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"Coffee should be black as hell,
strong as death, and sweet as love."
Coffee retail in India is more vibrant now than ever with cafes and boutique coffee shops popping up in malls and high street markets. While Starbucks has already been around for some time in India, Canadian coffee chain - Tim Hortons is the latest entrant. Coffee startups too are becoming more and more visible. While it certainly is the heyday for branded coffee in India, the country's coffee legacy goes back in time.
The gift of Turkey to the world, coffee made its way to India back in 1670 when Baba Budan, a Sufi brought raw coffee beans from the port of Mocha, Yemen while returning from Hajj and planted them on Indian soil. Revered as he was for his wisdom, Budan's shrine stands at Chikkamaggaluru in Karnataka. Two hundred years after that, with the intervention of British entrepreneurs, coffee started being grown as a commercial crop, spread over 40 estates including the Nilgiris Biosphere. With coffee cultivation growing rapidly, soon the Indian Coffee Board was formed to help facilitate research, marketing, and distribution of coffee plants to the indigenous communities.
The Nilgiri coffee farmers grow Robusta and Arabica - the plantations grown at 3500 ft above sea level. Coffee saplings grow under the shades of big trees and are often inter-cropped with millets and spices. Coffee is largely grown with organic manure in India. The Coffee Board offers support to coffee growers by helping them with machines for pulping beans and other amenities. It is common to see coffee parchment or beans drying on the rooftops of rural sites of the coffee growing states of India. Sometimes beans are roasted in the front yards of houses. Community farmers sell coffee in various forms - coffee parchment, cherries, dried cherries and green beans. During 2021-22, India produced 34.2 million kilogram of coffee shows data by the Coffee Board of India. Also, Indians in FY22 drank 10 million kilogram of coffee. Currently, around 65-70 per cent of coffee produced in India is exported to Italy, Germany, Belgium, and the Russian Federation, Libya, Poland, Jordan, Malaysia, the US, Slovenia, and Australia. Coffee drinking in India however has a pre-Independence history.
The Indian Coffee House chain came to be formed in the 1890s and its first outlet was opened in 1936 in Mumbai. By 1940s, there were 50 coffee houses all over British India. The coffee houses typically were considered social spaces for fostering intellectual conversations. The Calcutta Coffee House, in particular, has traditionally been a spot for filmmakers, theatre personalities, and members of academia to meet and converse. Despite the proliferation of the modern-day coffee shops, the College Street Coffee House continues to be a big draw among young college goers of the city. The Indian Coffee House in other metros too have their own rich heritage.
The branded coffee shops are an American export to the world but the Americans themselves too were originally tea drinkers. The Americans imbibed coffee into their lives and churned it out to the world with Starbucks.
The widespread love for coffee in the United States of America started as an act of rebellion. On December 16, 1773, the Sons of Liberty, a group of merchants and tradesmen founded to protest British taxation, disguised themselves as Native Americans, boarded docked ships and threw 342 chests of tea into the Boston Harbor to protest against the tea tax. Famously known as The Boston Tea Party. The event sealed coffee's fate in America, and drinking tea was no more considered patriotic. The lines were drawn - Britain was now a tea drinker's country and America a country of coffee-drinkers.
Jerry Baldwin, Gordon Bowker and Zev Siegl opened the first Starbucks store in 1971 near the historic Pike Place Market in Seattle. The founding trio of Starbucks belonged to academia and they loved their coffee. They opened their first store in Seattle named after the first mate in Moby Dick
Two decades ago, with the launch of Barista in the year 2000, café culture formally set foot in India. Then, it was more of a luxury. Mostly set in up-market locations, people started dating over coffee, networking over coffee, and eventually doing business over coffee. The Barista story has grown manifold over the last two decades. Barista is now poised for a rapid expansion into the B-Towns. “Coffee as an industry is growing at around nine per cent per year and we see that many people now want to ride this growth story. It has been around seven or eight years since coffee shops started growing faster than before across India. The coffee story is fast emerging in tier-two cities where an appetite for coffee seems to be growing. We are currently at almost about 325 stores in around 100 cities and we plan to grow to around 500 stores in the next two years,” Rajat Agrawal, CEO, Barista told Business Today.
Among the new entrants to the Indian coffee scene is the Canadian coffee and baked goods chain Tim Hortons which has plans to open 120 stores over three years in India with an investment of Rs 240 crore. According to Navin Gurnaney, CEO of Tim Hortons, the Indian coffee market is expected to reach over $4.2 billion in size by 2025, with out-of-home consumption accounting for about 20 per cent. Tata Starbucks - a 50:50 JV between Tata Consumer Products and American coffee chain has launched 50 new stores in FY22, the highest ever in a year for the company. The market is also flush with coffee and coffee-related startups like Blue Tokai, Sleepy Owl, SLAY Coffee, Rage Coffee, Third Wave Coffee, Beanly, and Country Bean. There's a wide range on the offer too - ground coffee powder, roasted coffee beans, cold coffee, pour-over coffee, hot brew bags, and more.
While coffee guzzling is fast picking up in India, the primary reason for which coffee shops are thriving could indeed be the space the shops offer for conversation. “The coffee shops are becoming profitable because of the increasing purchasing power of the Indians who can now easily afford a coffee in the range of Rs 200-300. This gives a decent profit margin to the investors which was not possible say 20 years ago. Further, coffee shops are going to thrive in India because there is a need for a sort of clean, hygienic space that a coffee shop offers people to meet, connect, and converse. What drives sales in coffee shops in India is food. Indians like to binge at any time of the day and coffee shops are expanding their food menus. Expansion is also easy at this time as coffee shops are also foraying into new spaces like office cafeterias and highway roadside diners,” Arvind Singhal, Chairman, and MD, Technopak Advisors told Business Today.
The Indian coffee boom has just begun.
