Coffee franchise Nov, 30 2012

Express way to quick success

Offering quick and ready-to-eat services to the people who are always on the move, Coffee Day Xpress (CDX) is a brand for the young and the young at heart. Read on to know more about the brand’s growth and success journey via franchising.

By Rita G Chauhan
Sub-Editor
Express way to quick success

Coffee Day Xpress (CDX) is a unique beverage retailing concept that caters to today’s fast paced lives by providing a healthy and tasty bite on the move. It was launched in 2003 by Bengaluru-based Amalgamated Bean Coffee Trading Company Ltd (ABCTCL), the parent company of Cafe Coffee Day (CCD). The concept bridges the gap between the leisurely coffee experiences that CCD provides and that of serving a quick cuppa from a vending machine. The idea was to offer the very best in every segment related to coffee to Coffee Day patrons.  K. Ramakrishnan, President Marketing, Cafe Coffee Day informs, “CDX caters to the mobile population of a city who is always on the move. It targets youth, students and corporate executives looking for a quick and healthy munch while on the go”. 

Brand’s USP 

Over the years, CDX has developed many unique trends specific to the coffee industry and has become recognisable for serving the taste of the brew from home. Its exceptional and quality products and services are its USP.  Most of the coffee is sourced from the company’s own plantation in Coorg and Chikmagulur which results in better quality control and timeliness. The brand’s menu varies across regions and it includes the best of the regional delicacies as K.Ramakrishnan tells, “We offer our customers an unmatchable product list, consistency of the products and the level of quality. We maintain certain standards which is unmatched by competition which are primarily local vendors”. Its wide ranging menu includes products like hot chocolate, coffees, fresh sandwiches, wraps, subs, samosas, puffs, burgers, and pastries in elegant and hygienic wraps to be had at cafes or as take always. Moreover, the brand constantly strives to offer new flavours and products, with the traditional Indian touch.

CDX’s success journey

In the past few years, there has been a major shift in people’s food habits in Indian metropolitan cities. In metros, people have busy life style and prefer to eat instant food. Factors like rising dual incomes, standard of living, convenience, and influence of western culture has further fuelled this trend. In response to rising demand, CDX pioneered the concept of fast, hygienic, and convenient-to-eat food to consumers on the go at affordable prices. The brand became a hugely successful takeaway concept within the few years of its inception. With its speed of service, high hygiene standards, affordability, freshness and quality of services, CDX has gained popularity and quickly reached 142 cities in India. K.Ramakrishnan says, “In today’s fast paced lives, CDX is a place where the harried metropolitan consumer can pause for refreshment before getting on with life. With its speed of service, CDX kiosk system is a hugely successful takeaway concept”.

Franchising fuels growth

The clustering mode of retail expansion helped CDX to reach its consumers easilyand achieve endless success. The brand has extensive retail presence both via company-owned and franchise model. Today, the brand dominates the market in its category with a network of more than 900 kiosks across the country, of which 226 kiosks are franchisee-operated.

Hot biz opportunity for franchisees 

As CDX continues to spread out across India, it is offering lucrative partnership opportunities for interested franchisees wanting to own a Coffee Day Xpress (CDX) kiosk. The brand’s franchise opportunity has proved to be a brilliant business opportunity as it offers a great profit margin. Ramakrishnan informs, “This low investment-high returns business model has proved to be a success with all our 900+ outlets across the country. The simplicity of the model and the promise of the return on investment (ROI) encourage us to open more outlets”. An aspirant franchisee requires an area of 50-100 sq ft in a location that has high footfalls. It is a low-risk investment with lots of advantages. A franchisee is entitled to a well equipped plug-and-play kiosk fully operational within three weeks of the franchise agreement being signed.

Challenges 

However the businesses approach that CDX followed has served the company and its associates well, but there are few challenges to face likely sustain the growth, and competition from domestic players. Ramakrishnan says, “While kiosks are a successful business format there are a few challenges like sustainability, securing a good location and selling the product in style. When selling the product, one should give proper attention to the customer’s demands, while maintaining the quality of the product and focusing on an efficient delivery system”.

Road ahead

In order to sustain rapid growth in the years to come, CDX needs to explore new market opportunities. As per Ramakrishnan, “We are exploring newer and untapped opportunities in tier I markets. We are also expanding our presence and tapping more opportunities in the tier II markets where there is high scope of growth”. The company will target places like malls, hospitals, high street locations, airports, railway stations, corporate etc.

Finally

In India, the ‘take-away’ space is increasing phenomenally in metros. Further, Tier II and Tier III cities are also expected to be where major fast food players are likely to expand aggressively. With this the kiosk format will also grow exponentially. However, for sustainable growth CDX will continue to bring in innovations and improvement in its business system.   

Related: Aroma of profitable biz

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