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India Coffee Retail Chains Products Market Size, Share, & Trends Analysis Report (2023 – 2030)
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Report Overview
The India coffee retail chains market was valued at USD 7.9 billion in 2021 and is expected to grow at a CAGR of 8.0% from 2022 to 2030. The increasing number of coffee retail chains in India is driving the growth of the market. The rising popularity of coffee chains in urban areas has compelled coffee retailers to expand their presence in the country. For instance, Cafe Coffee Day opened 100 new outlets in 2020, taking their total number of outlets to 1,788.
The increasing number of coffee-based products and flavors is further expected to boost the market growth. For instance, Starbucks India launched a new range of cold coffees, Frappuccino Blended Beverages, and a range of Refreshers in 2021. The new range includes flavors such as Mocha, Caramel, and Vanilla. Moreover, the growing demand for specialty coffee is driving the market growth. Specialty coffee is made from high-quality beans that are processed, roasted, and brewed with precision.
Furthermore, the increasing demand for convenience, on-the-go consumption, and healthy options are driving the market growth. Increasing disposable income is another factor driving the market growth. According to the World Bank, the average disposable income of Indians increased from USD 2,715.1 in 2016 to USD 3,274.9 in 2020. The increasing disposable income is enabling people to spend more on coffee and related products.
The increasing trend of digitalization is further driving the market growth. For instance, Starbucks India launched a digital ordering platform, called the Starbucks India App, in 2020. It allows customers to order their favorite beverages and food through their mobile devices and pick them up in-store. Moreover, the increasing number of collaborations between coffee retail chains and e-commerce platforms is driving the market growth. For instance, in 2021, Nestle India partnered with Amazon India to launch its instant coffee brand ‘Nescafé Gold’ on the e-commerce platform.
Product Insights
The food and beverages segment accounted for the highest market share in 2020. This is attributed to the increasing demand for coffee retail chains in the country. According to a survey conducted by the National Sample Survey Office (NSSO) in 2019, India’s retail coffee market was estimated to be worth over Rs. 20,000 crores in 2020. In addition, the increasing number of coffee retail chains across the country is driving the growth of the food and beverages segment. Furthermore, rising consumer preferences for convenience, increasing disposable income, and the presence of several new players in the market are some of the key factors contributing to the growth of the food and beverages segment.
The merchandise segment is anticipated to grow at the fastest CAGR of 8.3% during the forecast period. This growth is attributed to the increasing demand for merchandise products such as mugs, t-shirts, caps, and other items. Furthermore, increasing consumer demand for unique and creative merchandise products is expected to boost the growth of the segment. In addition, the increasing number of partnerships between the coffee retail chains and the merchandise industry is propelling the growth of the segment.
Distribution Channel Insights
The convenience stores segment accounted for the majority of the share in the Indian coffee retail chains market in 2022. The growth of the segment is attributed to the increasing number of convenience stores in the country. According to the India Brand Equity Foundation (IBEF), the convenience store industry in India is expected to reach a market size of INR 5,400 crore by 2024. This growth is mainly driven by the increasing demand for ready-to-eat food options and the growing presence of organized retail stores. Moreover, convenience stores offer a wide range of coffee products from different brands, making them an attractive option for consumers.
The online segment is expected to register the highest CAGR of 17.4% over the forecast period. The growing number of e-commerce players in India is a major factor driving demand for coffee products from online channels. Additionally, the availability of exclusive discounts and offers from e-commerce players are also contributing to the growth of the online segment. Moreover, the convenience of ordering coffee products online is also a major factor driving consumer preference for online channels.
Type Insights
The cafes & bars segment held the largest market share of 33.8% during the forecast period. The increasing presence of café chains such as Starbucks and Café Coffee Day in India is driving the segment growth. The rising number of coffee lovers in India and the growing demand for Italian coffee and tea-based beverages are expected to drive the growth of the segment. Moreover, the emergence of various coffee chains and the increasing demand for special coffee blends are further augmenting the segment growth.
