Coffee retailing in Tea Country !

2003-2007 ..Barista , Cafe coffee day , coffee day xpress ,qwikys ,bristo ....maybe more , suddenly coffee retailing was on expansion overdrive , one must say this was so true for all retail formats why blame coffee retailers alone !Industry size estimates vary between 250- 500 crores per year for this format .

Cut to 2009 , under the gloom of the recession hit economy and the general gloom around ,the coffee cups off takes must have slowed down for sure .

i)coffee retailing always was a game being fought on volumes and ticket size ( our estimate of Rs 100-150 per consumer ) , so paltry ticket size and the high rentals factors was always against it .
ii)India always has been and is a Tea country ! getting consumers to switch is going to be tough , coffee is an occasional beverage at the most .The idea was to catch the new gen Indian youth and get them hooked on to coffee too and give them a new destination to hangout .

So how are coffee retailers fighting back or trying to stay afloat :

i)Coffee alone was not enough , ie was a clear no brainer , so you have snacks , and other beverages including tea included in the menu card !
ii) Wi fi connectivity and browsing on a pay per use basis is another revenue stream .
iii)Impulse items like mouth fresheners , spices , imported beverages are part of the list of items sold , our estimation is that a decent 8-10 % of the revenue from a coffee store would come from non coffee products .
iv) Look at more realisation per cup markets , logically move to foreign markets and also look at some key tier 2 markets for expansion at lower opex cost .

Some fresh ideas that can make a difference , drive in coffee outlets , giant coffee take aways say coffee for a meeting ,delivered with cups !
Must add that the coffee retailers are fighting to stay fit and there are lessons to learn from them for the big retailers too .