YerbanLegend.com

I was in Sao Paulo, Brazil last week and wanted a yerba mate. The concierge at the Renaissance Hotel directed me to the closest mate bar, about two blocks away. It’s a small shop located in a prime location on the city’s main thoroughfare - Avenida Paulista. The shop is called Rei do Mate which means “King of Mate” in Portuguese, the language of Brazil; and in Portuguese the name yerba mate morphs into erva mate.

I ordered a cold mate with lemon at the Rei do Mate. It just hit the spot on this warm, muggy November day. Other people must have been searching for the same relief too because the place was packed. As I sipped from my glass, I recalled a few mate bars in Rio de Janeiro with the same name and later that day I passed by another Rei do Mate about a half mile away. Only then did I realize this place was part of a chain. I felt compelled to investigate.

The next morning I went back to the same Rei do Mate. This time I ordered a hot mate and asked the cashier if I could speak to the owner. It turns out that the cashier was the owner. An owner working the register may sound like a small operation, but there were six other people in bright green and blue uniforms working there too. They were all crammed behind the counter - filling orders, cleaning up, re-stocking supplies and being gracious to customers. I asked the owner if his little store was a franchise. He smiled and said that it was. I didn’t trouble him with more questions because the line behind me was quite long.

Back at the hotel, I did some follow up research and discovered that the Rei do Mate headquarters was just a short distance away. With the help and language skills of my new ally, Caroline the concierge, I was able to schedule an appointment with Joao Baptista da Silva, Jr., Director of Franchising.

Joao Baptista is a jovial guy who has a job that suits him just perfectly. His English is rusty, but his spirit and concern are not. He put everything he had into the interview. As we talked, he drew words, numbers, percentages, charts and pictures on a stack of blank paper that he brought to the conference room where we met. Joao’s Portuguese accent made the word mate sound like “MAHcheh” and Rei do Mate sounded like “HAY dew MAHcheh.” He apologized for his limited English, but I assured him that I understood as he re-told the Rei do Mate story.

The Company has roots dating back to 1950 under the name of Casa do Mate. In 1978 a different store was opened with the name of Rei do Mate – right next door. The two stores operated successfully as neighbors and competitors for some time before merging. The business was, and still is, family owned.

In 1991, Antonio Carlos Nasraui, son of owner Antonio Kalil, was graduating from the university and wanted to come to work in the family business. He had studied law and economics and this training was a perfect addition to the growing family business. There were four Company-owned locations at the time.

Making use of the legal knowledge and inspiration of Antonio Carlos, the Company began franchising in 1992. Timing was not the best however, because the whole country was struggling with hyper-inflation. Then, in 1994, the government made sweeping monetary changes to stabilize its currency. Rei do Mate survived this trauma and by 1998 the little chain of mate bars had grown to six Company-owned stores and 36 franchised locations. To guide the Company’s growth to the next plateau, Joao Baptista, formerly a franchising consultant, was hired to strengthen the team.

In 1998, 90% of the Company’s sales were from the mate drink and 10% were from everything else. Each store operated its own program and created its own problems. Joao referred to their 36 franchisees as their “36 problems.” To fix the problems and accelerate the Company’s expansion, some changes had to be made to their concept. New products had to be added to the menu and new standardized systems had to be developed to get all of the franchised locations doing the same thing.

Eventually, all systems and procedures were standardized. The erva mate was processed as a syrup concentrate to become the base liquid for fruits, flavorings and other additives. Both hot and cold drinks were offered; there was something for all tastes. Sandwiches, pastries and desserts were added to the menu. New items like “copao de pao,” a cheese and bread snack, and “tost,” a specialty sandwich, became signature offerings. They even added chocolate, cappuccino, coffee and espresso drinks. The result was dramatically increased sales per store and no loss in mate sales, which now represent only about 30% to 35% of sales depending on location.

Rei do Mate is now the fifth largest franchise system in Brazil with 233 locations. They have outlets in 17 of Brazil’s 26 states including 117 in the state of Sao Paulo and 78 in the state of Rio de Janeiro. The top four franchises in Brazil are:

1. Bob’s (hamburgers),
2. McDonalds (hamburgers),
3. Casa do Pao de Quiejo (coffee/cheese breads), and
4. Habbib’s (Middle Eastern fast food).

In a country that is famous for being the world’s largest supplier of coffee, fifth position says plenty for erva mate. Rei do Mate has won numerous awards and recognitions for excellence in service and customer and franchisee satisfaction.

I asked Joao if there were any other chains of mate bars in Brazil. He said that a Rio de Janeiro based company called Mega Mate began a franchising effort a few years ago. He thought that they had between 20 and 30 locations, but wasn’t sure. (I also remembered seeing a Mega Mate in Rio de Janeiro last year.)

Rei do Mate offers many modern ways to get your mate infusion, but if you still prefer your mate the traditional way, they will sell you a gourd, a bomba and a kilo of loose yerba. Oops! I mean loose erva.

 Salud!

To learn more about Rei do Mate, visit their website at: www.reidomate.com.br (Sorry, it’s in Portuguese.)