The foodservice segment is expected to register the highest CAGR of 8.4% over the forecast period. The increasing demand for freshly brewed coffee from restaurants, pubs, and other foodservice outlets is driving the segment growth. Furthermore, the demand for specialty coffee blends from foodservice outlets is also expected to drive the growth of the segment. Moreover, the increasing presence of coffee retail chains in India is also projected to fuel the segment growth in the near future.
Regional Insights
India dominated the market and accounted for the largest revenue share of over 34.1% in 2022. This growth can be attributed to the presence of a large number of coffee retail chains in the country. These retail chains offer a variety of coffee products, ranging from traditional to specialty drinks, which are appealing to the Indian population. Furthermore, the rising number of coffee outlets and chains, including Café Coffee Day, Starbucks, and Barista, is expected to drive the market growth.
The Asia Pacific region is expected to witness the fastest growth in the coming years. This growth is primarily due to the rising popularity of coffee shops and franchises in the region. The region is home to several leading players, such as Starbucks, which are investing heavily in the region to expand their presence. For instance, in June 2021, Starbucks opened its first store in Myanmar.
Financial Projections
In this part of the India Coffee Retail Chains Products business plan, we will provide a detailed breakdown of all income and expense categories of the business. These forecasts include cash flow projections and capital requirements for our India Coffee Retail Chains Products business. Usually, these projections are drafted for a 5-year period.
Revenue Assumptions
The main sources of revenues for the India Coffee Retail Chains Products business include the sale of coffee, tea and other beverages, the sale of food items, catering services, and franchising. Other sources of revenue could include the sale of merchandise, online sales, and delivery services.
Projecting Expenses
In this section, all the regular expenses related to keeping the India Coffee Retail Chains Products business running will be described. The list of operating expenses includes rent, wages, advertising, marketing, supplies, utilities, insurance policies, and other costs related to running the business.
Key companies & market share insights
Some of the key companies operating in the India coffee retail chains market are increasingly focusing on product launches and expansion of the distribution channel to gain prominent visibility among consumers. Some of the initiatives are:
– In June 2022, Café Coffee Day opened its 100th store in India.
– In August 2022, Starbucks opened its first store in Mumbai, its first in India.
– In October 2022, Bru World opened its first café in Delhi, marking its entry into the Indian market.
Some of the prominent players in the India coffee retail chains market include:
– Café Coffee Day
– Starbucks
– Costa Coffee
– Bru World
– Coffee Bean & Tea Leaf
– Dunkin’ Donuts
– Barista Coffee
– Second Cup Coffee Co.
– The Coffee Bean & Tea Leaf
– Tchibo Coffee
Global India Coffee Retail Chains Market Segmentation
This report forecasts growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2017 to 2030. For this study, Grand View Research has segmented the global India coffee retail chains market based on product, distribution channel, type, and region:
1. Product Outlook (Revenue, USD Million, 2017 – 2030)
– Brewed Coffee
– Espresso
– Others
2. Distribution Channel Outlook (Revenue, USD Million, 2017 – 2030)
– Specialty Stores
– Online
– Others
3. Type Outlook (Revenue, USD Million, 2017 – 2030)
– Takeaway
– In-Store
4. Regional Outlook (Revenue, USD Million, 2017 – 2030)
– India
– Rest of the World
Frequently Asked Questions
[Q]: What are the Factors Driving the India Coffee Retail Chains Market?
[A]: Factors such as increasing disposable incomes, changing lifestyles, and increasing number of working women are driving the India coffee retail chains market. The growing demand for convenience in India has led to the growth of organized retail segments, which has in turn led to the growth of coffee retail chains. Additionally, the growth of coffee retail chains has been driven by a rising trend of coffee shops in shopping malls and other public places.
[Q]: Who are the Key Players in the India Coffee Retail Chains Market?
