Starbucks Doubles Down on India Expansion Despite Rising Losses
Tata Starbucks invests heavily in India, prioritizing growth over profitability.
Starbucks Corp.’s India arm, Tata Starbucks Pvt. Ltd., is accelerating its expansion across the country despite nearly doubling its losses to ₹1.5 billion ($16.5 million) in the fiscal year ending March, according to Tofler data. Revenue, however, grew by 4.8%, highlighting strong consumer demand amid widening losses.
CEO Sushant Dash emphasized that India remains a priority market for Starbucks, ranking among its top five globally. While the venture has achieved cash-positive operations, Dash declined to provide a timeline for reaching full profitability, stating that growth and footprint expansion are the primary focus.
To strengthen its market position, Tata Starbucks is adding new stores and tailoring its menu to regional tastes. Innovations include protein-packed coffee drinks, low-calorie snacks, and local offerings such as Mumbai’s Vada Pav-style buns, Kosha Mangsho-inspired wraps in Kolkata, and Malabar egg roast in southern India.
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The strategy also taps into evolving consumer trends, with younger customers favoring cold brews, refreshers, and plant-based milk alternatives. Health-conscious products such as Soya Protein Toasties and Chicken Ragi Flatbreads are designed to align Starbucks’ offerings with India’s fitness-focused demographics.
Expansion is already yielding results, with same-store sales growth reaching 3% for two consecutive quarters. The chain added 12 new outlets in the latest period, bringing its presence to 504 stores across 81 cities. Tata Starbucks continues to compete against agile local coffee brands while cementing its position as India’s largest coffee chain by store count.
Looking ahead, Dash stressed that sustaining growth in India will require ongoing innovation and menu localization, ensuring the brand remains relevant to changing consumer preferences while solidifying its footprint in the world’s second-most populous country.
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