Barista Coffee Company Limited

(Decision Sheet – Group A11)

ANALYSIS

a. Issues: a. Alternatives:
• Increasing competition – CCD, • Pricing structure
Starbucks, Qwicky’s Premium pricing or
• Deciding on the current pricing Affordability
structure Differentiated pricing
• Deciding the best product-mix • Expansion
strategy Franchisee model
• Expansion and growth Company-owned outlets
• Expansion in overseas market Overseas markets
• Focus on backend operation to reduce
O/H and material cost

a. STP:
• Segmentation:

Geographic: South India or North India

Product category wise: Instant or filter
Demographics:
Age wise: <20Yrs (23%) or 20-35 Yrs (46%) : Intellectuals/ Business Execs.
 Time of the day: Students: first half of the day or Executives: early
afternoon/evening or Families: late evening/night
• Targeting:
Youngsters and adults (69%)
Business Professionals as a place for
Business meetings

• Positioning:
FINE CAFE- premium and
predominantly experiential

DECISION:
• Differential pricing
Different types of stores
Different locations (Ist and IInd tier cities)
Standalone coffee shops: premium placed products (up to $5 a cup)
 Coffee kiosks - Quick service, Affordable pricing (up to 50c-$1 per cup),
Lesser food items
Uniform pricing in a city or close-connected towns - Avoid a perception of lack of
consistency
• Expansion in South India
Franchisee model of growth for coffee kiosk
Company owned stand-alone stores at premium location in metro-cities
Less capital required
More focus on coffee based products
More focus on 20% of the sale items that provide 80% of revenue
• Include foods and other offerings at stand alone stores in North India
Less coffee consumption (1 cup per capita)
• Come-up with ideas like “Ban-Café’ (tie-up with ABN Amro) and implement shop-in-shop
stores
• Overseas expansion
Running in significant losses (Rs. 214 million in 2003 and Rs. 75.9 million in 2002)
 Higher competition with established players like Starbuck
Not suggested to go for overseas expansion
• Advertising
Present mode: word-of-mouth advertisements
Suggested to go for advertisements through banners, bill-boards etc. in places with
the target segment