6.12.10

Starbucks renews interest in India

Starbucks’ renewed interest in the India market comes at a time when company CEO Howard Schultz, at its biennial investor conference in New York on December 1, said that the retailer was in discussions with potential partners to open stores in India. The company revealed a new business plan at the investor meeting which will focus on major acquisition and expansion activities.
Industry sources indicated that Starbucks was prepared to take the franchise route even as it awaits the government’s plans regarding FDI in retail to unfold. In fact, it has stated earlier that new additions of stores in both the US and in the international market are expected to be primarily licensed stores. The company says it plans to open around 100 stores in the US and 400 stores overseas in the next fiscal year and continue to ramp up store openings in 2012 most of which will be licensed. “They would like to announce a strategy for India, including a partner and a pilot programme, within 12 months,” added a source in the know of the developments. Starbucks has had multiple false starts in India in the last few years, including a well chronicled alliance with Kishore Biyani’s Future Group, which failed to clear the FIPB hurdle. One of the most successful retail services of modern times is now striving hard to get a toehold in one of the fastest growing consumer markets in the world. During the downturn in ’08, it shut 800 under performing US stores as growth slowed down. But now Starbucks plans to expand to 1,500 stores in mainland China by 2015, up from 220 stores as of October 3, and grow in Brazil, Russia and India.

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