25.10.09

Lavazza to make India coffee hub

Till now it was just software and small cars. But if Italian coffee giant Lavazza S.p.A has its way, India might soon become the hub for coffee in Asia. In 2007, Lavazza walked into the country by acquiring the Barista coffee house business and Fresh & Honest Cafe, a company that specialises in serving corporate clients with vending machines and ground coffee products, for a reported sum of 100 million euros. And now, it’s time to expand, according to Gaetano Mele, CEO at the Italian Lavazza Group. On the cards is Lavazza’s first coffee plant outside home and an ambitious plan to expand its business in the Asia-Pacific region. About 60% of Lavazza’s revenues come from Italy and rest from foreign markets. Asia contributes a mere 5% to its coffers. So, it is no surprise that Italy’s biggest coffee maker wants to use India and its relatively cheaper raw coffee beans as a base to expand into other markets. “We are making fresh investments in building a coffee processing plant in Chennai on the lines of the one that we have in Turin,” says Mele. “It is our first factory outside Italy and should be operational by the first half of 2011.” Mele is banking on the country’s young population and its potential disposable income. China is also a budding market. In the pipeline is a range of designer cafes, such as the popular Lavazza Espression where décor and service make an exciting proposition to coffee lovers.

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