Using a thela, Gloria Jean’s takes coffee war to the street

At Rs 55 a hot cuppa, it is outpriced by competition — roadside stalls, essentially — by a factor of five or more, but in terms of reaching out to customers, Gloria Jean’s Coffees, the Australian chain, is sure taking rapid strides.

The company will roll out its first coffee cart at the Kala Ghoda junction in south Mumbai, which will be followed by similar carts at
key city streets in Bangalore, Pune and Delhi.

It’s a daring brand positioning considering where the chain stands now compared with the ubiquitous tea stalls abounding Indian streets, but essentially, it’s an unusual revenue expansion gambit.

Tony White, regional general manager of Gloria Jean’s, said the mobile carts will have coffee machines attached to be able to offer buyers freshly made brew on-the-go.

“These carts can be moved around within the city and also transported across the country. They will be imported and will cost Rs 25 lakh excluding machine expenses,” he said.

Gloria Jean’s will also peg tent on highways, but customers will be served only pastas and sandwiches at such outlets — along with coffee, of course.

White said the company doesn’t serve food that requires frying and cooking because the coffee beans would absorb their aroma, “which would dilute the taste”. The chain is expanding its pan-India footprint.

It plans to roll out 100 coffee shops by 2013 with an investment of Rs 50 crore. Gloria Jean’s Coffees has a tie-up with the Landmark Group and currently has around nine outlets.

Besides metros, the expansion will target tier-II cities such as Mysore, Kochi, Thiruvananthapuram, Lucknow, Kanpur and the National Capital Region.

The outlets would be in shop-in-shop formats, standalone cafes and kiosks. Each outlet would be built on a 1,500 sq ft area with an investment of around Rs 50 lakh.

Gloria Jean’s hopes to clock a turnover of Rs 6 crore this fiscal and is looking at a 25% year-on-year growth. But irregular rains are proving to be a dampener.

“That has increased procurement costs of our coffee in India,” said White. India is the only market where Gloria Jean’s has its own roasting units because of high import duties, while in the rest of the 37 nations where it has outlets the coffee is imported from Australia.