Taking the first step towards entering the Indian market, US-based Starbucks, one of the largest coffeehouse chains in the world, has signed a non-binding memorandum of understanding (MoU) with Tata Coffee Ltd. The MoU will create avenues of collaboration between the two companies for sourcing and roasting high-quality green coffee beans in Tata Coffee’s Coorg facility. In addition, Tata and Starbucks will explore the development of Starbucks retail stores in associated retail outlets and hotels.
Commenting on the announcement, R K Krishnakumar, chairman, Tata Coffee Ltd, said, “We welcome Starbucks in India because of its unique experience with the store format and for its commitment to society, values that we share.”
Calling India one of the most dynamic markets in the world, Howard Schultz, chairman, president and CEO, Starbucks Coffee Company, said, “This MoU is the first step in our entry to India. We are focused on exploring local sourcing and roasting opportunities with the thousands of coffee farmers within the Tata ecosystem.”
Schultz added, “We believe India can be an important source for coffee in the domestic market, as well as across the many regions globally where Starbucks has operations.”
Tata Coffee, one of the largest coffee producing companies in India, has supplied premium coffee beans to Starbucks in the past and is now building a structure for a long-term relationship.
In the areas of sourcing and roasting, Tata Coffee and Starbucks will explore procuring green coffee from Tata Coffee estates and roasting in Tata Coffee’s existing roasting facilities. At a later phase, both Tata Coffee and Starbucks will consider jointly investing in additional facilities and roasting green coffee for export to other markets.
– IndiaRetailing Bureau