Reported by Saabira Chaudhuri

The owner of Peet’s Coffee is making a series of changes to its business to keep selling in Russia, offering a rare example of how some companies are charting a new normal as the Ukraine war rages on.

JDE Peet’s is renaming a major coffee brand in an effort to protect its global reputation, rejiggering supply chains and hitting back at those who say it should exit the country. 

Many Western companies quit Russia after its full-scale invasion of Ukraine last year. Some cited moral concerns, while others pointed to the cost and complexity of dealing with international sanctions. The coffee giant’s moves show how some of those that have stayed are shifting from being in wait and see mode to working actively to shape a longer-term future in Russia.

“It’s most likely going to be an enduring war, which means we have to take a more enduring solution,” said Fabien Simon, JDE Peet’s chief executive officer, in an interview.

Amsterdam-based JDE Peet’s is one of the few large Western companies to openly discuss doing business in Russia. Many companies are tight-lipped, limiting what they say to short, prewritten statements. Executives say they fear asset seizures or other retaliation by the Russian government, or a backlash from shoppers.

Simon gave three reasons why the company has no intention of leaving Russia.

First, he said coffee and tea are essential products—similar to bread, eggs or milk—in that they are affordable and “sustain health or life.” Second, JDE Peet’s has 900 employees in Russia who he says would be unfairly punished if it left. And third, Simon said that if the company were to leave Russia, its brands and intellectual property would likely be seized and given to a third party.

Simon’s priority now is ringfencing JDE Peet’s Russia business, partly to limit any reputational damage to its coffee and tea brands elsewhere.

For example, the company plans to remove its Jacobs brand, which is sold across Europe, from shelves in Russia by the end of the year. Instead, consumers will see a brand called Monarch.

Read full report: https://www.wsj.com/business/retail/why-this-coffee-giant-is-staying-put-in-russia-1c7e9ffa