After US, China struggles, will Starbucks pay the price in India?

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Subscribe to enjoy similar stories. New Delhi: At 8 am on 7 September, a large, 2,600-sq.ft coffee shop quietly opened its doors in Delhi’s affluent Punjabi Bagh West. At first glance, it seemed like just another café in a neighbourhood dotted with them.

This one, however, marked American coffee giant Starbucks’ latest response to its rivals, who have been on an expansion spree. With the rich aroma of freshly baked croissants and coffee beans being roasted wafting within its bright, inviting interiors, this is Starbucks’ first experiential store. It boasts of a unique menu that fuses locally inspired drinks, such as a Malabar Coconut Cream Latte and a Black Palm Jaggery Cinnamon Latte, with global coffee favourites.

The outlet features more than a dozen coffee blends not available at Starbucks’ other outlets, as well as freshly prepared food, which comprises more than half of its menu. While the right side on each page of that menu will set you back by a pretty penny, underscoring Starbucks’ position as a premium coffee shop for the well-heeled, it may prove to be too much even for some of them. Internationally, Starbucks has seen foot traffic decline, with consumers rejecting its high-priced wares.

Part of the reason customers may choose to go elsewhere is because of the plethora of affordable options, both old and new, that coffee drinkers have today. Starbucks, which has 452 stores in India, has to battle with nearly a dozen other chains, including veterans Cafe Coffee Day (448 stores) and Barista (450). In particular, the Seattle-headquartered company faces stiff competition from rapidly expanding specialty coffee chains such as Blue Tokai (130 cafes) and Third Wave (108), which sell their food and beverages at lower