Since April 2019, Cafe Coffee Day has shut down close to 500 of its outlets. The move to close so many outlets comes as the company looks to stop profits from falling further, as well as to to prepare for divestment of the business, reports CNBC-TV18.
CCD has cited a drop in margins and a rise in costs in its coffee business, which has been attributed, at least in part, to the current economic slowdown in India.
In the first financial quarter of 2019, from April to June, CCD had closed down 280 of its cafes, according to the company’s unaudited financial statements. Sources told CNBC-TV18 that the number of outlets closed may have risen to nearly 500 by the end of the second quarter, and that more closures are likely.
CCD currently has around 1,200 to 1,300 outlets across the country, as the company continues discussions to divest its coffee business.
In the company’s filings for the first quarter, CCD had cited a few reasons for the fall in earnings, including a drop in margins and increases in promotional costs due to the economic slowdown.
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