New Delhi: Despite rising coffee prices and a general slowdown in urban consumption, Costa Coffee will maintain its growth rate in India, with the country expected to be one of its top five markets over the next five years.
India is currently in the top ten in the UK coffee chain market.
“We will definitely not save on growth pace (in India). We are happy with the growth rate over the past few years. We continue to work on further expansion. We now have over 200 stores in India. We plan to have 40 to 50 new exports per year,” Costa Coffee Global Ceo said in an interview on Wednesday, adding 40 to 50 new media each year. ”
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“India is one of the top 20 markets in the entire coffee sector in the world; for us, it is the top 10 markets. We believe that with the current growth rate, we can put it in the top five in five years, and that’s the desire we will follow… It’s very clear that this is our super important market.”
Costa Coffee was founded in London in 1971, competing with Starbucks and Barista. It entered India in 2005 through a partnership with Devyani International Ltd (DIL), which also operates KFC and Pizza Huts in India and is part of RJ Corp. Varun Beverages RJ Corp., the largest Indian bottler in Pepsi.
Costa owns more than 4,300 stores in 45 markets around the world, and in 2018 Coca-Cola acquired Coca-Cola for $3.9 billion.
To be sure, urban consumers hit by high inflation have been avoiding spending.
Last week Tata Consumer Products Co., Ltd. operates competitor Starbucks In India, through an equal joint venture, it has been opened for exports of coffee chains due to slowing general consumption.
However, the chain remains India’s largest cafe operator, with a total of 479 stores in India and plans to increase that number to 1,000 by fiscal 2028.
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However, Schaillee of Costa Rica said that while the coffee category grows by 5-6% per year worldwide, in India, the coffee category grows by 10-12%.
“The good thing about us is that our category is growing rapidly, and that category is growing rapidly. Throughout the F&B retail sector, we did see a slowdown in the second half of last year in India. In the first quarter of this year, this seemed to accelerate again. We continued in April.
Schaille said that more and more consumers in India are increasing their consumption of beverages. “They started moving from tea to coffee, increasingly moving to quality specialty coffee. This is due to the fact that they see coffee as a driving force for products that provide healthy energy, and for Gen Z it’s like badge value.”
Coffee prices rise
Coffee companies around the world are also dealing with record commodity prices.
In the fourth quarter of fiscal 25, the average price of Arabica increased by 97% year-on-year, while Robusta rose 65%. Schaillee said the company passes the price to consumers.
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He added: “We live in the highest price period of green coffee ever. The industry hasn’t seen it in 50 years. Arabica and Roberta have been at record highs. Of course, this is translated into the cost of a cup of coffee and we have to price it as consumers.”
“Our strategy is to reflect the impact of green coffee inflation on consumers, just like everyone else in the industry.”
Schaille said he was not too worried about the impact of tariffs on the global coffee retail industry, suggesting that any effect would be smaller and could affect green coffee prices.
However, he noted that Costa Coffee has limited risks in the U.S. market. In India, it offers most of the products locally.
