Starbucks slowing down on its expansion pace; Adds just 10 more stores this year
Starbucks slowing down on its expansion pace; Adds just 10 more stores this year

After putting its step on the accelerator to ramp up its presence in the country, it seems like Tata Starbucks Pvt. Ltd., joint venture of Tata Global Beverages Ltd. and Starbucks Crop. has decided to pull-up their horses to cut down its speed. Since the time of its launch in October 2012, the company has opened around 25 stores every year for the first three months. But recently it has been noticed that company has slowed down its expansion plans drastically by opening just 10 new stores.

According to the figures, in June 2015, company had around 74 stores under its belt, year later, it has just managed to add another 10 to its previous total. The numbers include the closure of a couple of stores in Delhi in Lajpat Nagar and South Extension due to the Metro work taking place close by.

To be sure, profitable growth along with new store openings is one of the top priorities for the new chief executive Sumi Ghosh, who came in January from Chicago. The company is far from being even profitable at this point in 2014-15, Tata Starbucks reported a net loss of Rs 42 crore on revenues of Rs171.2 crore.

On the other hand, company has been performing exceptionally well in China where it has opened 2000 stores till now and plans to add another 500 every year for the next five years. As part of its standard course of business, we continually evaluate our business to ensure a healthy store portfolio. We remain committed to the India market and we will continue to work thoughtfully to open stores quickly, said the company in an email on 8 July, adding that it is looking at the long term and taking a disciplined and focused approach to building its brand here. 

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