Starbucks has added 51 new stores in the past 12 months: CEO
On Thursday, the local branch of the American coffee chain Starbucks announced its entry into six new markets in India – Siliguri, Nashik, Guwahati, Thiruvananthapuram, Goa and Bhubaneshwar – marking its biggest store expansion in a year. In an interview, Sushant Dash, CEO of Tata Starbucks Pvt. Ltd, talks about the impact of the new variant of covid-19 on the coffee chain business and the competitive landscape of coffee retail in India. Edited excerpts.
With new borders in place, how has business been affected?
We will follow the evolution of the situation. I think it is still early. With the new restrictions, in different states, i.e. different hours, capacities, weekend and night curfews, there is an impact, if I look at the operating index. from the stores from where he was to where we are now, in the last seven to eight days. But it is too early to say what the impact will be.
How do you deal with any employee shortages due to the current wave?
So far we haven’t had any problems. It’s not like we haven’t had a case, but things are still very much under control. We had no problem with where we had to close stores, or had to make changes in terms of timing etc. For now, at least, the numbers are very low, so no impact.
Will the new wave have an impact on the goal of opening more stores?
We have been very aggressive (with store openings). In fact, if there’s one title I would review over the past 12 months, it’s the rapid expansion we’ve made in terms of the number of stores and the number of cities we’ve entered. In fact, over the past 12-13 months we have opened 51 new outlets, which is by far the most stores we have opened.
Since August 2020, we have integrated 15 new cities. Indeed, in this period of one month, from December to January (2021-2022) we entered six new cities. Our expansion plans are therefore continuing. We are very optimistic about the potential of organized retail here. There could be temporary ups and downs due to covid-19, but in the long term, we remain optimistic about the Indian market and will continue to grow.
Is aggression part of a change in strategy?
I don’t think there is a change in strategy. It is the continuation of our strategy; we have obviously stepped up our expansion because we believe in the potential of this market. Our two partners are ready to invest and this is a huge advantage for us.
For example, everywhere we entered, in the next row of towns after the subways, the numbers were very good. We were well received and we found the consumer base. Sometimes the reason you have to wait for the right time is real estate. Because one is the potential in terms of numbers and consumers, but the other is also to get the right real estate to create the Starbucks experience. And it is sometimes a challenge.
How would you describe the competitive landscape we see in the coffee market?
So you obviously watch the competition closely, but I think there is enough room for everyone. We are a growing economy and the potential is sufficient. We’re more concerned with how we optimize our offering, how we provide consumers with the best Starbucks experience possible. This is actually our priority.
Are you going to continue with this rate of expansion in the next exercise?
The short answer is: we will continue to grow. It’s not just the strategy of the past 12 months. We will hopefully continue to step up, from the numbers we have now, and be more aggressive. We will open in the two new watersheds of the existing cities and examine the opportunities outside.
Are you planning to introduce lower prices in India?
We haven’t had this problem yet. As I said, the numbers are very good. In new cities, consumers want to experience Starbucks. So they come to the store. If I look at the numbers from a transaction or bill perspective, they are as good as any other city. Right now I don’t think we’re looking to do anything different from a pricing perspective.
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