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May, 01 2006

Local beans to freshen Costa Coffee's cuppa

Costa Coffee, the UK coffee brand that entered India last September, is going to source coffee beans from India to cater to the Middle East-its biggest market outside the UK and Asia Pacific. Costa is likely to finalise the plantation for sourcing within

The company was scouting for a location to set up its roastery in India, which would be its second after south London. Costa, which currently has 12 outlets in the national capital region (NCR), is planning to open its first outlet outside NCR in Mumbai by end of 2006. With their local partner based in Delhi, they decided to first establish and consolidate the brand in NCR and finetune their strategy before going for a pan-India presence.

Costa, which has about 600 stores worldwide, will in another two months announce its plans for China where it set up a representative office a year ago. On Starbucks' planned entry into India, the official of Costa said that the two brands can happily coexist as they do in the UK, the most sophisticated coffee market in the world. They are well differentiated brands, Costa being the high-quality, slow roasted Italian coffee and Starbucks being the high-image American brand. The decision to allow 51 per cent foreign direct investment in single-brand retailing has no bearing on their business model. They have a good local partner and their own management team in India.

On setting up kiosks in India, the company official said that the company will watch out for how the trend of grab-and-go coffee catches on in India. They have alliances with bookstores globally and they would like to have similar alliances in India al well.

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