This archive report was first published on 8 October 2021.
Java House, a popular coffee chain with over 80 outlets across East Africa, has been struggling to stay afloat amidst the economic impact of the COVID-19 pandemic.
On October 29, 2021, a notice was circulated on social media announcing the closure of Java House Aero Club at Wilson Airport, Nairobi, effective at the end of the month. This move came as a surprise to many, given that the company had laid off several employees just a year ago.
Java House Express on Peponi Road, Westlands, ceased operations at the end of September, leaving many wondering if the company was planning to exit the market.
However, in a statement on its social media pages, Java House sought to dispel speculation, stating, "This is to notify our guests and the general public, that we are not closing all our branches. The closure image dated October 29 making rounds was meant for Java House Aero Club at Wilson Airport only."
Java House has been implementing cost-cutting measures to ride out the economic impact of the pandemic. In March 2020, the company temporarily closed 14 of its coffee shops in Kenya as foot traffic fell. The pandemic's impact on the food and beverage business was not abating any time soon, even after restrictions were eased.
"During the last few months we have looked at every aspect of cost reduction in the business, including re-negotiating rents, our procurement of raw material, our labour schedules and our utility costs and these are now moving towards a very low level in line with expected sales," the company stated.
Java House has been one of the biggest casualties of the coronavirus impact, with the hospitality industry suffering greatly. The company, which operates several brands, including Kukito, Planet Yogurt, and 360 Degrees Pizza, has been struggling to stay afloat.
Pre-Covid-19, Java House Group was on an expansion spree, but the pandemic has forced the company to re-evaluate its business strategy. In 2019, the Competition Authority of Kenya approved the acquisition of indirect control of Abraaj Investment Management, which owns Java House, by British equity fund Actis.
