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Wednesday, July 20, 2005

Starbucks set to finalize India JVAdd to Clippings

NEW DELHI: Starbucks Coffee Company, the world's biggest coffee retailing chain, is close to naming a joint venture partner to stage an entry into the Indian market.

It has met six potential partners, including the Rahejas, the Kishore Biyani-promoted Pantaloon group and Planet Sports. A top-level team from the Seattle-based Starbucks Coffee Company was in India last week, to talk to potential joint venture partners, sources close to the deal said.

According to sources, the six Indian firms, which met the Starbucks team, have interests in either lifestyle retailing or real estate. Sources also said that the first Starbucks store is likely to be set up in Mumbai, within a time frame of six months. The search for real estate across the country had also begun.

Starbucks did not respond to an e-mail questionnaire from The Times of India. "Though Starbucks has been studying the Indian market for a couple of years, it is now close to firming up plans for India," sources said.

While Starbucks is awaiting the Government's nod on allowing foreign direct investment in the retail sector, sources said the coffee chain was now open to the licensee route as well. "India has huge potential in the food retailing sector. Starbucks is looking to tap that," the sources added.

Though Starbucks is expected to price its offerings at a premium, it will largely compete in the same space as other coffee retailing chains Barista and Cafe Coffee Day. Historically, Starbucks has banked on growth through both a mix of company-owned and franchisee stores.