cafe Coffee Day, which runs 157 cafes across the country, promises that a 'lot can happen over coffee'. Well, a lot is certainly brewing in the coffee bar business. Sellouts, expansion plans, buzz about the possible entry of big international players like the US-based Starbucks...the market seems poised to make an evolutionary leap. What's more, the coffee bars as you know them are in for a complete makeover. So grab that hot steaming cup and brace up for the action.
The bitter truth is that since 1996, when the first outlet opened in Bangalore, the business has been more hyped than happening. In fact, none of the leading players are making money, although individual coffee bars may be profitable and the mark-up on every cup of coffee is a whopping 70 per cent. Admits Naresh Malhotra, CEO, Cafe Coffee Day, "Location, and not coffee, still drives business." What he means is that the outlets have to be in prime locations, where real estate is expensive. Add infrastructure costs and the setting up of a single cafe can cost a company nearly Rs 25 lakh. Obviously, you can't...
