Illy Versus Starbucks?

November 5/New York/States News Service -- Italian coffee maker IllyCaffe SpA has an aggressive plan to penetrate the premium U.S. coffee market without buying or renting its own coffee shops, The Wall Street Journal reports.

While the Italian coffee roaster has previously sold its coffee in high-end grocers, it has begun expanding its reach by signing agreements with U.S. cafes that agree to serve Illy coffee exclusively while allowing Illy quality control.

For the shops, aligning themselves with this premium brand has produced favorable results.

At Caffe Greco in San Francisco's North Beach neighborhood, sales have increased by 10% -- and profits by 3% -- since the shop began partnering with Illy a year ago.

Illy brought its Italian "Artisti del Gusto," or Artists of Taste program, over from Italy last year, supplying shops with espresso machines, branded cups, artwork, recipes and training. Afterward, the cafe becomes a certified Illy purveyor and must serve only Illy coffee for at least three years.

Some U.S. shops currently operate under Artisti del Gusto certification, and Illy plans to add 100 more by 2012, expanding its program to Canada and Mexico, too.

From the November 9, 2009, Prepared Foods E-dition