Today Coffee has become a lifestyle.

Also, it has caught the fancy of today's generation -

youth. These were not the typical coffee drinking target customers. But now they are a big
part of the target base for coffeehouses. And it is fashionable to be seen at the Coffee Pubs. It
is in a way, a lifestyle statement. That is bad news for tea - still the favourite brew for a
majority of Indians, which has been losing out to coffee in recent years. India is one of the
world's largest exporters of tea and also one of its biggest consumers. But it is coffee drinking
which is increasingly becoming a statement of young and upwardly mobile Indians. And
coffee bars, an unheard of concept till a couple of years ago, are suddenly big business.
Corner bars like these are offering more than just coffee and snacks to their customers. For
many of their regular patrons, a visit to these bars is also a part of the western lifestyle they so
much want to identify with. The Coffee retailing sector in India is booming today, with
several companies active in the market. Some are local entities, some have come from abroad
and have tied up with local companies, and some seem to prepare themselves for an entry
sooner or later. The market growth is expected to be 20 to 30% annually in the next couple of
years. Café Coffee Day (CCD) pioneered the café concept in India in 1996 by opening its
first café at Brigade Road in Bangalore. Till about the late 1990’s coffee drinking in India
was restricted to the intellectual, the South Indian traditionalist and the five star coffee shop
visitor. As the pure (as opposed to instant coffee) coffee café culture in neighbouring
international markets grew, the need for a relaxed and fun “hangout” for the emerging urban
youth in the country was clearly seen.

Gro

The coffee market in India has been growing due to the demand for Ready to Drinkcoffee and
has become a part of an individual’s daily consumption basket. Due tochanging cultures,
consumers are becoming aware of domestic and foreign brands, whichare boosting the
consumption levels. The export promotion schemes and other subsidies by the Government
of India, and increasing trend of eating out couples with the rising share of young population
has driven the market.

Growth of the Café Industry in India

The coffee market in India has been growing due to the demand for Ready to Drinkcoffee and
has become a part of an individual’s daily consumption basket. Due tochanging cultures,
consumers are becoming aware of domestic and foreign brands, whichare boosting the
consumption levels.The export promotion schemes and other subsidies by the GOI, and
increasing trend ofeating out coupled with the rising share of young population has driven the
market.
 
Well-established coffee shop chains, such as Cafe Coffee Day (CCD) and Barista,enhanced
their pan-India presence in the latter part of the review period. In 2010, CafeCoffee Day and
Barista had 970 and 200 stores, respectively, and they aim to continueexpanding in the next
few years. Meanwhile, several relatively new players, such asCosta Coffee, Coffee Bean,
Gloria Jean’s and Java Coffee, are trying to establish a

footing in Indian coffee retailing. Both these factors drove on-trade consumption of
freshcoffee beans in 2010, with volumes growing by 12%. On-trade sales have emerged as
theprimary sales channel for fresh coffee beans, in the absence of any appreciable off-
tradeconsumption.In 2010, the average bill amount at coffee outlet was between rupees 135
and 150. This isexpected to rise to rupees 245 by 2016. With customers paying significant
amount fortheir coffees, they are also expecting a lot from an outlet. Factors such as
menu,ambience, service and brand name are playing an important role while choosing a
coffeeoutlet.Indian Coffee Chains market is quite mature which is evident from the fact that
CaféCoffee Day alone maintains more than 1000 Café’s in 141 cities in India. This forms
themain focus of this project