Cafe Coffee Day (CCD), the retail wing of the Rs 750-crore Amalgamated Bean Coffee Trading Company, expects to record 20 per cent year-on-year growth helped by extensive expansion plans and strong demand for its new formats. The company is planning to have 2,000 cafes by 2014 and as part of its attempts to connect with consumers, may upgrade some of its existing regular formats.
Said Ramchander Raman, senior general manager – food and beverages, Café Coffee Day, “Right now we have about 1,100 cafes across India, which includes the regular Café Coffee Day outlets as well as our Square and Lounge formats. During the financial year ending March 2012, we will look at setting up an additional 50 Lounges and might set up one Square format each in all major metros. This will be the main driver for achieving growth of 20 per cent.”
Further, the company plans to upgrade a few of its regular formats into Lounges as this will help it attract extra eyeballs, he added. The company at present operates 17 Lounges and two Square formats.
Lounge is positioned midway between the regular cafes and the premium Square format. It is about 20 per cent more expensive than a CCD outlet, where the beverage is paired not just with fast food but also gourmet cuisine. It also allows its clients to customise the food items. High streets, premium malls and airports are the type of locations the company is identifying to set up the new Lounge outlets. Square, on the other hand, is more exclusive than Lounge. It serves single-origin coffees and is aimed at connoisseurs.
Though regular cafes still remain the company’s major growth driver, CCD sees Lounge becoming a significant contributor to growth in the next few years. “Compared to cafes, Lounge will witness 20-25 per cent increase in realisation per person,” said K. Ramakrishnan, president, marketing of CCD.
The company is more focused on the Lounge format because it requires more space and expertise than Square, he added.
According to Ramakrishnan, India’s per capita consumption of coffee is a meagre 85 grams, thereby offering a huge opportunity to expand.
The Rs 800-crore retail cafe market has brands like Barista, Costa Coffee, Gloria Jean’s Coffees and Aromas besides CCD jostling for market share.
Source : Financial Chronicle
