Global Leadership: Export of Coffee to Canada - Essay Example

There is a significant amount of information from Statistics Canada, Agriculture, and Agri-Food Canada, but a great deal of information also comes from associations such as the coffee association of Canada and the Coffee Crew of Canada.

The Coffee Association of Canada (2003) indicated that coffee is among the most popular beverage choices in Canada with over 81% of Canadian adults drinking coffee on an occasional basis and over 63% of Canadians drinking coffee daily. Building on this previous point, Agri-Food Canada (2010) indicated that coffee makes up approximately 16% of all non-alcoholic beverage sales in the Canadian market. Source: Agriculture and Agri-Food Canada. It was further indicated that average coffee consumption is approximately 2.6 cups a day which exceeds the relative frequency of the United States. Moreover, Canadians consume coffee through several different channels, homemade, at work, through specialty shops discount coffee retailers.

By the sheer presence of major specialty coffee shops such as Starbucks, Second Cup, etc., and major discount retailers such as Tim Hortons or the coffee shop it is apparent that Canadian consumers are familiar with coffee and as such will not need to be educated as consumers on how to consume coffee. Nixon (2009) indicated that the market for high-end coffee consumption in Canada is competitive but it is easy for foreign companies to invest into. In 2009 two American companies entered the Canadian market by purchasing outright a popular Canadian chain (Timothy’s Coffees of the World).

Green Mountain Coffee Roasters inc purchased Timothy’s wholesale business and Bruggers Enterprises Inc. purchased the retail operations. What this demonstrates is the fact that the Canadian Market is relatively easy to invest in, because retail and wholesale operations can legally enter into the Canadian market without legal hindrance. However, the downside to this is the fact that this research demonstrates that the Canadian market is transparent and highly competitive. National Geographic coffee production map (2011) indicated an interesting consideration which is that there is not any domestic commercial production of coffee in Canada.

Canada has a climate that is unsuitable for coffee bean growing. All raw products need to be imported into Canada and further treated for consumption. Several coffee roasting and related production facilities exist in Canada. Agriculture and Agri-Food Canada (2010) indicated that the overall market for tea & coffee is approximately $1.5 billion and has had an increase in retail coffee sales of $647 million which has increased over the previous year. Moreover, there has been a significant decrease in the production of manufactured coffee in the Canadian market; however, the consumption of coffee has increased.

It could be the case that greater quantities of finished coffee are being brought into Canada. What all this information demonstrates is that there is indeed a significant market for coffee in Canada. I believe a strategy of importing specialty high-quality Arabica coffee already processed and packaged and sold through the proper channels would be an excellent business opportunity.