Tata Consumer Products has said that the joint venture aims to ramp up the presence of Starbucks in the Indian coffee market. Tata Consumer Products MD & CEO Sunil D’souza said the company views a “huge opportunity” in India’s coffee market, which is still under-penetrated.
As of the September quarter, Tata Starbucks — a 50:50 joint venture between Tata Consumer Products and Starbucks Corporation — has a total of 457 cafes across 70 cities in India. That said, the company plans for a big ramp-up, with the ambition of opening a Starbucks cafe every three days in the country, with a plan to reach 1,000 cafes by FY28.
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Tata Starbucks Plans Rapid Expansion in India, Aiming for 1,000 Cafes by FY28
There is huge potential for the coffee market in India, D’souza said. Starbucks is already the largest coffee chain in India, but both its per capita consumption of coffee and the number of shops per hundred thousand people is small, compared to many countries with similar per capita incomes. D’souza explained that globally coffee is outgrowing tea, making it an enormous growth opportunity in a market like India, where coffee consumption is still comparatively young.
This, despite incurring losses owing to aggressive expansion; at the store level, Tata Starbucks continues to aim for profitability. D’souza recommended ensuring a healthy contribution of store profits and working on overall expenses — including advertising and promotional spending — for sustainability while the brand grows. This meticulous focus on unit economics is vital for their enduring success.
Tata Consumer Products is still retaining its target of 1,000 Starbucks cafes by FY28. In the short term, the number of store openings may vary but Tata Starbucks with the right strategy and focus on making the business profitable will be well poised to fulfill the demand for premium coffee experiences across the country, it had said. This bold expansion plan is a signal of their intention to dominate the premium coffee segment in India.
FAQs
How many Starbucks cafes does Tata currently have in India?
Tata Starbucks currently operates 457 stores across 70 cities in India.
What is Tata Starbucks’ expansion goal?
Tata Starbucks aims to open one new cafe every three days and reach 1000 stores by FY28.
