Pizza Hut is subtly moving into the coffee market in India

It has been half a year since the fast-food giant that is McDonald’s moved into the coffee market in India and now a rival brand is making similar steps.

Hut Café, the coffee retail arm of Pizza Hut, will be opening up restaurants in Kolkata and Chennai and according to Niren Chaudhary, the President of Yum! Restaurants India, the step will be positively disrupting for consumers and force them to reimagine just what exactly Pizza Hut can offer.

There was a similar period of adjustment when McDonald’s shifted into the breakfast market and placed a strong emphasis on the coffee part of their business.

After testing the model in the past couple of months Yum, the parent company of Pizza Hut, will be up-scaling in the near future with, according to reports, a further ten Hut Café’s to open up by the climax of 2014.

As McDonald’s and Starbucks have shown, expanding your operating hours by offering different menu items – coffee and breakfast for the predominantly fast-food outfit and sandwiches, and soon, alcohol, for the coffee chain – wields healthy profits, and Pizza Hut are following them down that path in India.

While traditional coffee players have found going tough in recent months in India – Barista Lavazza and Costa have seen operations take a hit – coffee is seen as promising area for growth; the market in India is growing at around 15% per year. According to retail consultancy firm Technopak Advisors, the sheer size of India’s largest cities could easily accommodate a further 2,000 cafes each over the next few years. The land is there to be fought over.

Current market-leaders Café Coffee Day has over 1,500 outlets in India and they are expecting to add another 500 stores to their portfolio in the next twelve months, encompassing a further 200 cities across the country.