Rajat Agrawal, chief executive officer of Barista, said the company is planning to increase its presence in Maldives, Bangladesh, Nepal, Myanmar and the Middle East
New Delhi: Barista has overtaken Colombo-based Java Lounge to become the largest coffee chain operator in Sri Lanka, a top executive said.
Barista, the first international chain to enter Sri Lanka in the year 2002, currently operates about two dozen outlets in Sri Lanka compared to around 7 outlets by Java Lounge.
Today, “we are the largest café chain in Sri Lanka with 22 outlets,” Rajat Agrawal, chief executive officer of Barista, told IndiaRetailing in an interview.
Retail and restaurant businesses were hard hit during the pandemic, prompting many such businesses either to fold up or scale down operations as a result. Barista, on the other hand, used the time to consolidate its position in a country like Sri Lanka which was already undergoing a wrenching economic crisis.
“Thanks to the pandemic, we have been able to consolidate our position. Because most others were going down, we were able to (scale) up our inventory,” said Agrawal. Before the crisis hit, Barista operated eight stores in Sri Lanka.
In 2000, Barista launched in India, the largest tea-producing country where drinking tea is a way of life, with the aim to introduce the coffee culture.
In 2002, it opened its first outlet in Sri Lanka’s capital city Colombo. To Barista’s credit, the brand managed to do well in a country that ranks amongst the world’s leading producers of fine coffee. Overall exports from Sri Lanka for coffee, tea and spices were estimated to be $1.1 billion in 2021.
However, over the years, the country did not offer the best of business environments due to its continuous political and economic problems. The country has been struggling with an economic crisis since 2019 marred by unprecedented levels of inflation, near-depletion of foreign exchange reserves, shortage of medical supplies and hike in prices of basic commodities.
Even the negative factors did not deter Barista and the company doubled down its investments in Sri Lanka, Agrawal said.
“We have been the only coffee shop which has tripled the number of stores we had because most others had to shut down because of the economic scenario, making us the largest coffee chain,” he said.
Barista leads by a large margin in comparison with Java Lounge, its closest competitor in the country and the second-largest coffee chain. A venture by the Sri Lankan entrepreneur Dulith Herath, Java Lounge has only around seven outlets across the country whereas Barista is present across all key markets in the country.
Besides Colombo the coffee chain has outlets in Mirissa, Lavinia, Colombo, Cinnoman Gardens, Maharagama, Negombo, Wattala, Katunayake, Southern Highway A, Southern Highway B, Rajagiriya, Thalawathugoda and Sri Jayawardenepura Kotte.
Having strengthened its position, the brand is ready to further expand its footprint in the country. “We’re looking at opening 10 more outlets in Sri Lanka this year. So, we’ll be more than 30 outlets and be far, far ahead of the competition.”
In addition to Sri Lanka, Barista is planning to increase its presence in Maldives, Bangladesh, Nepal, Myanmar and the Middle East.
Over the two decades of lifetime, Barista has changed hands several times. In 2007, Italy’s Lavazza purchased Barista from entrepreneur Sivasankaran and invested almost Rs 240 crore in Barista, including its acquisition cost.
Then in 2014 Carnation Hospitality became the fourth owner of Barista when the New Delhi-based company acquired Barista from Italy’s Lavazza Spa for about Rs 100 crore.
The Tata group had also owned that chain for some time before selling it to Sivasankaran. Currently, Barista is in the hands of Boutonniere Hospitality Pvt. Ltd.
