Starbucks Changes Its Menu to Tap Into This New Market
Starbucks (NYSE:SBUX) continues to percolate. The coffee retailer, which operates in 61 countries around the world, has begun its expansion into one of the company’s last untapped markets, India.
India, a nation of 1.2 billion people, is primarily known as a tea-drinking culture. However, according to government figures, coffee is becoming more popular; in 2010, annual coffee consumption rose to 108,000 metric tons, up 80 percent from the previous decade. Furthermore, cafes in India generated revenue of $230 million last year, and that number is likely to increase by 13 to 14 percent annually, according to estimates by the New Delhi-based consultancy Technopak.
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On October 19, the Seattle-based company opened the first Starbucks cafe in the country with its partner, the Indian conglomerate Tata group. The store, located in a historic building in Mumbai’s Horniman Circle area, was described by the non-profit Asia Society as a combination of “the Starbucks ethos with a local Indian sensibility.” This description applies to both the decor and the menu, which features scones and muffins as well as Indian tikka and paneer rolls.
Two more stores were opened in Mumbai on Wednesday.
“We’ve been trying to, in a sense, crack the code here,” said chief executive Howard Schultz last week. “Asia and the entire Pacific Rim present one of the most significant growth opportunities within Starbucks Coffee Company.”
Schultz did not announce how many stores the company ultimately intends to open in India. However, MarketWatch reported that the company is behind schedule.
Last year, rival coffee retailer Dunkin’ Brands (NASDAQ:DNKN) announced plans to open 30 Dunkin’ Donuts outlets over the next three years. The company opened its first store in New Delhi earlier in the year and now has five locations in the country.