Belleville: The

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20J A3G1 “The All-Ephants”
Rashmi Balasubramanian,
Giulia Barbero, Gavin Yeow,
Bryce Jones, Stefano Tasso

October 2nd, 2019

 Café De Belleville was founded on a mission to bring quality coffee to more
people. The goal is to become the #1 specialty coffee roaster in France

Today Jus de Chaussette operates 2 cafés, 2 boutiques, and 1 flagship store. The group also sells
experiences, training and consulting. Their online business is solid and growing.

What should be the path to growth? What should be its focus?

CONSOLIDATION OF
PRODUCT RANGE?
OPTIMIZING OPERATIONS
RESTRUCTURING OF EXPAND ITS CUSTOMER
TO REDUCE CRITICAL
SALES CHANNELS? PROFILE?
COSTS?

• INSTANT COFFEE • BOUTIQUES • LABOR • 25-40 YEARS OLD

• BEANS FOR WHOLESALE • CAFÉS • CAPITAL EXPENDITURE • ALL SOCIO-ECONOMIC
• BEANS FOR HOME • ONLINE BACKGROUND
CONSUMPTION • FLAGSHIP STORE
• TRAINING & • B2B
CONSULTING

Vision of the company long-term?

“Although I do not have a preference, our long-term goal is to sell the business. I have been looking around and
exchanging with potential buyers. Timeline would be to sell between 2 and 5 years from now.”
 Belleville has the competitive advantages to take advantage of the current market
opportunities and can transform its weaknesses into profit-generating strengths
STRENGTHS WEAKNESSES
o Instant coffee recipe – artisanal, hard to o Lack of economies of scope
repeat recipe o Unoptimized online – Paris
o Roasting techniques; Roasty o Fragmented branding and production/sourcing
o Brand image o Working capital timing problems (payments)
o Supplier relationships, B2B beans o Expensive rent and labor costs
OPPORTUNITIES THREATS
o Artisanal single-serve o Brand equity dilution
o Market share growth for specialty coffee o Fragmented and very competitive specialty
o Expansion outside of Paris coffee market
o RTD o Capsule and pods

Coffee Industry Profit Pool (France)

Parties outside of France Focus of this analysis
Profit Margin

20% 10% 7% 5% 30% 15%

0 10 20 30 40 50 60 70 80 90 100
% of Industry Revenue

Growers Exporters Traders Retailers (In Home

Intermediaries Roasters/ Manufacturers
and Out Of Home
Belleville has 3 potential growth strategies to fulfil its mission to put high
quality coffee in the hands of more people

Grow the B2C

1 B2C experience at a lower
cost
Bringing the Belleville
experience into homes
Retain existing B2B
B2B business focusing on
Paris

2 B2B Expand B2B business

Enhancing coffee
Strategic Options experiences in
workplaces in France
Trim the B2C business
B2C as a primary asset to
enhance Brand
heritage

3
Serve as bridge Leverage coffee
Fuel the specialty between roasters and knowledge and
coffee boom in Europe
producers “Roasty”
Strategic Option 1: Make consumer adoption easier via product
development and by optimizing online interface

Improved e-commerce interface

• De-mystifying coffee
• Homogenous branding
Consumer-friendly

Consumer-friendly product development

• Leverage on popularity of instant coffee
• Single-use artisanal options

Consumer-
unfriendly
 Strategic Option 1: Achieve more mindshare with consumers by
extending touchpoints with lower capital and labor investment

% EBITDA margin
0.00%
2015 2016 2017 2018 Brulerie: from HQ to
Epicenter
-20.00%
• Experiential consumer lifestyle
integration
-40.00% • Consolidation of best practices
and people
-60.00%

-80.00%

Multiple Pulse Points

-100.00%

• Coffee carts in high-yield

-120.00% locations
• Leaner, more agile model
-140.00%

-160.00%
Strategic Option 2: Expanding the B2B coffee business allows Belleville to
leverage its specialty instant coffee advantage and optimize cost structure
Belleville has a unique opportunity now to leverage its Brand Heritage and a instant coffee production potential
to expand its B2B presence to offices (non-HoReCas)

Optimize B2C to focus and improve

Grow B2B for scale and consistency
cashflow
First Mover as Start-up production capacity Retain Brand Retain La Fontaine café as a
Specialty Instant for instant coffee in France Heritage platform for brand
Coffee messaging and heritage

Opportunity in Office Grow awareness with Restructure Sell other cafes to reduce
segment offices segment costs and improve focus

Online model for office Online subscription

customers channels for scale and repeat
revenues
 Strategic Option 3: Fuel the specialty coffee boom in Europe
Belleville is strategically positioned to become the middle man between high quality
green beans and European specialty roasters

Sourcer and Distributor

Grow and • Knowledge and Become the sole
Coffee Growers / relationship with European Specialty
optimize distributor of high
Belleville Partners relationships coffee growers quality coffee beans
Roasters
with • Opportunities to to specialty roasters
Africa producers France
improve sourcing
margins sourcing by
increasing volumes
• Desire to help
Roasty Spain
Asia
growers become
Poland
sustainable
Sell proprietary technology
in SaaS model to help Germany
Work with roasters match supply with
Americas partners to ensure
demand Switzerland
roasters get their
beans on time

Logistics Partners
• Financing • Logistics
• Import • Quality Control
 We recommend Option 2: It provides larger scale sustainable growth while
maintaining Belleville’s premium positioning

Grow the B2C

1 B2C experience at a lower Pros: Improving brand equity
cost will aid in future divestment
Bringing the Belleville
experience into homes Cons: B2C market is very
Retain existing B2B competitive and advantages
B2B business focusing on are likely to be short-lived
Paris

2 B2B Expand B2B business Pros: Easy way to increase

Enhancing coffee volumes and realize
Strategic Options experiences in economies of scale
workplaces in France
Trim the B2C business
as a primary asset to Cons: Timely cashflow is still
B2C
enhance Brand an issue
heritage

3
Fuel the specialty
Serve as bridge Leverage coffee Pro & Con: No further
between roasters and knowledge and investment necessary – just
coffee boom in Europe
producers ‘Roasty’
relies on existing expertise