How Tchibo went from being a supplier of roasted coffee to being an internationally active retail company – and is continuing to develop.
Tchibo – the company’s founders Max Herz and Carl Tchilling-Hiryan came up with the name in 1949 by combining the first syllables of the surname Tchilling and the German word for bean, Bohne. Today, the name represents a unique business model, combining unrivalled expertise in the science of coffee roasting and excellent consumer goods presented in campaigns that change every week. It’s been a long road from a mail-order business for roasted coffee to an internationally active retail firm. And the road doesn’t stop here. We have big plans for the future too: by means of our holistic strategy, we want to make sure that sustainability becomes a key quality characteristic for all our products and processes.
Founded in 1949, Tchibo has been synonymous in the coffee trade with freshness and quality for over 60 years. Originally a mail-order business for roasted coffee, the company now has operations around the globe. Over the course of time, we have constantly expanded our range of products and services, and our strong brand is now an international mark of quality and variety.
Tchibo GmbH is one of Germany’s largest international companies for consumer goods and retail. The name Tchibo represents a unique business model, one that combines expertise in the realm of coffee roasting with an unparalleled range of consumer goods that changes every week.
Tchibo is the world’s fourth largest coffee roasting company, and it leads the market in roasted coffee products in four European countries. On top of this, it is Europe’s leading out-of-home brand for coffee. The leading light of our unique multi-channel sales system is our network of over 1,100 Tchibo shops, about 840 of them in Germany and a further 300 in Austria, Switzerland and eastern European countries. Customers can also buy Tchibo products via the internet or from about 29,000 concessions in food and specialist retail outlets around Germany. We have approximately 7,000 concessions in Austria and another 190 or so in Switzerland. Some 11,000 people work for us at Tchibo, over 7,300 of them in Germany. In 2010, the company recorded revenue of EUR 3.4 billion.
Tchibo GmbH is wholly owned by maxingvest ag, which manages the group’s investment portfolio as a holding company.
Structure of the maxingvest group in 2010
In 1955, Tchibo opened its first branch in Hamburg, laying the foundations for a mercantile success story typical of the city. Today, Germany is still by far our most important market, but our activities in other countries become more important each and every year.
Even back in the early 1990s, Tchibo was moving into other markets in Europe. Now we are active in Austria, Switzerland, Poland, Hungary, the Czech Republic, Slovakia, Russia, Romania and Turkey. We export our roast coffee to over 50 different countries. In 2010, sales outside of Germany accounted for 22% of our total sales, a figure which we had already achieved the year before.
Core sales markets
The core markets for our sales activities are Germany, Austria and Switzerland: these three countries are home to approximately 90% of our 1,100 Tchibo shops. By itself, our home market of Germany accounts for about 840 of these shops.
Our activities on the Austrian market started in 1993, when we founded our subsidiary Tchibo Austria. After the acquisition of Eduscho by Tchibo Holding (today maxinvest ag) and the subsequent fusion of the two companies in 1997 and 1998, we have now become the leader on the roasted coffee market in Austria. Based in Vienna, Tchibo Austria, with its two brands, Tchibo and Eduscho, offers customers the entire range of Tchibo goods, as well as products from the brand Tchibo Privat Schokolade.
We have been active on the Swiss market since 2001. There, our initial business activities were direct sales via two different channels, our mail-order catalogues and the internet. In 2002, we opened our first Swiss Tchibo shops in Lucerne, Winterthur and Basle. Just as in Austria, our product range of coffee and consumer goods is supplemented by our chocolate products.
As well as our core markets, we are now also involved in eastern European countries. We firmly believe that Tchibo’s business model has excellent prospects in the growth markets in eastern Europe.
We opened Tchibo shops in Hungary, the Czech Republic and Slovakia in 1991. Most of our coffee distribution is done via wholsale activities and retail.
Tchibo expanded into the Polish market in 1992, and we now have Tchibo shops in the country, selling the full Tchibo range of coffee products and consumer goods. We have been able to position ourselves as the leading name in roasted coffee in Poland, and we acknowledged the importance of the country’s market when we opened our own Polish coffee roasting facility in 1994. As of 2008, customers can also use our online shope for ordering consumer goods and coffee.
