![]() There, in just the last five years, Luckin Coffee has used discounts to lure customers to its 10,000 mostly pickup or delivery stores. Starbucks has faced homegrown challengers elsewhere, most notably in China, where its 6,200 stores service the biggest market outside the United States. "We've lost 30 cups a day to them," said a barista at a Starbucks shop in Delhi that sells 7,500 drinks a month, referring to a Third Wave that opened nearby months ago, but already sells 3,700. He was among the analysts who felt the move by Starbucks, operating in India in a joint venture with Tata Group, could further boost its sales, which hit a record $132 million in fiscal 2022/23.Īlthough Starbucks still dominates in India, rivalry is fizzing in the capital, New Delhi, and the technology hub of Bengaluru, where many Third Wave cafes are often as crowded as Starbucks outlets. ![]() If adjusting portion sizes down to what is more normal helps make prices accessible, that's a double win." "Excessively large portion sizes are an American phenomenon," said Devangshu Dutta, head of retail consultancy Third Eyesight. Canada's Tim Hortons and Britain's Pret A Manger are also expanding, but have only a handful of outlets. India's small but fast-growing specialty tea and coffee cafe market is worth $300 million and set to grow 12% each year, Euromonitor estimates. Starbucks plans to open more stores in smaller towns, said an industry source, who spoke on condition of anonymity.īoth its new offerings are unique to India and unavailable in China, Singapore and the United States. The company has launched a six-ounce drink, "Picco", which starts at $2.24, and milkshakes for $3.33 as part of its revamp to target affluent Indians who prefer smaller servings. "As you grow in size, you need to get new consumers," said Sushant Dash, the chief executive of Starbucks in India, adding that the chain's "pricing play" would help shatter a perception that it is expensive. giant has taken almost 11 years to open 343 stores, in contrast with private equity-backed chains Third Wave and Blue Tokai that opened about 150 in the last three years. MUMBAI/NEW DELHI, June 7 (Reuters) - Starbucks is revamping its strategy to lure Indians, including children, with smaller, cheaper beverages as it looks to expand in small towns amid a fierce challenge from domestic startups in one of its fastest-growing markets.Īmong the first foreign coffee brands to enter tea-loving India, the U.S. American brand still sought after by many affluent Indians.Starbucks looks at small cities, rivals open in big towns.chain launches smaller coffee size unique to India Starbucks faces competition from local Indian startup cafes.
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