Insight
Chitharanjan: Average cafe customers do not care which estate coffee comes from
“The average customer walking to a cafe doesn't care that this coffee comes from the state ABC.”
Assertion Not checkable as stated
Chitharanjan: Blue Tokai survey shows ₹250 is the consumer price sensitivity threshold
“So we've done a survey and it's two 50 rupees is kind of the, they won't notice anything up until two 50 rupees is above two 50 rupees, then they, then they'll start to pay attention.”
Insight
Chitharanjan: Record coffee bean prices only add 2–3 rupees per cafe cup
“In a coffee shop, even now, coffee prices are at a 50 year high right now. You know, add two, three rupees to the cost of a cup of coffee. So it's very easily absorbed in a coffee shop. In a packet of coffee, it's not very easily absorbed.”
Insight
Chitharanjan: 1,000 sq ft is the optimal coffee shop footprint
“2000, the capex becomes too large to fit it out. And the incremental revenue is not justifying the increase in rent as well. Below 800, then tables become occupied, and people don't want to wait for a coffee shop, though. If they see it's full, they'll just go…”
Opinion
Chitharanjan: Indian coffee machines lag behind Chinese and European rivals
“Quality and consistency is not comparable to the equivalent Chinese or European manufacturers.”
Assertion Not checkable as stated
Blue Tokai co-founder: Coffee growers doubted Indian consumers would pay for specialty coffee
“Even when we went and talked to the growers, they felt that Indian consumers weren't ready to pay for good quality coffee, that you'd have to cut it with Robusta or do a commodity Arabica offering in order to bring the price down so that you could get acceptan…”
Disclosure
Blue Tokai operates at a 400 crore rupee run rate
“We're at a 400 crore run rate.”
Opinion
Matt Chitharanjan: Blue Tokai is mass-premium, while Subko is niche premium
“We, I would say, are more mass premium. They're more niche premium. I think the customers are slightly, I mean, I would say we're more, we try to be more accessible.”
Insight
Matt: Food makes or breaks the success of a specialty coffee shop
“I think food is unfortunately something that's very, I mean, I say this as a copy person, food is something that really makes or breaks the success of the store.”
Disclosure
Blue Tokai: 45% of sales are drinks, 40% are food
“For us, we sell 45% is beverages, 40% is food, and then 15% is the retail packets and bread.”
Assertion Supported
Chitharanjan: India has around 5,000 branded and 5,000 unbranded coffee shops
“There's only around 5000 branded coffee shops and another equivalent amount of unbranded.”
Assertion Not checkable as stated
Blue Tokai: Plant-based milk accounts for only 2% to 3% of sales
“Two, three percent.”
Insight
Chitharanjan: Competing cafe clusters expand foot traffic for all players
“Let's say a third wave coffee opens, a Starbucks coffee opens, a Chaios opens, an independent coffee shop opens, it actually sucks in more people to that market, and everybody does better.”
Opinion
Chitharanjan: International brand status no longer automatically attracts Indian consumers
“I also think that Indian consumers affinity towards international brands is not what it was. 1520 years ago. So the idea that I can just be an international brand and automatically I'll have a line is no longer applicable.”
Insight
Matt Chitharanjan: Building a coffee brand without physical cafes is very difficult
“Without a cafe, it's very difficult to have a coffee brand without a cafe.”
Disclosure
Chitharanjan: Delivery generates 35% of Blue Tokai's revenue
“We're at 35% of the revenue is delivery.”
Insight
Chitharanjan: General restaurants cannot effectively drive specialty coffee discovery
“You rely too much on the person who's brewing it. Yeah. And in most places, coffee is seen as a, okay, I invested in the machine, any random person can make the coffee, they're not gonna put the same care and effort that a coffee shop would.”
Assertion Supported
Blue Tokai operates 135 outlets across India
“If I had to do that, I would replicate it across our 135 outlets, but”
Assertion Partly supported
Starbucks India reached over 1,000 crores in revenue across 97 cities
“I mean, so they've gotten to a thousand plus crores, right, 97 cities, so.”
Disclosure
Blue Tokai spends roughly 4% of revenue on marketing and content
“We, ad spends is one and a half percent.
Then the team would be another three percent or so.”
