India?s largest coffee retailer Cafe Coffee Day (CCD), owned by Amalgamated Bean and Coffee Trading Company (ABCTCL), is planning to expand its international operations by opening cafes in rapidly growing coffee markets such as Central Europe, Asia Pacific and Africa.
?We are looking at both inorganic and organic routes of expansion in markets where coffee consumption is high,? Ramakrishnan K, president (marketing) of CCD, told FE. ?At present, we have only 20 cafes outside India and plan to scale that up in the near future.?
CCD?s move comes at a time when Seattle-based coffee giant Starbucks, which in partnership with Tata Global Beverages, is planning to open 50 cafes in India starting September.
CCD, which occupies 60% of India?s coffee market with more than 1,300 cafes in 185 towns, has also embarked upon a Rs 400-crore domestic expansion plan and will open around 300 new cafes during this fiscal. ?The store count is quite important in retail and we will reach 2,000 cafes by 2014,? said Ramakrishnan.
While India?s per capita coffee consumption is abysmally low at 82 grams, according to the Indian Coffee Board statistics, certain international markets which boast of traditional coffee-drinkers present attractive opportunities to cafe chains.
CCD believes its core strength lies in the fact that all its operations from the plantation and roasting to brewing and retailing of coffee is done by the company itself.
?We don?t work with franchises and all our cafes are company-owned. We grow the coffee ourselves and that allows us to put a check on our input costs, which cushions us from market volatilities,? said Ramakrishnan.
Besides charting an international expansion plan, the company has also revamped its menu. It has widened its price points, introduced quick bites, short desserts and expanded its range of packaged cold beverages.
?Our periodic researches show that there?s a growing acceptance for global cuisines among our consumers. The new menu takes care of the latest food habits,? said Ramcander Raman, head (food & beverages) at CCD.
According to a consultant, both Starbucks? and CCD?s business will have a good run in India. ?Starbucks will not dilute its premium positioning for the Indian market. It will target high-end customers while CCD will continue to be the mass favourite,? said Purnendu Kumar, vice-president (retail) at Technopak Advisors.
