By the end of this year, Bangalore-based Amalgamated Bean Coffee Trading Company Limited would have reinvented itself, from a conglomerate that grows, sources and exports coffee, to one that consumes it in increasing quantities.
Spurring this change is its Cafe Coffee Day chain which has 80 outlets that it hopes to multiply into 200 by year-end.
Director Naresh Malhotra is upbeat because coffee exports have been looking up and international coffee prices have been escalating.
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But that isn't the reason why the company is hoping to increase from a Rs 200-crore turnover to a whopping Rs 650 crore by March 2004, piggybacking on the growth of its retail cafes, vends, takeaways and stores.
A growth that Barista CEO Ravi Deol finds untenable on account of Cafe Coffee Day's location and pricing.
"It's not easy to take away the leadership position from us," he says, "because it exists in the minds of consumers, not in numbers."
Pointing that many Coffee Day locations are in non-profit centres, such as at petrol stations, he says: "Whenever they have located a coffee shop next to ours, the average size of my cheque has gone up, while each of their stores is bleeding."
Malhotra, on the other hand, points out that since December 2003, Cafe Coffee Day has turned into a profitable business. "Our USP is value for money."
At approximately 30-40 per cent less than Barista prices, it hopes to attract the young -- "Coffee is addictive," he points out -- by aggressively pushing the brand at upstream locations as well as within college campuses.
Already, with a monthly billing of Rs 6-7 crore, and with new cafes being added roughly every third day, "Cafe Coffee Day could become the our most significant division, overtaking exports".
Malhotra's game-plan is to penetrate even small towns such as Belgaum, Hubli, Coimbatore, Meerut and Darjeeling, with a mixed offering of Cafe Coffee Day coffee shops at the top end, Coffee Day Express takeaways with coffee priced at around Rs 10, and vending machines where a cup will be sold for a mere Rs 4.
In all, Malhotra reckons they will have 700 Express takeaways and 10,000 coffee vends. In addition, it already has 306 coffee retail stores (360 are proposed by March) where coffee drinkers can choose their own coffee beans and create personalised blends.
Malhotra points to a Barista Happy Hours promotion in Mumbai as an indication of the brand outpricing itself in the market, and says Mumbai is one city where he would be happy to increase the target of 50 Cafe Coffee Days to 100 "to make it a neighbourhood cafe. In fact, we would like to be leaders in every market other than Delhi, where we would leave that position to Barista."
Barista's Deol says more players mean more segmentation, but his view is that with its pricing and growth pattern, it is Coke's Georgia coffee and tea vends that Coffee Day is taking on, rather than Barista.
"The more they move into vending spaces, the more they move away from experiential spaces." "Unlike Barista," rebuts Coffee Day's Malhotra, "we have with long-term plans and are not here to sell our business for profit."
With Starbucks' entry imminent, the last word hasn't been said on the coffee spat yet. Clearly, there's a battle for the market brewing under all that froth, which can only mean happy days for the frequent coffee shop consumer.