MUMBAI/KOLKATA: Drawn by a growing number of well-heeled Indian coffee drinkers, leading coffee retail chains like Starbucks, Gloria Jeans, Barnie’s and Dome Coffee are whipping up entry plans.
The big-bang entries could begin as early as next year, industry sources said.
The buzz so far has been that Howard Shultz’s Starbucks Coffee is in advanced talks with a few leading Indian retailers.
The big players are eyeing a corner shop in the country’s high streets. The incumbents (Barista and Café Coffee Day) are sitting pretty or at least pretend to be as they claim that the costs for setting up and finding a place in the high streets in India would be exorbitant with the runaway escalation of real estate prices in India.
While Starbucks entry is almost certain by next year, industry sources say Gloria Jean’s, Barnie’s, Starbucks and Dome are said to be keen on an entry that could fructify by financial year 2006-07.
All eyes are on Schultz, a visionary who built the Starbucks chain from scratch and is credited to have taken coffee culture from the streets of Europe and put it on every street corner in the US.
Dome – is reputed to be a leading Australian and Asian specialty coffee and restaurant chain but much smaller compared with Starbucks and Gloria Jeans.
The Indian coffee restaurant story is gaining credence with the British coffee retail chain Costa Coffee setting up an outlet in New Delhi and announcing grandiose plans to open 300 outlets in India through a franchise agreement with the R K Jaipuria Group, at an investment of Rs 150 crore.
Coffee consumption in India, a predominantly tea drinking nation is on a clear ascend with consumption increasing from 55,000 tonnes to 75,000 tonnes in the last three years.
The activity has come after years of stagnation in the coffee market in India.
Industry circles say that Barnie’s Gourmet Coffee & Tea Company which has grown into America’s largest privately owned gourmet coffee and tea purveyor is also keen to set up a base in India.
Dome Coffee, is the dark horse in the pack and is styled around a Continental European bistro theme. It combines own specialty coffee blends with a full food menu. Dome outlets are concentrated in Australia, Brunei, Indonesia, Malaysia, Philippines, Singapore and UAE.
What’s more interesting would be how the Indian players- Barista and café Coffee Day react to stampede in the segment. It remains to be seen whether they will aid the entry by partnering the foreign companies.
But Barista officials boast that they will face the foreign competition head-on. “The coming year we will saturate the main cities with our restaurants and simultaneously enter newer towns Kochi, Vizag, Goa etc. We’ll clearly have a headstart over them,” he added.