Starbucks in Surat. BAD IDEA?

On 8th of August world most renowned coffee giant Starbucks opened 2 stores in one of the worlds cleanest, fastest growing city Surat. Surat is a city with a population of over 6 million. It is also the city with highest per capita income in the whole state. Surat has seen dramatic growth in terms of income disposal, Infrastructural development and improvement in lifestyle of locals or so called 'Surti's'. A part of the city has posh residential, high-rises and super cars running down the streets of newly introduced name brand stores and shopping avenues with a perfect corner estate catching attention of all with the name of Starbucks.

And the other one in a commercial estate called 'International Business Center' surrounded by multiple restaurants, right below towns one of the finest office space. Both the stores appear to be on a spot on location with road front stores easily catching eyes. However despite of Surat's dramatic growth, and amazing location of stores will Starbucks manage to survive in the town?

Lets have a look at some of the facts and findings regarding Starbucks in India.

India has over 120 outlets of Starbucks. It is a50:50 joint venture with TATA Global Beverages. Including Surat Starbucks is in 13 other cities of India. Most of which had many similarities. Starbucks have stores in Mumbai (46), Delhi (17), Banglore (19), Pune (11), Gurgaon (7), Kolkata (4), Hydrabad (7), Noida (3), Chennai (8), Chandigarh (2), Ahmedabad (3) and Surat (2).

All of these cities have few if not many common characteristics. All of these cities are densely populated, are either a city with multiple renowned educational institutes or has young crowd, have multiple corporate headquarters or is a corporate hub itself, has institutes providing high paying jobs, has tourism spots in the city or anyhow attracts visitors to the city either with commercial, educational or travelling purposes.

However, Surat does not seem to have any of it! Surat definitely is a Textile and Diamond Hub but all those operations are located in the other side of the city attracting visitors specifically with the sole purpose of business. Surat also highly fails to attract young visitors to the town due to lack of quality educational institutes, tourist places and a major factor 'Liquor Ban'. Surati's also tends to have more of an Entrepreneurial mindset and has no MNC's or jobs with healthy pay-scales. Thus the only target market for Starbucks in Surat is local youth. Since a Rs.350/- Frappe definitely does not fall under a budget coffee or an everyday coffee the potential customer base is further narrowed down. And now this is the point where local competition kicks in. Surat has seen over 100 new cafes in last 5 years. Ranging from Cafes that serve Rs.50/- frappes to the fancy ones serving French Pressed coffees. Meraki Coffee House is one of the towns hot spot for coffee lovers. The place only serves quality coffee and few baked delights and has been peoples favourite since the day it opened up. In fact it has almost 5 Star rating on every food blog. Rumors are that they are expanding with a branch right in front of Starbucks. The local cafe has never seen a day with an empty table and can turn out to be a threat to the global coffee giant at least in Surat.

Starbucks have faced over-saturation of market earlier too and was forced to shut down 150 underperformig outlets just about a year ago. And for a city small as Surat with such strong local competitors opening up 2 stores within 3 kms radius seems like an aggressive move. It has been just one month since Starbucks opened up and the stores have already seen decrease in footfall. With all such odds in the way of making the Premium Coffee Giant sustainable in Surat a question that pops in the head is

"Was it just a Hype? or will Starbucks be a Routine for Surti's?"

I would love to hear upon your opinions on it.