Cafe Coffee Day looks beyond south India

Bangalore headquartered coffee retail chain Cafe Coffee Day is looking at traditional tea-drinking zones of north, west and eastern regions of the country to fuel its future business growth.

The coffee chain, which has 953 cafes spread across 141 cities in the country as of now, is planning to increase its outlet count to 1,150 by end of this fiscal.

“Presently, around 60 per cent of our coffee outlets are in north and western part of the country and we are planning to enter newer markets in this region that are presumably tea drinking,” Alok Gupta, director of Cafe Coffee Day, said.

Not only northern and western parts, the eastern region too holds promise for the company with the high-est growth rate, he added.

As per estimates, per capita consumption of coffee is about 600 gm in India compared to 10 kg in Austria and close to 5-6 kg in United States.

“The potential is huge in Indian market as coffee is fast becoming the beverage of choice for young India with rising coffee culture in the country,” he added.

Earlier, the coffee chain had announced it would inv-est close to Rs 150 crore to increase its presence in Tier-II and Tier-III cities.

The cafe market in India is presently pegged at Rs 5,000 crore in which Cafe Coffee Day has the largest market share of 60 per cent as of now.

Around 1,200 cafes have sprung up in India in the past 14 years, clocking an average annual growth of over 25 per cent in recent times.

As per industry estimates, there is scope for setting up another 5,000 or so outlets strategically close to offices, colleges and shopping malls in the country.

In a bid to tap this emerging opportunity, not only home grown companies but also the foreign retail chains are increasing their footprint in this segment.

International coffee chains like Barista Lavazza and Costa Coffee are drawing up ambitious plans to get a major share of this market.

“We do anticipate and welcome more players into the coffee retail segment as this will mean more choice for consumers,” Gupta said.