KOLKATA: India has become the largest market in Asia in terms of food sales for Starbucks, the world’s biggest coffee retailer, its chief executive officer said.
Tata Starbucks, the 50:50 joint venture between Starbucks Coffee Company and Tata Global BeveragesBSE 0.97 % in India, wants to increase its food play in the country by micro-localising cuisines, apart from benchmarking its expansion by taking into account not just coffee cafes but also quick-service restaurants, CEO Sumitro Ghosh said.
“Starbucks is a beverage company, but the opportunity to expand into food is equally high in India. We are addressing both taste and health in coming up with our food offerings,” he said. While Starbucks already sells localised dishes like chatpata paratha wrap and murg kathi wrap across 113 stores in India, it has micro-localised two offerings for the just-launched Kolkata operations. This includes two new chenna-based desserts —chomchom tiramisu and chocolate rossomalai mousse.
“The food menu will increase, trying to address the various meal options. But again, we see several Indian consumers relishing a red velvet cake for breakfast instead of eggs and bread. We are trying to capture these food habits,” said Ghosh. He declined to share the contribution of food to Starbucks sales in India.
Tata Starbucks clocked net sales of Rs 272 crore, a growth of 14%, in the year ended March 2017 and narrowed its loss to Rs 32 crore, according to latest regulatory filings. The company announced its entry into Kolkata on Tuesday with three stores and plans to open two more this month, thereby adding 24 outlets this year and taking the total count to 115. It has operations in seven cities — Mumbai, the National Capital Region, Hyderabad, Chennai, Bengaluru, Pune and Kolkata.
Starbucks is evaluating entry into tier-II markets and smaller cities and is identifying places where it can open more than one store to make it a viable operation, Ghosh said. “While countries like China have far bigger operations with 3,000 stores, India has the potential to become one of the largest markets,” he said. The Indian business can potentially rank among top five markets for Starbucks, John Culver, group president of Starbucks International, said in October.
