Chai Sutta Bar: A Successful Model in the Tea Café Business in India?
| Case Code: LDEN195 Case Length: 12 Pages Period: 2016- 2023 Pub Date: 2023 Teaching Note: Not Available |
Price: Rs.200 Organization : Chai Sutta Bar Private Limited Industry :Food & Beverage Countries : India Themes: Entrepreneurship |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
The Start of A Journey
Dubey was born in a middle-class family in the Rewa District of Madhya Pradesh in 1996. His father was a real estate businessman. While growing up, Dubey went through various monetary problems. There was a shortage of basic amenities at home which made him realize the importance of money at a very early stage..
The Birth of Chai Sutta Bar
After scouting around for a proper location for many days, both Dubey and Nayak zeroed in on a highly crowded place in Bhanwar Kuwa Street in Indore in July 2016. They opened the shop just opposite a girl’s hostel to target youngsters. They launched this tea shop by investing a collective sum of Rs. 300,000. The teashop was furnished with old furniture bought from a second-hand market and decorated with paintings done by the two friends. Buying second-hand furniture at a low price helped them save money..
Business Model
On the first day of the business, the company offered complimentary tea in a paper cup to attract people. Many people came to the shop but they still needed to become regular customers. This strategy did not work out as expected..
Market Expansion
While expanding its presence to different parts of India, Dubey dreamed of building up a franchise network of CSB outside of India. On January 20, 2020, the founders entered Dubai through their first international franchise. Initially, it was difficult for them to adopt the business style of the country..
Challenges
During the Covid-19 pandemic, CSB went through various challenges, such as financial losses and breakdown of tea experiment team. The pandemic became the toughest period for young entrepreneurs..
Road Ahead
As of 2019, the Indian F&B Industry was worth Rs. 4 trillion. It was expected to reach Rs. 10 trillion by 2025 by showing a CAGR of 16%. Looking at the future growth of the F&B industry, rising income levels, faster urbanization, and changing preferences of customers..
Exhibits
Exhibit I: CSB’s Competitors
Exhibit II: A CSB Outlet
Exhibit III: CSB’s Franchisee Model
Exhibit IV: Requirements of CSB’s Franchisee
Exhibit V: Daily Consumption of Kulhads at CSB from 2016-2023
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