Barista Lavazza is an Italian coffee chain with 200 stores in India. It was established in 2000 as Barista coffee and was later acquired by the Italian coffee company Lavazza in 2007. The chain aims to provide an authentic Italian coffee experience. It faces competition from other coffee chains like Café Coffee Day and Costa Coffee. The case discusses strategies for Barista Lavazza to address problems from its rapid expansion, like poor performance and store location selection, such as consolidating operations, increasing franchising, and cost reduction efforts.

1. Barista Lavazza – Case Study
Presented by Valliappan P, Narahari Sai, Tejaswini

3. Introduction:
• Barista lavazza is a chain of espresso bars in India. Established in february 2000 under the
name Barista, it was taken over by Lavazza in 2007.
• Barista Lavazza chain of espresso bars delivers a truly Italian coffee experience in warm,
friendly and relaxed environment.
• A 34.3% equity stake was sold to Tata Coffee in 2001. C.Sivasankaran bought the remaining 65%
in Barista from the Amit Judge-controlled tuner morrison in 2004 and his sterling group also
bought out tata coffee’s stake later.
• In 2007, the sterling group sold Barista to Lavazza. Barista Lavazza is currently owned by
Lavazza.
• The chain has 200 stores in India, with an estimated annual revenue of 200 crores.
• Barista was the fastest brand to make it on the list of super brands and is ranked among the
top 50 phenomena that changed India

4. History
• BC850 : First known discovery of coffee berries
• 1600 : Coffee enters to Europe through the port of Venice
• 1654 : The first coffee house opens in Italy
• 1750 : One of Europe’s first Coffee house
• 1822 : Prototype of 1st espresso machine is created in France
• 1908 : Invention of the world’s 1st drip coffee maker
• Feb, 2000: First Barista Lavazza at Basant Lok, New Delhi
• Lavazza traces its origins back to 1895, when Luigi Lavazza purchased a little grocery store, Paissa Olivero, in
the old commercial section of Turin for 26,000 Italian Lire, about US$ 20. In the early 1900's, he invented the
concept of the blend - a complex art of mixing together coffee of different origins to obtain a distinctive taste
and harmonious flavour in the cup. Before the turn of the century, the name Lavazza evolved into an
international powerhouse and the unofficial ambassador of Italy, being synonymous with all things Italian -
creativity, art, passion and of course, espresso.

5. Competitors
• Café Coffee Day
• Costa Coffe

6. About the case
• The case is about Barista Coffee Company which is facing problems regarding its performance in India.
• To overcome the hurdles and perform well the new CEO Yogesh Samat proposed some changes/priorities in this case.
• Changes/priorities are:
Change of strategy to consolidation instead of indiscriminate expansion.
Reorganization exercise at the coffee retail chain.
Increase the ratio of mall stores against standalones.
Opting for franchise to expand its operations.
Cost reduction at the operation level.
Including non-coffee beverages and speciality teas.
Change in pricing.
Customizing stores to suit localities
Co-promotions with movies and co-branding.

8. The Problems
Rapid expansion
Poor performance
Lack of focus
Poor selection of store locations
Lack of funds
Exodus of senior management personnel from Marketing and Finance

9. Case Study - Questions
Franchising a good strategy or not?
How do you grow while controlling the costs?