Redefining Starbucks' Legacy, one cup at a time: Global CEO Laxman Narasimhan's ambitious India plans

“What it does is it gives us growth of 5% in the long term, double-digit revenue growth, and earnings growth in the 50% plus range. All that put together helps us in a creative financial result. While doing so, we meet the needs of all the stakeholders: we have partners, customers, the farmers and coffee, the community, as well as the environment,” he says. Starbucks’ India business has already crossed the ₹1,000 crore revenue milestone through just 390 stores.

Ramping up this store count is definitely on the agenda, and it’s an aggressive agenda. “I'm really excited by India and what is happening here… the country is poised for take-off. If you look at last year, we opened one store every five days; we're now moving to one store every three days,” he says. But Narasimhan wants more. His question: “What are we now doing for the other two days?”

The answer: a deeper and wider offering, products designed to cater to Indian taste buds and Indian aspirations, and taking the taste and flavours of India to the rest of the world. “We're working on things that are accessible, the Picco price point, and the filter coffee. And so all that's just for India,” he says, and with a smile adds, “We're going to have, early this year here in India, the Starbucks Reserve Monsooned Malabar. That's a tremendous plan. I bragged about it actually the other day: this is going to be in all US stores in the middle of the year.”

This will mean building a stronger back-end, one powered by digitisation and even artificial intelligence (AI) to iron out any kinks in the supply chain systems. His team is already working with partner Tata Coffee on this. The focus will be on coffee, of course -- the quality, working with over half a million farmer partners to enhance output while taking these knowledge points to two million farmers more and get a gulp of India’s sizeable tea-drinking population.

Narasimhan is adamant that high-growth, under-penetrated markets like India will be the third stool the company sits pretty on, and he’s in for the long haul. “We have a very long-term view to investments and returns. What we know we're doing is we're creating a third leg of the stool in our global markets… We will invest and you can expect in India that we will invest.”

This will dovetail with his plans to make India’s contribution to the iconic American brand’s global growth more meaningful. While the USA still contributes the lion’s share of Starbucks’ revenues, China, at a little less than 10% is growing. But Narasimhan wants more from the 86 other markets the Starbucks Siren has begun to be heard and seen in.

“You have got to recognise the potential of the headroom we have in all of them as we build out this third leg of the stool. In terms of stores, India is at about 400 stores, but we have 38,000 stores globally. Our plan is to get to 55,000 stores over the course of the next five years, with three out of the four stores being outside of the US -- India will also have a big role in this,” he says.