Tata Starbucks, the equal stake joint venture between Tata Global Beverages (TGBL) and Starbucks Coffee Company, on Friday, opened its first store in India located in Horniman Circle, South Mumbai.
The company said that two more stores would be opened next week in Mumbai — at Oberoi Mall in suburban Mumbai and at the Taj Mahal Palace hotel in South Mumbai. Early next year, the joint venture will open its first store in Delhi.
“This is the first time for Starbucks that we are offering coffee that is sourced and roasted locally,’’ said Howard Schultz, Chairman, President and CEO, Starbucks Coffee Company, while addressing a press conference here.
Starbucks runs 18,000 stores in 60 countries globally. “India is a very complex and complicated market to enter and it has been a lot easier when we came together with the Tatas. We will import the coffee beans but the core product of espresso will be sourced and roasted locally,” he said, adding “We must earn the respect of the Indian customer and approach this market with humility, as in the long term, this could be one of the largest markets for Starbucks.”
“We have 700 outlets in China, 1,000 in Japan and 8,000 in the U.S. We now have the opportunity to build a major business here in India.”
Responding to queries about the joint venture’s initial plans announced last year to open 50 stores in 2012, K. Krishna Kumar, Vice-Chairman, TGBL, said, “We may have taken a view that we would open 50 stores in 2012 a year ago but finding real estate is not easy. Now that we have a few coming up, we will scale up.”
While refusing to divulge the joint venture’s plans, Mr. Schultz said that in the near-term, “we will look at major cities in India. We are encouraged by the fact that there are many successful coffee stores already operating here unlike in China and there is ferocious competition.”
The products on offer include Starbucks’ espresso-based beverages, Starbucks VIA Ready Brew and Starbucks Reserves besides Tata Tazo tea and Himalayan mineral water (products of TGBL). The Tata Starbucks joint venture will also look at sourcing products from India and sell them in Starbucks stores globally.
“We could expand the partnership. There is a growing interest in exotic tea and the partnership could play a role there,” said Mr. Krishna Kumar. “Our Himalayan mineral water and other products could enter the Starbucks system and could penetrate the stores they have globally.”