How many stores are planned by the end of the year?
Our entry into India will represent the brand’s 4th country in the Asia-Pacific region, which already has more than 350 stores. Our launch in India will build on other successful international expansion such as China, Saudi Arabia and the UK.
Tim Hortons will open several stores in New Delhi this year, targeting June-July, quickly followed by Punjab and other parts of the country. For this year, we are aiming to open around 20 stores and then ramp up from year 2.
Are there plans for master franchises or other partnerships in India?
We have the master franchise, and all the stores would be company-owned and company-operated. We do not intend to franchise in India; however, what we do is talk to several groups of people about development partnerships.
Which cities does the brand target?
India is one of the fastest growing markets in the world for specialty coffee retail chains. We aim to open more than 250 outlets over the next five years. This year we plan to launch several stores in New Delhi and then in Punjab. After the north, we will come to the west and then to the rest of the country.
Will the brand introduce different POS formats?
Our first stores will be brand stores, but soon we will also open medium-sized neighborhood stores. We will also adapt to all airport, highway, kiosk and office formats.
What is the USP of the brand? What potential do you see in the Indian coffee segment?
As part of the company’s heritage, heritage and commitment to excellence, we will only use premium 100% Arabica beans for our coffee offerings. In addition to great tasting coffee, we will differentiate ourselves by offering “fresh food” in the coffee shop setup, which will set us apart.
The Indian coffee market is growing at a CAGR of 8-9% year-on-year and is expected to reach over $4.2 billion by 2025, with out-of-home consumption accounting for approximately 20% of the market. Therefore, the market is huge and there is enough room for brands to showcase their experience to their consumers. At Tim Hortons, we serve 100% premium Arabica beans and freshly prepared foods customized to your preferences. Thanks to this, we are sure to make a place for ourselves in the Indian market.
How do you see the business opportunities in India in the segment you cater to and what challenges do you see? What do you think of the competition in this sector?
Research has shown that over the last decade there has been a significant shift in consumers from basic coffee to specialty or premium coffee globally and in India. As I mentioned, the Indian coffee market is expected to grow to over $4.2 billion by 2025, with out-of-home consumption accounting for around 20% of the market.
Moreover, the growing popularity of coffee time and coffee drinking among the young population of urban India has resulted in further growth of coffee chains in the market. The increase in disposable income has removed the mental barrier of individuals when it comes to spending and dining out. Thus, the increase in expenditure for a cup of coffee has exceeded the deterrent to increased costs within coffee chains
With companies creating sub-categories and brands within their own niche sub-segments, there is enough and more space for everyone to grow and give Indians an experience of the culture and heritage that their coffee is associated.