0 Comments |  Growth |  PRINT | 

Boost Juice to open 100 stores in India as Shanghai store struggles

Wednesday, 28 September 2011 | By Madeleine Heffernan

Boost Juice plans to open 100 stores across India during the five years to 2017, seeking to capitalise on the country’s “growing franchise business culture” and lack of market leadership in the smoothie and juice market, but says growth in its Chinese operations has been disappointing.

 

The private equity-owned business has inked a $1.6 million master franchise agreement with Rivoli Sinha and Dev Agarwal.

 

Sinha is the daughter of the founder of SIS Group Entrerprises, an Indian security giant which owns the Chubb security firm in Australia. She and her husband have set up a business to run Boost in India.

 

In a statement, Sinha and Agarwal said they had noticed “a tremendous potential in the Indian market for fresh and healthy drinks” and “Boost is a perfect brand to bring to India as the range of delicious juices and smoothies is matched with passion and energy – which is key for any business to succeed in India.”

 

Boost general manager Scott Meneilly says the partnership and local knowledge it will deliver will prove the key to Boost cracking the Indian market, and nominates Gloria Jean's, KFC and Domino's as Western brands which have entered the Indian market. Other food franchises, including Allied Brands, have tried to crack the market and failed.

 

Meneilly says Boost’s main sellers – mango, strawberry, berry, and banana drinks – are well accepted in India and the company will be targeting the middle-class market, teenagers and up.

 

It will spend quite a bit of time and money setting up in Delhi before heading to other cities, with prices under $3.

 

“Fresh juice is immensely popular but it’s about the smoothie category,” Meneilly says, adding that Boost does not necessarily see the lassie drink as a competitor.

 

Boost hopes the deal will lead to five new bars opened next year followed by 95 more through to 2017. Boost has 65 stores overseas in 15 countries, including in Asia, Europe and South Africa.

 

Meneilly says the Shanghai store, which is newly opened, has "definitely not been an easy market for us.”

"One of the biggest struggles for us has been the understanding of the product.”

 

Meneilly says because Boost is a premium product the Chinese are looking for a premium environment where they can sit down and access Wi-Fi, which contrasts with Australia’s kiosk-style shops, where Boost is more seen as a takeaway item.

 

Janine Allis, who founded Boost 12 years ago, was travelling and unavailable for comment this morning, but told SmartCompany in July that she was talking to three businesses in Australia about potential acquisitions and had an open mind on overseas expansion.

 

Allis said the business had never been in better shape and estimated revenue from overseas was about 20%.

 

“We don’t really want to be a master from another company so we’re thinking outside of the square of other ways of growing but still fit with our strategy of how we continue to grow,” Allis said.

 

US private equity firm Riverside this year took a 70% stake in Boost last year with a view to expanding Boost’s overseas operations.

 

This article first appeared on SmartCompany.