Cafe Coffee Day (CCD), part of Amalgamated Bean Coffee Trading Company, has been planning to cater to Southeast Asia for some time. However, many joint venture deals have failed this has come as a setback to CCD.
The company has been eyeing an entry into Philippines, Malaysia, Vietnam, etc, but the plans have been delayed. Shwetha Shetty, president (international division), said, "We did not want to hurry and make a mistake. We were in talks with foreign players in those countries, but things could not reach a final conclusion in multiple cases. Things have been delayed. As of now, I can only say we are still in the process of expanding internationally."
To increase its presence in the foreign market, CCD was eyeing joint ventures, as it felt local expertise would help it gain a stronger foothold.
Currently, the company has about 16 stores in the Czech Republic and Vienna. The company had acquired a coffee chain in the Czech Republic in 2010 for Rs 15 crore. Though it had forayed into Pakistan in 2006, operations in that country had to be shut due to political instability.
It is being speculated with global coffee chain major Starbucks entering India, CCD would focus more on domestic business, its primary domain. When contacted, K Ramakrishnan, president (marketing) of CCD, said, "We do not navigate our strategies due to others who enter the market. Our core focus has always been the domestic market. Competition is good, as it would enhance the organised market. But we are not changing our plans because of that."
Currently, there are about 2,000 cafes in the organised market; the number of 'mom-and-pop' cafes is 500-600. So, there was high potential in the market, Ramakrishnan said. The youth-oriented retail coffee chain had recently announced it planned to increase the number of its outlets from 1,400 to 2,000 by 2014.
Branding expert N Chandramouli said it was difficult to venture into new territory. "Starbucks has entered India. But it did that after a lot of evaluation. As it is looking to expand in foreign countries, this also applies to CCD. While competition would make the organised market bigger, existing biggies are surely keeping a close watch to maintain leadership," he said.
