Over the years, Chai Sutta Bar has been one of the most iconic examples of how chai, a classic Indian beverage, has its place in modern cafes, and how this trend can be turned into a new kind of business. It is no longer a mere business; it is a revolution of India’s thriving tea culture. Through its authentic and nostalgic chai in kulhad along with an aesthetically pleasing and cozy place, Chai Sutta Bar has not only retained but also expanded its reach to the young generation and families.
The brand’s high growth trajectory is a testament to its success, with its revenue for the year 2025 projected at a staggering ₹350 Crores. This has made the chai sutta bar franchise one of the most lucrative franchise business in India for aspiring business entrepreneurs. India’s tea industry is booming, and with an in-home market for consumption projected to grow at a 7.05% CAGR by 2029, Chai Sutta Bar’s affordable prices and strong brand reputation offer a lucrative entry into this ever-expanding market. In this guide, we will walk you through all the information, right from the company background history to the exact financial makeup of a Chai Sutta Bar franchise cost. So, let’s get into it!
About Chai Sutta Bar
Chai Sutta Bar was founded by college friends Anubhav Dubey and Anand Nayak in 2016, and later by Rahul Patidar. They had a modest yet stirring idea: to create a cheap, welcoming spot where anyone could sit and enjoy a good cup of tea. The USP of this brand is that it delivers the tea in eco-clay kulhads, which not only provides it with a rural feel but also benefits over 500 potter families throughout the nation. The social impact, with its low cost of as little as ₹10 per cup, has been a success among working professionals and students.
The expansion of Chai Sutta Bar has been phenomenal. It started with a single outlet in Indore and now has over 550 outlets in over 320+ Indian cities in no time. This geometric expansion is a proof of the brand’s strong market demand and operational efficiency. Chai Sutta Bar has also entered overseas markets with equal success, with franchise outlets now functioning in Dubai and Oman. Its future growth ambitions are even greater, looking to hit a milestone of over 800 outlets by 2026 and emerge as a world leader in the tea café space.
| Attribute | Details |
| Founded | 2016 |
| Founders | Anubhav Dubey and Anand Nayak (later joined by Rahul Patidar) |
| Headquarters | Indore, India |
| Unique Selling Point | Tea served in traditional clay kulhads |
| Total Locations | 550+ outlets across India and international markets |
| Industry | Café / Tea Chain |
| Growth & Expansion | Rapidly expanded into multiple cities and countries |
| Public Reception | Widely appreciated for its distinctive tea-serving concept |
Why Invest in a Chai Sutta Bar Franchise?
Investing in a Chai Sutta Bar (CSB) franchise is a carefully considered business move backed by some very robust reasons, varying from its strong financial model to its established brand identity and social cause. Here are some reasons for investing in the same:
Emerging Tea Industry
The Indian tea business is a vast and constantly expanding market. Worth more than ₹15,000 Crores, it is anticipated to grow to ₹21,500 Crores by the year 2027 at a Compound Annual Growth Rate (CAGR) of 6.5%. The stable and booming market provides any tea-based enterprise a solid base to operate from, and since CSB has a well-established market position, franchisees can benefit from this continuously growing momentum.
Payback Oriented Business Model & High ROI
Chai Sutta Bar is a high-return model with a low entry point for entrepreneurs. The investment ranges from ₹16-₹25 Lakhs, and the business model has a margin of 40-50% per cup. The average Return on Investment (ROI) is an impressive 108%, with a payback period of just 12 to 18 months. This quick repayment of capital allows the franchisees to attain profitability within a reduced time frame.
Drastic Growth & Brand Equity
Chai Sutta Bar is a well-branded and established organization that has demonstrated exponential growth. Starting from its first outlet in Indore in 2016 to over 550 outlets in 320+ cities in India and 3 international locations by 2024, the organization has expanded exponentially. The rapid, high-speed growth is an indication of the brand’s strength and reliability. This is also evident through the revenues of the company:
- 2019: ₹50 Crores
- 2020: ₹85 Crores
- 2022: ₹150 Crores
- 2024: ₹220+ Crores (estimated)
- 2025: Projected ₹350 Crores
Unique Selling Propositions (USPs)
The success of the brand is based on a number of unique and compelling factors that appeal to its customers:
- Green Kulhad Chai: Providing tea in traditional, eco-friendly clay cups (kulhads) makes the company stand out from others and appeal to green consumers. The company retails more than 3 lakh kulhads of chai a day, which also contributes to local potters’ livelihoods.
- Welcoming Ambience: CSB creates a hip, café-style atmosphere that becomes a perfect hangout spot for students, professionals, and families, blending old charm with a fresh vibe.
- Affordable Price: The cheap price ensures regular customer visits, thus generating steady profits with an immense number of sales. The company has gained enormous customer loyalty, and its customers include over 80% repeat customers.
- Social Responsibility: Owners of the franchise are a business that also contributes positively to social problems by providing job opportunities to orphans.
