India: the big international coffee players are looking to the Subcontinent

Interesting news comes from the Indian coffee sector. In India, the major international players are looking at the Subcontinent with increasing interest.

Barista Lavazza, the country's second largest coffee retailer, intends to focus on smaller Indian cities and is planning to open stores in cities identified as "Tier II", through a network of franchises (in India cities are classified on the basis to parameters concerning the economy, industry and investments: metropolitan cities are indicated as "Tier-I cities", followed by "Tier-II" and "Tier-III", depending on the level of services they are able to offer) . Through this operation, 15-20 new stores will be added.

"For the first time we have decided to also enter the "Tier II" cities: the various cafés will also be located in the capitals of the Indian federated states", said Nilanjan Bhattacharya, Operations Director of Barista Lavazza for the India and SAARC regions . The chain currently has 160 stores in total, mostly in the Delhi-NCR region.

Meanwhile, Tata Starbucks, a 50:50 joint venture between Tata Global Beverage and Starbucks Coffee Company, has opened its first three outlets in India, namely two in South Mumbai and one in Mumbai. Howard Schultz, Chairman and Chief Executive Officer of Starbucks, stated that "although it is a difficult market, especially as regards entry, India is currently, together with China, the main market in which the group intends to invest, with a precise long-term strategy”.

India, a major international player, is traditionally known as a major consumer of tea, but coffee consumption has increased exponentially over the years, with an increase of 80% compared to a decade ago. Current turnover is around USD 230 million, a figure set to grow by 13-14% annually over the next five years to USD 410 million. There are currently 1950 outlets in India, of which two-thirds have been added in the last five years. According to local sources, another thousand stores will be built in the next five years.

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