INDIA- Grab-and-go coffee chain abCoffee has announced plans to open 150 stores by the end of the current fiscal year, according to its founder, Abhijeet Anand.
The company intends to increase its outlet count from 60 to 150 within the current fiscal period. The new outlets are expected to go beyond major cities like Mumbai, Delhi and Bengaluru, where most of the current outlets are located.
The plans were announced after the coffee chain marauded Bengaluru by opening seven outlets in 24 hours. The founder also revealed the company intends to open 5 more outlets by August 18.
This aggressive expansion strategy is a direct function of abCoffee’s recent success, especially its online delivery wing.
Anand also revealed that the coffee chain enjoys 64% repeat rations on food delivery platforms like Zomato and Swiggy. abCoffee earns 39% of its revenue from online sales, while the remaining 61% is earned from same-store sales.
The move is meant to broaden the on-the-go coffee chain’s reach across India, making its product line more accessible to a wider customer base across a wider geographical area.
The new distribution channels are also expected to make delivery via online platforms more efficient through broadening distribution points.
However, the company revealed it does not intend to franchise any of the planned outlets. abCoffee intends to control all aspects of operations, which should increase margins and revenue. It will implement a uniform operating strategy for all its outlets in India.
Anand revealed the key challenge facing this planned expansion is funding. Although the grab-and-go coffee chain raised US$5.7 million over three funding rounds in the past year, it still requires additional funds to enhance supply chain operations and technology transformation for the new locations.
Anand said, “We are further planning to raise funds in a couple of months to further build our technology stack. We will be improving our supply chain operations along with the consumer interface. We will also be using these funds to acquire the right talent and further push our subscription model.”
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