Starbucks is one of the most famous and iconic coffeehouse chains in the world. Since its inception in 1971, the company has shown continuous growth and today, it operates in more than 30 countries. With its strong brand recognition and loyal customer base, Starbucks has become a popular choice for entrepreneurs looking to set up their own businesses. The cost of Starbucks Franchise in India depends on a variety of factors such as location, size of the store and type of store.
In India, Starbucks has gained tremendous popularity. The company has expanded rapidly in the past few years and currently operates more than 1,000 stores in the country. This has made India one of the most important markets for Starbucks and many entrepreneurs are keen to own a Starbucks Franchise in India.
By setting up a Starbucks Franchise in India, entrepreneurs can benefit immensely. With its strong brand presence and loyal customer base, the store can quickly become a profitable business.
Starbucks Franchise Business Model
To begin with, Starbucks does not follow a traditional franchise model and it becomes pertinent to understand the model it operates on. So, we will now look at the nuances of the business model:
- Starbucks does not allow individuals to take a franchise, however, they can open a licensed coffee store. The authorization for the same is obtained from the firm.
- Starbucks accepts applications to their website to open a Starbucks licensed coffee shop as no person can independently open a Starbucks coffee shop.
This particular business model by Starbucks is introduced in order to maintain store ownership, maintain control over service and product quality. Additionally, the company is able to micro-manage by deciding the menu, store equipment, support, training, on-site visits and more. In this manner, the company assists licensed locations to establish themselves in the Indian market, scale it to a different level and drive growth. The overseeing of essential and critical factors by the company helps exponentially in making Starbucks a pioneer in quality coffee brands.
Procedure To Get a Starbucks Franchise
The process that defines how to get Starbucks franchise in India is as follows:
Step 1: Fill out an Application Form
The first step towards getting a Starbucks franchise is to fill out an application form, which can be found on the official Starbucks website. You will need to provide basic information such as your name, address, contact details and other relevant information.
Step 2: Submit the Application
Once you have filled out the application form, you need to submit it to the Starbucks team. You can either do this online or by mail.
Step 3: Interview
Once the Starbucks team receives your application, they will contact you for an interview. The purpose of this interview is to assess your skills and abilities to run a successful Starbucks franchise.
Step 4: Training
If you are successful in the interview, you will be invited to a training program. This program will help you to understand the operations of a Starbucks store and how to manage it.
Step 5: Agreement
After completing the training, you will be asked to sign an agreement with Starbucks. This agreement will include the terms and conditions of running a Starbucks store.
Space Requirements for Starbucks Franchise in India
Starbucks franchises in India are highly regulated by the country’s Coffee Board. The space requirements for a Starbucks franchise in India depend on the size and type of store. For a standard store, the minimum space requirement is 1000 square feet, with a minimum frontage of 20 feet. The store must also have a separate area for coffee brewing and preparation. The store must also have a seating area, which must be at least 200 square feet and must have a minimum of 30 chairs.
In addition to the space requirements, Starbucks franchises in India must also meet certain other criteria. The store must have an adequate power supply, fire safety measures and a safe and secure environment. The store must also have a register, cash drawer and POS system. The store must also have adequate lighting, ventilation and sanitation.
The store must also comply with all local health, safety and environmental regulations. All food and beverage items must be prepared in a hygienic manner and must be stored in a safe and secure area. The store must also have a designated area for waste disposal.
Finally, Starbucks franchises in India must also adhere to a strict set of brand standards. This includes having a consistent look and feel, using approved materials and ensuring that all food and beverage items meet the company’s stringent quality standards.
Documents Required for Starbucks Franchise in India
Before you can open a Starbucks franchise in India, there are certain documents that you must have. They are:
- A copy of your PAN card. This is important because it establishes your identity as a legitimate business owner.
- A copy of your Aadhar card. This will be used to verify your identity and will also be needed in order to process payments.
- A copy of your business registration certificate. This document will prove that you are legally registered to do business in India.
- A copy of your shop/store lease agreement. This is important as it shows that you have a physical location that you are using to operate your Starbucks franchise.
- A copy of your GST registration certificate. This document is important as it will allow you to charge and collect taxes on sales made at your Starbucks franchise.
- A copy of your food license. This will be needed in order to process the food and beverages that you will be selling at your franchise.
- A copy of your bank statement. This is necessary to prove to Starbucks that you have the funds to sustain a franchise.
These documents are essential to open a Starbucks franchise in India. Make sure to have all of these documents handy before you start your franchise journey.
Financial Costs of Obtaining a Starbucks Franchise in India
The financial costs of obtaining a Starbucks franchise in India can be quite substantial. The initial fee for a Starbucks franchise in India is between Rs. 25 lakhs to Rs. 40 lakhs. This fee covers the cost of the initial setup, training and support, as well as the licensing fees for the Starbucks brand in India. In addition to this fee, the franchisee must have sufficient capital to cover the costs of opening and operating the store. This includes the cost of the building, equipment, supplies, inventory and staffing. In addition, the franchisee must have sufficient capital for marketing and advertising, which can add significantly to the overall cost of the franchise.
The franchisee must also pay a royalty fee to Starbucks, which is typically 6-8% of net sales. This royalty fee helps to cover the cost of the Starbucks brand and its ongoing support and training. The franchisee must also pay an advertising fee, which is typically 4-6% of net sales. This fee helps to cover the cost of advertising and promotional campaigns.
In addition to the initial investment, the franchisee must also pay ongoing expenses such as rent, utilities and staffing costs. The Starbucks franchise price in India can vary significantly depending on the size and location of the store.
Overall, the financial costs of obtaining a Starbucks India franchise can be quite substantial. However, it is possible to minimize costs by carefully researching the market and making sure that all costs are accounted for. With careful planning and a commitment to running a successful business, a Starbucks franchise can be a great investment.
FAQs on Starbucks Franchise Cost in India
You must go through the following Frequently Asked Questions if you are looking to get a Starbucks franchise.
How long does it take to open a Starbucks franchise in India?
It usually takes around 4-6 months to open a Starbucks franchise in India.
What procedure is needed to open a Starbucks franchise in India?
The procedure to open a Starbucks franchise in India involves submitting a franchise application, attending a franchise seminar and submitting a detailed business plan.
What kind of space is required to open a Starbucks franchise in India?
The minimum space requirement for a Starbucks franchise in India is around 2,000-2,500 sq. ft.
Is there any training required to open a Starbucks franchise in India?
Yes, training is required to open a Starbucks franchise in India. The franchisee must attend a franchise seminar and also undergo on-site training at the store.
What documents are required to open a Starbucks franchise in India?
Documents required to open a Starbucks franchise in India include valid identity proof, address proof, business plan, financial statements and franchise agreement.
Starting a Starbucks franchise in India requires a significant investment and a lot of hard work. But with the right procedures and documents in place, you can be sure of a successful venture. So, if you are looking to start a Starbucks franchise in India, make sure to keep the above points in mind.