Since opening our shops in St Petersburg (1994) and Moscow (1995), Tchibo has been able to become one of the leading coffee retailers in Russia. We can also be found in the Romanian capital, Bucharest, having opened a Tchibo shop there in 2001, and Tchibo products are sold in supermarkets around the country. We moved into the Turkish market in 2006, when we opened a shop in Istanbul. We currently have a total of 37 Tchibo shops in Turkey, and more are planned.
Tchibo’s product range is nothing if not extensive. The fascinating world of coffee products is where we started out, and we are synonymous with top-quality coffee and outstanding service for business clients and private consumers alike. Our B2C activities also include a new selection of appealing, useful products every single week.
Coffee: an incomparable pleasure
For 60 years, Tchibo has stood for outstanding coffee quality and the incomparable pleasure that is good coffee. Now as ever, customers associate our brand with the best in coffee expertise and trust us to deliver it.
Our Gold Mocca brand got off to a flying start, and Tchibo was already the number one company in the German coffee market by 1958. Important coffee-related innovations enabled Tchibo to move into more and more new market segments in the years that followed. Our acquisition of the company Eduscho saw us add the Gala brand to our range of coffee products and become an all-round product provider. Today, Tchibo is present in every market segment relating to classic roasted coffee products, from decaf to full-strength espresso.
Coffee Bars: relax and enjoy
Tchibo’s coffee bars can look back on a long history rich in tradition. After six years of selling coffee by mail order, Tchibo opened its first shop with trial beverage sales – 1955 was the year that the Tchibo Coffee Bar was born. We have ensured that the Coffee Bar idea has kept up with our customers’ tastes since then, and today over 500 of our approximately 840 Tchibo shops around Germany sell choice coffee specialities and snacks.
Consumer goods: everything you could ever want
At the start of the 1970s, Tchibo began to expand its range of products bit by bit with selected consumer goods. Now, every week has a new theme at our shops, and we live up to our motto of “Only available at Tchibo” by presenting about 30 different products based on the week’s theme.
Over recent years, we have also made a name for ourselves as a company that markets holidays, services, mobile phone deals and energy products, all of which have now become firm fixtures in our business model.
Tchibo Coffee Service: a reliable partner
Tchibo Coffee Service was founded in 1972 and has since gone on to great success thanks to its professional out-of-home services. The company now supplies international business customers and major consumers in the hospitality and catering sector, as well as canteen operators and workplace caterers. This Tchibo subsidiary supplies up to 4 million cups of coffee every day. With “We enhance our customers’ success” as its motto, the company delivers integrated service concepts: tailored hot beverage solutions, top-quality equipment and fitting, in-depth training and the last word in efficient purchase support. Tchibo Coffee Service does business all over Europe as one of the continent’s leading coffee and food suppliers, and it has subsidiaries in five countries: Austria, the Czech Republic, Poland, the UK and the Netherlands. Outside of Europe, a dense distribution network takes care of the company’s activities.
Tchibo is synonymous with outstanding coffee and an appealing, ever-changing range of consumer goods. If we want to keep offering customers everything they have come to expect from us, we have to ensure that we deliver products and processes that are as environmentally friendly and socially responsible as possible. We want to make sure that everything we do is in line with the standards of responsible corporate governance, and we have therefore adopted an ambitious strategy.
In 2006, we developed our extensive “Strengthening Strengths” strategic programme, designed to make sustainability a permanent and integral component of our company’s business at all levels. The name of this corporate programme is a statement of intent: we do and will use our existing strengths to generate growth potential for Tchibo. The strategy comprises three clear targets.
- “Renewed Brand”: using our performance and innovation to increase the emotional appeal of the Tchibo brand in our core markets of Germany, Austria and Switzerland
- “New Growth”: strong expansion of the Tchibo brand in eastern Europe
- “Renewed Culture”: a corporate culture with discipline, entrepreneurial spirit and customer focus as its hallmarks
The successful implementation of this strategic programme has returned Tchibo to its traditional position of strength: even in crisis-wracked 2009, we defied general economic trends by continuing to develop. We have been able to maintain this successful development during the year under review, something that only goes to prove that customers respect and respond to a company when it commits itself to cost discipline, consistency, determined pursuit of targets, and a value system with long-term environmental protection and social responsibility at its core.
We will continue to follow our holistic approach in the years to come, and our programme “Building our Future on Tradition” is now focusing on high-quality business growth. The path we are following with our corporate strategy has an important goal: making sure that sustainability becomes a core feature of all Tchibo products and of all our major business processes.