Specialty coffee chain Blue Tokai is eyeing to become a Rs 1,000 crore brand over the next 3 years. Due to growth in out-of-home consumption, last year, the brand registered double-digit same-store sales growth, Matt Chitharanjan, co-founder and CEO of Blue Tokai told ETRetail.

The coffee chain, which closed the last fiscal year at Rs 220 crore, is planning to close this fiscal year at Rs 350 crore and the next fiscal year at Rs 550 crore.

"Currently, we're just 3 per cent EBITDA positive. We just turned profitable past quarter. But now, as operational efficiencies kick in, we expect a steady state to be able to reach 15 per cent EBITDA over the next 3 years," he asserted.

To achieve its targets, the brand plans to expand its presence further, invest in state-of-the-art bakeries, penetrate deeper via quick commerce, and expand its out-of-home consumption menu.

"This financial year, we will be closing with 152 outlets, and for the next 3 years, we plan to open 80-90 outlets every year," he stated.

"Going ahead, we plan to penetrate deeper into the existing markets and also expand in markets like Dehradun, and opening cafes in Hyderabad," he further added.

Currently, all of the stores of the brand are company-owned and company-operated. The average store size of the brand varies between 800 sq.ft - 1,200 sq.ft

"We are also launching five new experience stores in cities like Gurugram, Mumbai, and Bengaluru. These are larger format stores spanning across 2,000 sq.ft. and we will be offering a wider menu along with live baking," he said.

"The first experience centre is expected to open in the next months in Gurugram," he further added.

The CAPEX involved in opening a smaller format store for the brand stands at Rs 80 lakh and the CAPEX for the experience centre stands at around Rs 1 crore.

"Apart from this, we have invested Rs 5 crore to open a new state-of-the-art bakery in Bengaluru later this month, and then from there, we'll be able to cater to the entire South demand," he said.

The bakery cum roastery in Bengaluru spans across 20,000 sq.ft. The brand also runs 3 more bakeries in Delhi, Mumbai, and Kolkata spanning across 20,000 sq.ft, 4,000 sq.ft, and 2,000 sq.ft, respectively.

At present, 75 per cent of the revenue of the brand comes from cafes, 12 per cent from online, and the remaining 13 per cent is contributed by the outright supply of coffee and machines in the corporate offices.

"At present, we have deployed around 500 machines and by the next fiscal year-end, we look forward to taking it up to 1,000 machines," he stated.

"We're also looking to expand our portfolio of convenience-based products like ready-to-drink coffee for the out-of-home segment," he further added.

Going ahead the brand sees quick commerce also becoming a significant growth driver.

"Currently, we're at only around 15 per cent of the coverage on the bakery, on quick commerce as we are as coffee, yet we're doing almost 80 per cent of the revenue numbers there. So, we see a significant opportunity for that to become a big driver for us going forward," he explained.

As far as the international presence of the brand is concerned, it has a presence in Japan for the past 2 years.

"It was first as an e-commerce and wholesale supply. Then we started doing pop-up cafes. Now, we have our first permanent cafe in Tokyo operational for about four months," he said.

"We'll be expanding to a few more locations in Japan. But, we see way more opportunity in India than in any other market for the next three years within India," he concluded.