Tea is fastest growing category for us: Starbucks India CEO Sumitro Ghosh

Tea is the fastest growing beverage category for Starbucks India, its CEO Sumitro Ghosh told reporters at a gathering in Mumbai to commemorate the coffee house’s fifth anniversary in the country and the opening of its 100th store here.

Starbucks India, which is a 50:50 joint venture between Seattle-based Starbucks and homegrown Tata Global Beverages, brought its tea brand Teavana to its Indian stores in January 2017.

Today, Starbucks offers 19 varieties of tea beverages here and, according to Ghosh, Ice Tea is the most preferred in the tea-loving Indian market followed by flavoured offerings. Currently, coffee accounts for 60 percent of all the beverages offered at Starbucks’s outlets in India while tea accounts for the remaining 40 percent.

John Culver, Group president, Starbucks International and Channel Development, told reporters on Tuesday that the coffee chain will continue its investments in tea. Starbucks had acquired the US-based tea retailer in 2012 for $620 million and offers its beverages in all its 25,000 outlets around the world.

This is a trying time for coffee cafes in India. In 2016, all the popular caffeine retailers, including Café Coffee Day, Barista, and even Starbucks, had to resort to shutting outlets that weren’t picking pace. In September last year, Hindustan Unilever shut its coffee retail chain Bru World Café only five years after it had opened for business.

As Starbucks opens its 100th store, Ghosh said the world-class in-store experience that Starbucks offers its customers, its quality coffee products and partners - Starbucks calls its employees partners - are their secret to success.

Starbucks which currently has stores in six cities in India and has, on an average, opened 20 stores per year here for the last five years, will be entering its seventh city - Kolkata - in early 2018, Culver said. It will open at least three stores there, including one at Park Street.

Reiterating their focus on India and its importance – Starbucks has earlier said India will be one top five markets soon – Culver said they will double the strength of their partners to 3,000 in India and are expected to raise the number of women in their workforce to 40 percent from the current 25 percent. Currently, US is its largest market, followed by Canada, China, Japan and the UK.

However, both Culver and Ghosh refrained from giving a timeframe for when Starbucks in India will turn profitable only saying, it would be "sometime in the near future". Culver added, “We are investing here for the long term to build a strong foundation for growth in India”.