[A]: Key players in the India coffee retail chains market include Starbucks Coffee Company, Café Coffee Day, Barista Lavazza, Costa Coffee, Cafe Amazon, and The Coffee Bean & Tea Leaf.
[Q]: What are the Latest Trends in the India Coffee Retail Chains Market?
[A]: The latest trends in the India coffee retail chains market include the introduction of new flavors, growing popularity of cold-brews, and the emergence of third-wave coffee. Additionally, customer loyalty programs and the use of technology to improve customer experience are also gaining traction.
[Q]: What is the Potential of Product Innovation in the India Coffee Retail Chains Market?
[A]: Product innovation has been instrumental in driving the India coffee retail chains market. The introduction of new flavors, the use of technology to customize coffee drinks, and the use of QR codes for ordering have all been sources of product innovation. Additionally, the use of cold-brews, nitro coffee, and other specialty coffees have also been popular sources of product innovation.
Research Methodology
Impact Analytix employs a comprehensive and iterative research methodology focused on minimizing deviance in order to provide the most accurate estimates and forecasts possible. The company utilizes a combination of bottom-up and top-down approaches for segmenting and estimating quantitative aspects of the market. In Addition, a recurring theme prevalent across all our research reports is data triangulation which looks market from three different perspectives. Critical elements of the methodology employed for all our studies include:
Preliminary data mining
Raw market data is obtained and collated on a broad front. Data is continuously filtered to ensure that only validated and authenticated sources are considered. In addition, data is also mined from a host of reports in our repository, as well as a number of reputed paid databases. For a comprehensive understanding of the market, it is essential to understand the complete value chain and in order to facilitate this; we collect data from raw material suppliers, distributors as well as buyers.
Technical issues and trends are obtained from surveys, technical symposia, and trade journals. Technical data is also gathered from an intellectual property perspective, focusing on white space and freedom of movement. Industry dynamics with respect to drivers, restraints, and pricing trends are also gathered. As a result, the material developed contains a wide range of original data that is then further cross-validated and authenticated with published sources.
Statistical model
Our market estimates and forecasts are derived through simulation models. A unique model is created and customized for each study. Gathered information for market dynamics, technology landscape, application development, and pricing trends are fed into the model and analyzed simultaneously. These factors are studied on a comparative basis, and their impact over the forecast period is quantified with the help of correlation, regression, and time series analysis. Market forecasting is performed via a combination of economic tools, technological analysis, industry experience, and domain expertise.
Econometric models are generally used for short-term forecasting, while technological market models are used for long-term forecasting. These are based on an amalgamation of the technology landscape, regulatory frameworks, economic outlook, and business principles. A bottom-up approach to market estimation is preferred, with key regional markets analyzed as separate entities and integration of data to obtain global estimates. This is critical for a deep understanding of the industry as well as ensuring minimal errors. Some of the parameters considered for forecasting include:
Market drivers and restraints, along with their current and expected impact
Raw material scenario and supply v/s price trends
Regulatory scenario and expected developments
Current capacity and expected capacity additions up to 2030
We assign weights to these parameters and quantify their market impact using weighted average analysis, to derive an expected market growth rate.
Primary validation
This is the final step in estimating and forecasting our reports. Exhaustive primary interviews are conducted, face to face as well as over the phone to validate our findings and assumptions used to obtain them. Interviewees are approached from leading companies across the value chain including suppliers, technology providers, domain experts, and buyers so as to ensure a holistic and unbiased picture of the market. These interviews are conducted across the globe, with language barriers overcome with the aid of local staff and interpreters. Primary interviews not only help in data validation but also provide critical insights into the market, current business scenario, and future expectations and enhance the quality of our reports. All our estimates and forecast are verified through exhaustive primary research with Key Industry Participants (KIPs) which typically include:
Market-leading companies
Raw material suppliers
Product distributors
Buyers
The key objectives of primary research are as follows:
To validate our data in terms of accuracy and acceptability
To gain an insight into the current market and future expectations
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