Starbucks intends to open stores at 1,000 locations in India by 2028, as the company seeks to increase its presence in one of its fastest growing worldwide markets. The Seattle-based firm, which operates in India through an equal joint venture with Tata Consumer Products, now has 390 stores in the nation. According to a Tuesday statement, the company plans to establish one new store every three days as part of their market strategy.
Tata Starbucks’ 14% on-year sales increase in the three months ending September 30, 2023, was the smallest since the March quarter of 2020, when it had to close all of its outlets due to the COVID-19 pandemic.
Starbucks, one of the first international coffee companies to enter India, has been revising its approach in the country since last year, introducing a six-ounce cup priced around Rs. 200 and milkshakes in an effort to entice customers in the tea-loving nation.
What does Starbucks CEO says?
Starbucks’ aggressive India bet, led by Indian-origin CEO Laxman Narasimhan, who took over the company in March 2023, will include expanding its presence in tier two cities, opening stores in tier three cities, and increasing the number of drive-thru, airport and 24-hour outlets in the country in response to a growing consumer market for quick, on-the-go consumption. Tata Starbucks already has outlets in smaller cities like as Jalandhar, Kolhapur, and Siliguri. In conjunction with its growth into India, the corporation announced ambitions to quadruple its staff to 8,600 personnel.
“Over the past 11 years, the India market has grown to become one of Starbucks fastest growing markets in the world. With a growing middle class, we are proud to help cultivate the evolving coffee culture while honouring its rich heritage. With our trusted business partner Tata, and our green apron partners (employees), we are well positioned to capture the limitless opportunities as we open one store every three days in India and further our aspiration to become truly global,” Narasimhan said during his brief visit to India.
Tackling the Trends
India, with its young population of Generation Z and millennials and expanding disposable incomes, is a promising market for global giants of business looking for new methods to fuel development. In recent months, a number of global consumer businesses, ranging from chocolate producers to fashion, cosmetics, and home décor, have opened and grown in India. While India’s ability to deliver decent growth in the face of a global slowdown is reason enough for foreign brands like Starbucks to double down on the market, the company’s India push also comes at a time when young local players like Blue Tokai Coffee Roasters and Third Wave Coffee are expanding their operations.
“Already a trillion-dollar economy, India is at an inflection point and projected to become the world’s third largest by 2030, according to economic forecasts, making it a focus area of growth for Starbucks,” the company said, adding that it will focus on training local partners for jobs and promoting Indian-origin coffee to Starbucks customers worldwide.
Future Outlook
“Tata Consumer Products and Starbucks have enjoyed a remarkable journey, elevating India’s coffee culture and craftsmanship rooted in high-quality Indian Arabica coffee beans. As we move into the next chapter of growth, we will continue to develop India’s coffee culture to deepen connections with our customers, while innovating to bring our unique Indian offerings to the global stage,” said Sunil D’Souza, CEO and managing director of Tata Consumer Products.
Starbucks has announced that it will launch its second Starbucks Reserve outlet in India this year. Starbucks Reserve Store is the brand’s premium product, which it claims is aimed to “elevate the coffee experience in India.”Starbucks Reserve shops in India and the US will soon offer Monsooned Malabar, a combination of high-quality Indian Arabica coffee.
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