It’s mid-morning on a Monday and a Starbucks outlet in Koregaon Park in Pune is all abuzz. Green aproned baristas with their black Starbucks caps are all excited while camera persons jostle to get the best shot. It’s not every day that a global CEO visits the store and this morning sees Laxman Narasimhan, CEO, Starbucks, don the green apron of a barista and prepare filter coffee in its newly-launched six ounce ‘picco’ size, for first-time coffee drinkers and customers new to Starbucks. 

Laxman Narasimhan, CEO, Starbucks with Partners (employees)

Laxman Narasimhan, CEO, Starbucks with Partners (employees)

For India-born, Pune-bred Narasimhan, India is a very important market. His visit to India and to meet with the ten-year-old partner, the Tata group, is aimed at affirming Starbucks’ commitment. “India is definitely one of our fastest-growing markets, but it’s on a small base, relative to what we have internationally. On a global base of around 38,000 stores, we have only 390 in India. This is a game we are playing for the long term and we are looking at a business that delivers a great experience. We are pleased with the investments we have made in India and, together with the Tatas, we intend to do more,” says Narasimhan in an interview to businessline.  

With this avowed aim, following Starbucks’ long-term ‘triple shot reinvention strategy’ unveiled in November, Tata Starbucks Pvt Ltd, a 50:50 JV, has announced plans of operating 1,000 stores in India by 2028, equating to one new store opening every three days, up from the current 390 stores across 54 Indian cities. The strategy focuses on skilling local partners for jobs, opening new stores that serve customers with an elevated experience, and promoting Indian-origin coffee to Starbucks customers around the world. 

To double workforce

To achieve its target of 1,000 stores by 2028, the company will double its workforce to approximately 8,600 partners as it plans to enter Tier 2 and 3 Indian cities, expand drive-throughs, airports, and its 24-hour store footprint to serve customers where they are, says the company. “Over the past 11 years, the Indian market has grown to become one of Starbucks’ fastest-growing markets in the world. With a growing middle class, we are proud to help cultivate the evolving coffee culture while honouring its rich heritage. With our trusted business partner, Tata, and our green apron partners, we are well-positioned to capture the limitless opportunities as we open one store every three days in India and further our aspiration to become truly global,” said Narasimhan in an official press release.

Following the success of its flagship store, the Starbucks Reserve Fort Mumbai, which opened in 2022, Tata Starbucks will open the second Starbucks Reserve store this year as part of the long-term commitment to elevate the coffee experience in India. In line with the mission to elevate high-quality Indian arabica coffee, Starbucks Reserve whole bean coffee, Monsooned Malabar from India, will be available both at Starbucks Reserve stores in India and the US later this year. 

While Starbucks in India will take time to evolve as the legendary ‘the third place’, Laxman explains in the interview, “We have a launching pad now and the coffee culture in India is at the moment where you are going to see us move even quicker. The team here said they want to do one store every three days; last year we did 71 stores, so that’s one store in five days, and now we going to do one store in three days. India is a very important market for us and will be even more important in the future, also as a source of coffee. Monsooned Malabar will be launched in India and in the US as well. We are taking the actual blend to the US.” 

Asked if the tea-drinking habit will swerve towards coffee drinking, Narasimhan, whose grandfather and maternal uncle both worked in The Hindu group several years ago, says, “Look at it this way; we went to China 25 years ago; it was a fully tea drinking country. We worked really hard and we now have 6,000 stores in China. We open a store in China every 8 hours. However, per capita cup consumption in China is only 12 cups after all that. In Japan, it is at 280 and in the US it is at 380. The true test is not what happens in the next one year, but what happens in the next 10-20 years; that’s the perspective we have and with partners like the Tatas, we can think really long term about it and build a business that is substantial and more importantly makes an impact for India.”

Delivering consistent experiences

While Starbucks is perceived as premium, its introduction of the ‘picco’ size cups, available in six hot beverages, aims to offer its coffee in affordable sizes.

However, Narasimhan emphasises, “First of all, we want to be sure that the experience that we deliver is consistent with the values that we offer our customers. It’s very important for customers to realise a consistent experience. And, in addition to that is accessibility, in meeting customers where they are both in terms of formats and locations and also in terms of providing them options such as the recently introduced ‘Picco’ range, which is a great example of how we give customers an accessible choice and you will see us continue to do that as the market evolves; we are an experiential brand and we always watch that the value that we offer matches the experience that we provide and we will try to ensure that the two are always in sync.” 

 The press release also says that Tata Starbucks will empower women in India by providing vocational skills training for underserved young women seeking careers in the F&B retail industries. In partnership with The Starbucks Foundation, which awarded a grant to Trust for Retailers & Retail Associates of India (TRRAIN) to provide 2,000 young women workforce development training, skills building, and mentoring by 2024, Tata Starbucks extended on-the-job learning options for programme participants in stores in Bengaluru, Chennai, Delhi, Hyderabad, and Mumbai. 

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