Sipping wine or guzzling beer may soon be possible in the neighbourhood coffee shop. The coffee chain Barista Lavazza has inked a deal with Nasik- based Sula Wines and Australian brewer Foster’s to uncork their products in select Barista outlets in the country.
Sanjay Coutinho, COO Barista Lavazza, said that the select outlets in Bangalore and Mumbai will serve wine and beer by March 2010. Currently, only one outlet in Delhi serves these beverages. The firm plans to add 25 more outlets in the near future.
“The licence fee is very high in Mumbai and Bangalore (around Rs 35 lakh), whereas in Delhi, it is far more affordable (around Rs 10-12 lakh). Also, the city shutting down early are the other hurdles faced by the firm," he added.
Recession has proved beneficial for the coffee chain which saw around 15% of the customers of five star restraunts walking into the outlets, thereby compensating for any drop in the regular customers. Barista Lavazza clocked revenues of Rs 150 crore in 2008 calendar year (CY) and is looking at around Rs 225 crore in CY09. For the next year, they have a target of Rs 300 crore. It currently enjoys 25% of the coffee chain retail market in India.
September also saw Barista Lavazza signing pan-India deals with oil firms -HPCL, IOCL and BPCL, since the firm plans to open up more outlets on the Indian highways in 2010.
They have marked the highways of Bangalore- Hosur, Delhi Chandigarh, Delhi-Mathura, Delhi-Shimla and Bangalore-Mysore for opening standalone cafes as well as those along with the gas stations.
Once the manufacturing capacity at their Siruseri plant becomes functional the firm plans to introduce coffee capsules on a larger scale in India. These capsules provide a shot of coffee when inserted in the vending machines. Currently, they have to be imported and the consumer pays Rs 25 per capsule. Coutinho added that with manufacturing the capsules in India, the cost could come down to Rs 8 per capsule for the consumer.
Lavazza is also exploring opportunities in Nepal and China. Currently, they have outlets in Sri Lanka, the Middle East and Bangladesh. It has tied up with Shatabdi Express to serve ice cream under Barista banner.
The COO added that the dip in coffee production has resulted in expenses shooting up by 70%.
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