F&H forays into packaged filter coffee segment

Fresh & Honest Cafe Ltd, a coffee vending company, has announced its foray into packaged filter coffee segment by unveiling its filter coffee powder 'Alive'. The company hopes to garner 10 per cent volume share of the organised packaged filter coffee market in the next one year.

The company has set up a state-of-the-art roasting and grinding facility with a capacity to produce 200 tonnes of coffee powder per month, in Chennai at an investment of Rs 5 crore.

At present, the packaged filter coffee market size in India is about 20,660 mt in terms of volume and Rs 300 crore in terms of value, per year. The market has been reporting a steady growth rate of 5.5 per cent every year.

Addressing a press conference after launching 'Alive', R Shivasankar, chief executive officer, Fresh & Honest, said that the unorganised segment was accounting for about 47 per cent of the packaged filter coffee market and F & H saw huge opportunity to expand its business in the segment. The value of 10 per cent volume share which the company targets in the organised segment by the first full year of operations, is estimated between Rs 12 crore and Rs 15 crore.

He added that the market share of the organised sector in the country is expected to go to 70 per cent by 2010, driven by the emerging trends like branding of commodities and the spread of coffee culture to other parts of the country. South India accounts for over 90 per cent of the packaged filter coffee market.

Though south is a key market for coffee, the consumption in the rest of the country is also growing, he added. The company has launched 'Alive' in Tamil Nadu, and would launch it in Karnataka and Andhra Pradesh in March, and in Kerala by April. It is planning its national foray in the next six months.

The company is planning to reach about 40,000 retail outlets in Tamil Nadu, Karnataka, Andhra Pradesh and Kerala in the next couple of months. It has already appointed about 100 distributors, covering about a million population in Tamil Nadu.

Alive comes with a blend of 70 per cent coffee and 30 per cent chicory and will be available in 50gm (Rs 9), 100gm (Rs 17.50), 200gm (Rs 35) and 500gm (Rs 86) packs.

In coffee vending business, the company has presence in 22 cities with 15 branches. It has installed over 2300 freshly brewed coffee vending machines across the country.

The company hopes to end this fiscal with a turnover of Rs 100 crore. It targets to garner 10 per cent share of the organised packaged filter coffee market, which is valued between Rs 12 crore and Rs 15 crore, in the first full year of operation.