Tata Consumer Products has firmly denied recent rumors about Starbucks planning to exit India. The report, which alleged that rising losses and high operating costs were forcing the American coffee giant to close operations in the country, has been labeled “baseless” by Tata Consumer Products in letters to three major Indian stock exchanges.
The Origin of the Rumor
On December 19, a Rajasthan-based media outlet, The Philox, published a sensational report titled, “Starbucks to Exit India Due to High Costs, Bad Taste, and Mounting Losses.” The report claimed that Starbucks was struggling to sustain itself in India, where price-conscious consumers often favor affordable local coffee options over premium-priced beverages.
The report suggested that Starbucks’ operational challenges—ranging from high real estate costs to competition from local players—could lead to the brand shutting its doors in the Indian market.
Tata Consumer Products’ Response
Tata Consumer Products, which operates Starbucks in India as part of a joint venture, swiftly addressed the rumors. In their official statement, the company dismissed the claims as unfounded and reassured stakeholders that Starbucks remains committed to its presence in India. The company described the allegations as “baseless” and clarified that the partnership with Starbucks continues to thrive.
Starbucks in India: The Bigger Picture
Since its entry into India in 2012, Starbucks has expanded to over 350 stores across the country, offering a premium coffee experience. While challenges exist, including competition and consumer preferences, the brand has built a loyal customer base, particularly in urban areas.
The joint venture with Tata Consumer Products plays a pivotal role in Starbucks’ India operations, leveraging Tata’s local expertise to navigate the complexities of the Indian market.
