Starbucks India, the joint venture between Starbucks and Tata Group, achieved a sales milestone of over ₹1000 crore in India after starting operations just over a decade ago.

What Happened? The Indian unit of the world’s largest coffee retailer increased sales by 71% to ₹1,087 crore in the fiscal year 2022-23, propelled by the addition of new outlets and an increase in demand for quality beverages in Indian metropolitan areas.

Tata Consumer Products’ (TCPL) latest quarterly earning report revealed that Starbucks India had conducted a pilot program in four cities in India in 2022 to drive familiarity among consumers and create more opportunities for them to visit Starbucks, with the goal of increasing consideration among different types of consumers.

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Localisation and Increasing Competition: Starbucks, which began operations in India in 2012, now boasts a store count of 333, adding 71 stores over the last financial year, which analysts say is the fastest expansion of stores. Starbucks has also revamped its menu to offer localised and more affordable options such as masala chai, filter coffee, freshly assembled sandwiches, bite-sized snacks, and a smaller beverage cup to attract consumers.

The popular global coffee chain aims to expand rapidly in the coming years and enhance its relevance for various consumer segments. In 2023, workstreams that demonstrated improved operating metrics in the pilot program will be launched nationally, says TCPL.

Compared to its competitors Cafe Coffee Day and McCafe, Starbucks’ positioning in India is premium, but it faces competition from Tim Hortons and Pret a Manger, which have already established a presence in the country with analysts expressing caution that high pricing by Starbucks could be at risk.

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