The Swiss food and beverage giant has is seeking grow its share in India’s fast-growing retail packaged coffee market, a move which could step up competition with Tata Consumer Products
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Nestlé has distributed Starbucks-branded retail packaged coffee, pods and RTD products since 2018 | Photo credit: Starbucks
Nestlé is exploring opportunities to launch Starbucks-branded retail coffee products in India as part its Global Coffee Alliance with the US coffee giant.
According to Axel Touzet, head of Nestlé’s Coffee Strategic Business Unit, the group was seeking to expand its coffee portfolio in India to “target different coffee consumption moments” as an increasing number of consumers in the country “make coffee their favourite beverage.”
“We see tremendous potential for growth of coffee in India. The more we make progress in terms of household penetration and the more consumers acquire the coffee habit, the bigger the coffee business will become in the country,” he told Indian financial newspaper, Mint.
Signed in 2018, the Global Coffee Alliance deal grants Nestlé exclusive global rights to market and distribute Starbucks-branded retail packaged coffee, pods and ready-to-drink (RTD) products outside of Starbucks’ retail stores, which in India are licensed by Tata Group subsidiary, Tata Starbucks.
A move to launch Starbucks-branded retail coffee products in India will bring Nestlé into closer competition with Tata Group subsidiary Tata Consumer Products, which currently supplies coffee for all espressos sold in Starbucks’ Indian outlets and also produces the Eight O’Clock Coffee, Tata Coffee Grand and Sonnets by Tata Coffee retail packaged coffee brands.
Nestlé, which currently sells Nescafé products in India, has been steadily investing in expanding its product portfolio and production facilities in the country in a bid to gain greater household penetration and tap into rising coffee consumption among India’s growing middle class.
In September 2022, the food and beverage giant announced it would invest Rs 5,000 Cr ($613m) in India by 2025 and highlighted India as one of its fastest-growing coffee markets globally the following May.
In April 2024, Nestlé unveiled plans to launch its Nespresso coffee pod business in the country and is expected to open its first Nespresso boutique in New Delhi in 2025.
Any launch would stand separately from Tata Starbucks’ coffee shop portfolio, at which consumers can already purchase Starbucks-branded packaged coffee. The US coffee chain launched in India in 2012 as part of its joint venture with Tata Group and currently operates 473 Tata Starbucks outlets across 70 Indian cities.