Issue 1, 2013 February-March - Investor.ge

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years due to the increased interest ofstudents who wish to go on to Universitystudy, either in Georgia or abroad,” hesaid. “Whether or not it is an attractivebusiness sector, there is a real need forprivate school education.”Head of the European School (InternationalSection) Robert Thorn addedthat the accelerated pace of economicintegration within the region has createdspecial demand for English-languageeducation.“Georgia has made attempts to attractinvestors and it [has] a strategic positionin the region. It is, for some businesses atleast, a place to be successful,” he said.“Also, regional politics has had aninfluence- with Turkish, Azeri and Iranianbusinesses moving into the area.With this, business people and other expatriotslike to come with their familiesand so we have seen a huge growth inex-pat students applying to the school.”Gary Crippin, head of the GuivyZaldastanishvili American Academyin Tbilisi (GZAAT), noted that theincreased supply of private secondaryeducation institutions in the city isclosely tied with business development- high-quality educational institutionsare essential for attracting and retaininginvestments within the country.According to Crippin, “good privateschools are essential to a healthy businessclimate. If business owners and managerscannot find top quality schools in whichto enroll their children they will considerrelocating or will be forced to pay sizablefees to send their children to boardingschools abroad.”Unlike more traditional businessareas, however, competition among theschools is more complex. Many parentsmeasure good private education by thequality of the faculty and their availabilityto students. Libraries; science andcomputer laboratories; well-equippedclassrooms; dedicated theater, arts andmusic rooms; and sports halls are also allpart of creating a stimulating educationalenvironment that allows children to testtheir exciting new skills and knowledgein action.When asked to define their market advantage,most private education providersemphasize highly-qualified teachers,a student-oriented learning environment,and activities that include communityservice, arts, music, and sports. Othersconcentrate on providing professionaldevelopment skills that make for moreopen-minded and well-rounded youngadults. The Georgian private educationmarket has evolved to include schoolswith ambitious aspirations and impressivecurricula. As with all business, competitionmakes for a better value offeringto the parents. Nevertheless, this is oneproduct that does not wholly depend onthe producer. Tamar Karchava, EducationUSA adviser at the InternationalCenter of Education, stressed that studentsplay an equally important role inmaking sure they utilize the opportunitiesthat private schools provide.“A lot of the students from bothpublic and private institutions come toour center for additional help and guidance.We have a very good record forboth types of schools. Although there isno magic formula or easy answer - goodeducation is a lot of work, and none ofour students have attained easy success,”she said. “It is not possible to make upfor years lost in the elementary and secondaryschool systems during the finalgrades of high school. Consistency isthe key.”
Wake up and smell the coffee,Tbilisi.For a city where coffeehas meant fake Turkish grounds or CaféPele instant for the past two decades, anew love affair with Italian brews anddeep, rich and foamy coffee drinks istaking over – from higher sales at supermarketsto new cafes and coffee shops.The new business has been a boomfor coffee imports, according to GeoStat,the state statistics body. Instant coffeeimports have doubled from $6.62 millionin 2006 to $15.86 million in 2011, thelatest available figures.The import of unroasted and roastedcoffee beans has also grown- from $6.45million in 2006 to $ 13.11 million in2011). No data is available for 2012,although studies among coffee drinkersindicate the numbers will continue togrow: the average annual coffee consumptionper household in Georgia was2.7 kg in 2011, up from 2.5 kg in 2006.Iliauni Business Review, an onlineportal of Ilia State University’s Facultyof Business, studied coffee consumptiontrends at supermarkets in November2012, concluding that, out of 1,038buyers interviewed, 86 percent- or 187–said that they are coffee drinkers, with28 percent drinking coffee more thantwice a day.Nearly half the respondents buy coffeebased on taste, while 13 percent areguided by price.Enter Thee, Starbucks?Georgia has always had a love affairwith coffee, especially the tiny tumblersof Turkish brew whose coffee groundsare said to hold the key to the future, aswell as a healthy dose of caffeine.But unlike coffee connoisseurs in theWest, Georgians were largely limitedto instant Nescafe if they wanted theirmorning cup of joe in any other form.The new fascination with coffee drinks,however, is changing that.Lali Pipia, a manager at Latte, a coffeehouse in the café-heavy Vake neighborhood,told Investor.ge the business ofcoffee brewing is “bustling.” “If I wereto assign a score, I would give it nine outof 10,” she said.According to Pipia, the café servesaround a thousand coffee drinkers amonth, who consume five kilograms ofcoffee beans. The most popular brews arecappuccino, latte, espresso and Americano.Long-standing cafes, like CoffeeHouse on Kazbegi Avenue in Saburtalo,which opened in 2002, say the growingnumber of cafes has not gone unnoticed– even though they have not yet resultedin diminished sales.“Back in the 90s, wesimply had no rivals. Now competitionis increasing but our clients remain loyalto us,” said Tea Kvatadze, manager atCoffee House.Coffee House is the city’s veteranbrand in this business, with its first caféhaving opened in 1998 in Vake, and twoyears later a second in Vera district. Thecafé on Kazbegi Avenue, apart fromserving drinks, also sells coffee groundswhich are imported from the US andhas daily sales averaging around twokilograms. Zurab Liparteliani, owner ofCoffee Time Starbucks Coffee, also inVake, said the growing trend of highendcoffee drinkers led him to invest$40 thousand in the coffee business.He opened his café in November, andhopes sales will eventually lead to a realStarbucks license – the first of its kindin Georgia.“For a while we will be merelyobserving the situation in order to understandwhether the market is ready toexpand,” Liparteliani told Investor.ge.The key indicator, he stressed, is turnover.Once sales reach 60-70 kg monthly,they will consider expanding the business,which may also include purchasingthe Starbucks license. Currently, the caféconsumes 10 kg coffee per month.Reaching that magic number hasbeen a challenge in the past: the muchawaited Starbucks café in Tbilisi Mallhas been postponed, reportedly due aperceived lack of potential customers.“We had open negotiations, but Starbucksthinks that the Georgian market isnot ready for them yet. We think it is butthey have their standards,” Mariam Kutateladze,marketing manager at TbilisiMall, said. Starbucks, according to her,did not elaborate what would be the desiredindicators that Georgia is “ready.”Coffee drinkers in Tbilisi, however,remain hopeful: there are over 12,000‘Likes’ on two Facebook pages dedicatedto bringing Starbucks to Tbilisi.
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