Global Coffee Report

A NEW CULTURE TAKES ROOT IN INDIA.COFFEE HAS A LONG HISTORY IN INDIA. COFFEE HAS A LONG HISTORY IN INDIA, BUT IT IS ONLY IN THE PAST DECADE THAT MUCH OF THE POPULATION HAS BEGUN TO EMBRACE IT. BAYAR’S IS ONE LOCAL ROASTER THAT IS BEST PLACED TO CAPITALISE ON THIS DEVELOPMENT.

As one of the world’s most populous nations, and with a long-running coffee growing heritage yet a relatively immature domestic coffee market, India exhibits some of the greatest potential for development as a coffee market of any of its Asian neighbours.

While the people from India’s coffee-growing regions in the country’s south have long enjoyed coffee as a traditional part of their day, it is only in recent years that the rest of the nation’s 1.25 billion people have started to embrace it.

As the domestic market for coffee has expanded over the past decade or so, so too have the opportunities for India’s long-established coffee businesses.

With a coffee roasting heritage that began in Bangalore in 1974, Bayar’s is one such Indian roaster that has been perfectly placed to capitalise on the growth of coffee’s popularity in their home market. Now run by the second generation of the Rao family, Bayar’s has made a name for itself as a supplier of coffee to supermarkets, hotels, restaurants and coffee shops throughout India and also to international customers such as Dunkin Donuts, Au Bon Pain, Costa Coffee and Di Bella Coffee.

The company services the Indian market with its range of 18 speciality products that encompass the Excelsia Blend, which is made from 100 per cent Arabica Beans for the café segment, and the Bayar’s Supreme and Bayar’s Gold Blends for the filtered coffee segment.

But it is just in the past ten years that Bayar’s has started to really see lucrative opportunities emerge in their home market, says the company’s Director, Srikanth Rao.

“The Indian coffee market is predominantly concentrated in southern India, which is referred as the traditional market,” Rao tells Global Coffee Report. “In fact, 70 per cent of the total Indian consumption comes from four states in southern India, where filtered coffee is the most popular beverage – prepared using a thick coffee brew mixed with milk and sugar.”

Rao’s father, Ramachandra Rao, began the family’s journey into the coffee business as an extension of his grocery business, with the intention of providing high quality coffee to the local market. Over the decades, the business grew to cater to international customers. But now that the rest of India has started to embrace a global coffee culture, Rao says the company is focused once more on the opportunities in its home market.

“Thanks to the increase in disposable income of the young Indians and the entry of Indian and global café brands, there has been a significant rise in the consumption of coffee. The growth in consumption is higher in the non-traditional markets like north and west India, where consumers are now enjoying various choices of coffee, like the espresso, latte, flat white, etcetera.”

Taking this growth of the domestic coffee market as their cue, Rao says that Bayar’s coffee is poised to play a significant role in this emerging market both in the offline and online segments.

“Bayar’s coffee believes innovation is the key to align with changing market demands and customer preferences,” Rao tells GCR. “Going by the emerging trends in coffee culture, Bayar’s coffee is embarking on specialty blends, single serve coffee systems, providing coffee accessories, creating trained resources in the coffee brewing and coffee tasting skills.”

However, while the growth of coffee culture in India presents a huge opportunity for companies such as Bayar’s, it also comes with challenges as they try to educate a whole new market about their products. “The biggest challenge in the Indian coffee industry is to sustain and build on the momentum and the growth which has been created by the cafés and other coffee formats. The narrative of coffee as a beverage of the young and glamorous has to be maintained and taken to the next level,” Rao says. “This presents two key focus areas: firstly, the sustained focus on quality and enrichment of customer experience. Bad quality coffee will drive the customers away. Secondly, the customer and other stakeholders have to be educated about the various aspects of coffee like proper brewing, identifying and appreciating good quality coffee.” Bayar’s wants to play a key role in this tough and time consuming initiative by training and employing qualified coffee professionals to help drive the growing professionalism of the industry.

While the emergence of café culture has driven Indians’ embrace of coffee as a beverage, this has now translated into the growing popularity of coffee in other formats as well.

“Vending machines that offer different types of coffee at a touch of a button are particularly favoured by the office segment and that has increased consumption of coffee,” Rao says. “In the home segment, customer expectations and awareness have increased. While the traditional coffee consumer has been loyal to the south Indian filter coffee, the young and upwardly mobile cosmopolitan consumer is far more discerning and adventurous, trying unique blends with different brewing methods with a desire for flavours, freshness and quality. This remarkable shift in the coffee business offers every coffee stakeholder an opportunity to expand product lines.”

In order to capitalise on this, Rao says that Bayar’s will move to expand its offering over the coming years.

“Bayar’s strength is in roasted and ground coffee manufacturing,” Rao says. “[However] increased production capabilities, international quality compliances, bringing out specialty and single serve coffee systems and going online are some of the future plans of Bayar’s coffee. The off-shoot of these plans will lead to creating exciting and sustainable blends in line with the growing and emerging market needs for both the domestic and export market segments.”

As such, the company is now focused on new product development and embracing new technologies and formats to take their coffee to a wider audience.

“With the world embracing e-commerce, Bayar’s coffee will be available to its customers across the world by a click of the button in the near future,” Rao says.

He adds that this will also include a growing focus on developing the company’s capabilities in the area of compliance with the regulatory requirements of major export markets, such as the US’s overhaul of its food safety system that is happening at the moment. Bayar’s sources the majority of its coffee from the Western Ghats region of India.

It is this focus on quality and innovation that earned Bayar’s the title of Best Roaster in India from the Coffee Board of India in 2014 and 2016. While the company predominantly sources its coffees from the high altitude growing regions in the Western Ghats mountain range in southern India, they also do some blends with coffees from further afield.

“India is a unique origin since it has different regions and varieties with each region displaying a distinct character and profile – we procure from all these regions to achieve different profiles,” Rao says. “For the niche customer segment we also offer single origin coffees sourced from Ethiopian Yirgecheffe, Guatemala and Columbia.”

As India’s fascination with coffee grows, Rao says he intends for Bayar’s to be a key player in the journey.

“More and more people are demanding gourmet coffee and certified coffee,” he says. “From traditional filter coffee consumption, new ways of brewing coffee like the French press, pour over and espresso are getting popular. The youngsters are being adventurous trying our new varieties of coffee and different recipes.” GCR