it would never exactly mirror the in-store barista experience that we knew. We were watching these trends globally. The pivot for our business was just acknowledging that [the pandemic] is an accelerant.
It just made us fast track whatever we’re doing. We almost have Mr. Delivery and Uber running in all of our stores. The delivery volumes, believe it or not, in a coffee business – although food is a big part of our offer – have not just doubled, they’ve increased over 500% (the volume of product that’s moving through delivery.
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