Having slashed the prices of the concoctions it sells by around 15 per cent, the homegrown coffee retail chain Barista claimed that the footfalls in its outlets has increased by 20 per cent over the last six months.
"Besides price cuts, running a lot of in-store promotions all through the year helped. We expect to end the year with net sales of Rs 60 crore (Rs 600 million), an increase of 25 per cent over last year, and average footfalls of 1.2 million a month," said Brotin Banerjee, director (marketing), Barista.
Recently, Barista decided to shut down six outlets -- in cities such as Nagpur and Indore. "Yes we closed down five to six outlets but we opened a dozen new ones and are hiring pretty aggressively. Our competition has closed more outlets than we have," said Banerjee.
According to Barista, it was just an exercise in rationalising the number of stores. "In fact, we are being approached by almost every new mall developer to become one of the anchor tenants and even pick the store location of our choice," Banerjee added.
Tata Coffee, the joint venture partner of Barista, is helping the company with active involvement in management and looking at more opportunities to synergise their operations.
"Tata Coffee's fresh infusion of interest and senior managers has enabled us to negotiate harder with our vendors and beat down the price," said Banerjee.
Renewed interest from Tata Coffee has meant more media buying leverage for Barista. The food served at the outlets is sourced from Taj Hotels.
The company operates over 130 coffee joints including four in Dubai and Colombo. Barista had chalked out aggressive strategies for expansions into Europe and West Asia during former managing director Ravi Deol's tenure.
"We are doing very well in both Sri Lanka and Dubai and we are in talks with a few potential partners in Kuwait," said Banerjee. Barista owns and manages all its outlets in India but operates through franchisees in other countries.
"In Dubai where Barista is located right next to Starbucks, the world's largest coffee chain, the footfalls at the two joints are quite comparable thanks to the presence of a huge expatriate Indian community," added Banerjee.
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