Landmark Group to open 90 coffee outlets by 2011

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Plans are afoot by Dubai-based Landmark Group to bring a global coffee chain to India. Landmark is in talks with two international coffee chains and is expected to seal a master-franchise agreement with one of them in the next two weeks, said Ravi Saxena, managing director of the company’s hotels, leisure and restaurants businesses in India.

In the next 10 years the company plans to open 500 coffee outlets of the global chain, with plans to invest Rs 40 crore to launch 90 outlets in the first four years. The first outlet is expected to open in Mumbai by February next; this will be followed by a launch in New Delhi in June and Bengaluru after that.

Saxena said India currently has about 1,200 coffee outlets, and that the number would increase to 2,500 in the next four years. He put the business done by these outlets at Rs 500-600 crore. According to him, this number would triple in the next five years.

Given the high real-estate rental cost in India, the company expects to break even only in the fifth year, compared to the global average gestation period of three years for coffee chains, he added.

International coffee brands like Costa and Coffee Bean & Tea Leaf have either opened or are in the process of opening outlets in India, and compete aggressively with local chains such as Barista and Café Coffee Day.

– Bengaluru Bureau

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