Watch out, Starbucks: OYO is brewing plans to start premium coffee chain

After hotels, homestays, co-working and co-living spaces, OYO Hotels & Homes is planning to go all out in the food business by launching a coffee chain as well as a slew of restaurants. It is learnt that over the next few months, the Ritesh Agarwal-led company is ready to set up more than 50 premium coffee shops under the brand name The French Press. Plans to start a restaurant chain on the back of its four cloud kitchens are also on the drawing board.

Significantly, OYO is changing tack and shedding its “affordable” image for its chain of premium coffee shops so that it can take on coffee chain giant Starbucks. Sources said that to ensure that the brand is considered exclusive, the company has decided not to use the OYP branding with The French Press.  

OYO plans to take on Starbucks as it believes that there are not many players in the premium coffee chain space. It believes that it has the wherewithal to pull it off. But it also knows that the OYO brand is equated with being affordable and economical. That is why it has decided not to use the OYO branding. The target market is a little different,” said the source. 

While the first few The French Press outlets have been opened in OYO Townhouses as a pilot, the next few would be set up in high streets and malls. A few of the higher-end OYO co-working spaces situated in posh office complexes may also get these coffee outlets.

However, in response to a detailed questionnaire on its plans around The French Press and restaurants, OYO merely said that they have an active play in the F&B business.

“As the largest hotel chain in India, we at OYO, operate several full-service hotels around the country. We have an active play in the F&B business with over 25 per cent of our revenue coming from the kitchens we operate in such full-service hotels. Hence, culinary design and good food experience are valuable to us. We have nothing further to announce at the moment,” the OYO spokesperson said.

But sources said OYO is also planning to set up some premium restaurants post the launch of The French Press. In recent months, the company has started four cloud kitchen brands — Adraq, O Biriyani, Paratha Pandit and Master of Momos. OYO  plans to use these kitchens to power its restaurants, which could be set up in its hotel and co-working properties and as standalone restaurants, too.

“The restaurant business would be a mix of need-based service and premium. If one brand caters to the office crowd at its workspaces, another would aim for the high street premium clientele. But the plans for the restaurants are still on the drawing board,” said the source.

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