The Indian coffee market is brimming with interest from international brands.
Yesterday (July 8), Indonesian coffee chain Wake Cup Coffee & Eatery opened its first outlet in Mumbai in partnership with the local food and beverage franchise company Gobble Me Good.
This marks the seven-year-old brand’s foray into the international market. Back home, Wake Cup Coffee operates 13 coffee stores and blends its own coffee.
Wake Cup Coffee is the latest entrant to India’s café market that is already flooded with several global brands, including Starbucks and Costa Coffee, and domestic major Café Coffee Day.
Valued at Rs2,570 crore ($374 million) in 2018, India is now the world’s 10th fastest growing market for specialist coffee and tea retail chains, according to a recent report by market research firm Euromonitor International.
The café chain market is one of the fastest growing categories in India’s consumer food service industry and is estimated to grow at 6.9% a year to Rs4,540 crore by 2023 in terms of sales, as per Euromonitor.
The potential has even led one of the world’s largest beverage companies to sit up and take notice. On June 27, a source based report in The Economic Times newspaper said Coca-Cola was looking to acquire a stake in Café Coffee Day. The aerated drinks major has not commented on the rumours.
But the buzz does not seem completely outlandish.
In the wake of a growing shift to healthier drinks, players like Coca-Cola and Pepsi have been diversifying their portfolio beyond carbonated drinks. And with out-of-home consumption on the rise, coffee chains are a pretty lucrative bet.
“Consumers frequenting cafes in India are primarily 18-35 years old which comprises the country’s primary working force with higher disposable income and fast-paced lives,” said the Euromonitor report.
In addition, large food companies, too, are eyeing coffee retail space. In June, India’s leading fast moving consumer goods company, ITC, launched its instant coffee brand, Sunbean. The brand will compete with Unilever’s Bru and Nestle’s Nescafe.
With the competition heating up, it’s to be seen who ends up brewing the best coffee.