WHY STARBUCKS ISN'T ALONE AT THE COFFEE TABLE

Tata Starbucks, once synonymous with premium coffee and a lifestyle upgrade for the urban affluent, is at the risk of being upstaged by nimbler rivals like Blue Tokai and Third Wave Coffee Roasters that are upping their game

- PALAK AGARWAL

WHEN TATA STARBUCKS, a joint venture between Tata Consumer Products and Starbucks Corporation, opened its first Indian store in Mumbai in 2012, the iconic American brand promised to pioneer a new coffee-drinking culture in a country where the hot brew of choice has always been tea—a sweet, milky concoction sometimes spiced with cloves, cardamom and cinnamon, depending on local tastes.

Thirteen years and some 487 stores later, the ride hasn’t been smooth for the Seattle-based giant that has set itself the target of 1,000 outlets in the world’s most populous nation by 2028.

Its operating revenue grew 12% from a year ago to ₹1,218.06 crore in the financial year ended March 2024. The venture made a loss of nearly ₹80 crore in the year, a more than three-fold jump from nearly ₹24.97 crore the year prior.

That’s already prompting some analysts to question whether Starbucks is losing its mojo in a market where symbolised not just premium coffee, but a lifestyle upgrade for an aspirational India. Free WiFi alone is not enough to attract consumers.

CEO Sushant Dash is resilient in the face of competition heating up. Dash also has a major milestone to mark: the opening of the 50th Starbucks outlet and first drive-thru store in the southern Indian city.

“There’s no rocket science here,” says Dash, who is casually dressed in jeans and a round-neck tee, with the ease of someone who knows his morning caffeine fix. “If more people come to the store and we deliver value efficiently, we'll be profitable.” Dash took the reins at Starbucks in 2021.