A US coffee chain is considering opening in India. How would you approach it?

Can I check a couple of things first? Is the goal profit in India itself, or a foothold in a growth market even if it takes years to pay back? And have they opened outside the US before? I'd split this into four questions. One, is there enough demand? I'd want the size of the cafe market and how fast it's growing. Two, who's already there? I'd look at local chains and other international brands, and what they charge. Three, can the store economics work? I'd look at revenue and costs per store. The number I care about is how long a store takes to pay back. Four, how should they enter? They could own the stores, franchise, or do a joint venture. I'd compare those on control, capital and speed. I'd begin with demand. What do we know about the market?

Can I check a couple of things first? Is the goal profit in India itself, or a foothold in a growth market even if it takes years to pay back? And have they opened outside the US before? I'll assume they want a business that's profitable on its own within about seven years. I'd split this into four questions. One, is there enough demand? I'd want the size of the cafe market and how fast it's growing. India mostly drinks tea, so I wouldn't size this on population. I'd count people in the ten or so biggest cities who can afford a three or four dollar drink, and I'd treat the cafe as a place to meet as much as a place for coffee. Two, who's already there? I'd look at local chains and other international brands, and what they charge. The real competition for that customer's money might be a local chain at half the price. Three, can the store economics work? Prices have to be lower than in the US while rent in the best parts of Mumbai or Delhi is high. So I'd build a single-store P&L with local prices, rent and wages. The number I care about is how long a store takes to pay back. Four, how should they enter? They could own the stores, franchise, or do a joint venture. I'd compare those on control, capital and speed. A local partner matters more here because of access to real estate. My hypothesis is that demand is there in the big cities and store economics decide it, so that's where I'd start. Do we have rent and price benchmarks from existing chains?