Starbucks India targets aggressive expansion despite FY24 losses, declining revenue
Despite a US$9.28M crore loss in FY24, Starbucks India plans rapid expansion with a focus on store formats and product innovation.
INDIA – Starbucks India has revealed plans to aggressively increase its store footprint, even as the company reported a Rs 80 crore (US$9.28M) net loss for the financial year 2024.
The coffee chain currently operates 487 outlets across the country and is prioritizing expansion as a key strategy for future growth.
Sushant Dash, CEO of Starbucks India, confirmed that the brand is committed to investing in new store openings, despite the immediate financial strain such expansion efforts place on the bottom line.
Speaking to The Economic Times, Dash noted that the company will continue to emphasize its core strategies of arabica-based beverages, localized menus, and varied store formats.
India remains a high-priority growth market for Starbucks globally, ranking among the top four international markets. Starbucks India’s approach includes deploying diverse store formats to cater to different customer needs and locations, a method it has consistently followed in recent years.
The leadership change at the global level in September 2024 saw Brian Niccol assume the role of CEO, replacing Laxman Narsimhan, whose tenure from March 2023 ended following disappointing sales results.
However, the company’s strategy in India remains unchanged under the new global leadership.
Starbucks India faces increasing competition in the country’s retail coffee space. UK-based Pret A Manger entered the Indian market in April 2023 through a franchise deal with Reliance Brands Limited, with plans to open 100 stores in five years.
Meanwhile, Indian rival Third Wave Coffee surpassed 100 store locations last year.
Starbucks India’s revenue for FY24 dropped 12% year-on-year to Rs 1,218.1 crore (US$141.28M).
Concurrently, in response to evolving consumer preferences, Starbucks recently launched two new ready-to-drink (RTD) lines in the U.S.—Iced Energy and Frappuccino Lite—targeted at health-conscious customers.
The RTD beverages are available in multiple flavors and are sold at major retail outlets across the United States for US$2.99 each.
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