Franchisee-Friendly Support
Chai Sutta Bar offers an extensive variety of support to attain the success of its partners. With such an extensive variety of support, risk is diminished, and new business owners are able to thrive. The support features:
- Location selection support
- In-depth staff training
- Pre-tested marketing campaigns
- Daily operations support
A business model capable of supporting existing as well as new business owners due to its considerate nature and minimum investment fees.
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Chai Sutta Bar Franchise Cost in India
The franchisee investment for a Chai Sutta Bar business is ₹16 to ₹25 Lakhs. All operational and setup charges are included in this amount. The investment ensures well-rooted, premium quality chai with the company’s own kulhad tea concept, along with a customer base for a wide range.
Cost Breakdown in Detail
The following is a step-by-step account of one-time as well as ongoing fees associated with opening a Chai Sutta Bar franchise:
Franchise Fee (₹6 – ₹8 Lakhs):
- A one-time, non-refundable payment that grants you the legal authority to operate the business using the Chai Sutta Bar brand name.
- This includes the use of the business model of the brand, trademark, and recipes.
- Some initial start-up support, initial training, and an operations map of the business are also part of this fee.
Setup & Interiors (₹5 – ₹7 Lakhs):
- This is for duplicating your space as the brand name Chai Sutta Bar’s ambiance.
- This is for all interior design, furniture, and décor costs.
- This includes lighting systems, seating, and overall look and feel to achieve a consistent branded café environment.
Equipment & Stock (₹3 – ₹5 Lakhs):
- This is for obtaining all operational stuff needed to run the kitchen.
- It includes tea-making machinery, refrigeration units, and an initial stock of raw materials like tea leaves, milk, and spices.
- This segment also includes the initial supply of their specialty clay kulhads and other working materials.
Licensing & Permits (₹1 – ₹2 Lakhs):
- This expense segment includes all the mandatory legal and regulatory compliances.
- It includes necessary licenses such as the FSSAI (Food Safety and Standards Authority of India) license and GST registration.
- Other required licenses, like a shop establishment license, are also included in this budget.
Marketing & Branding (₹1 – ₹3 Lakhs):
- This is the expenditure for promotional activity to generate local brand awareness and customer attraction.
- It includes the cost of branding material, local print or online ad, and initial launch promotions.
- Social media ads and online marketing expenses are also made to enable a broader reach.
| Expense | Cost (₹) |
| Franchise Fee | 6-8 Lakhs |
| Setup & Interiors | 5-7 Lakhs |
| Equipment & Stock | 3-5 Lakhs |
| Licensing & Permits | 1-2 Lakhs |
| Marketing & Branding | 1-3 Lakhs |
| Total Investment | ₹16-₹25 Lakhs |
Other Operating Expenses
Apart from the upfront fee, the franchisees must budget for regular monthly payments to maintain effective operations.
- Royalty Fee: Franchisees are required to pay a monthly royalty fee of 4% of their total sales revenue to Chai Sutta Bar. The charge ensures ongoing brand support, business guidance, and marketing advantages offered by the parent company.
- Salary of Employees: The employees’ salary typically ranges between ₹30,000 and ₹60,000 per month, depending on the number of employees and their designation in the store.
- Rent: Rent for the store is location-dependent, and it varies between ₹50,000 and ₹1,50,000, with premium rentals in upper-class locations.
Major Requirement to Start
Here are the key requirements to consider for launching a Chai Sutta Bar franchise in India:
- Space: There must be a commercial space of 300 to 2,000 sq. ft. Areas near colleges, bus stands, railway stations, and high-street markets are highly recommended for maximum traffic.
- Staff: You will need to hire a group of 2 to 4 staff for the daily operation and upkeep of superior-class customer service.
- Licenses: You are required to have all the necessary legal documents, including an FSSAI License, GST Registration, Trade License, and a Shop & Establishment Agreement.
Chai Sutta Bar Franchise: Profitability and Investment Overview
The Chai Sutta Bar franchise cost has proven to be a highly profitable venture, driven by its own unique brand name and the enormous cultural popularity of tea in India. The model is built to provide a money-back guarantee quickly, and it is a highly profitable opportunity for young entrepreneurs.
Profitability & ROI: The Potential for Success
A Chai Sutta Bar franchise cost has excellent profit potential with a projected net profit margin of 35% to 40%. High profitability results directly from moderate operational costs and a high, stable consumer segment.
- Fast Payback Period: The franchisees can pay back their initial investment within a relatively short time frame of 12 to 18 months.
- High ROI Potential: The return on investment (ROI) of a Chai Sutta Bar franchise is always high, about 108% annually.
Profit Breakdown (Monthly Estimates)
A location-based Chai Sutta Bar store can have a tremendous monthly turnover. The following breakdown gives an imaginative idea of the expected financial outcome.
- Expected Monthly Revenue: A store can generate a monthly revenue of ₹4,50,000 to ₹7,50,000.
- Gross and Net Profit Margins: Gross profit margin is very high, i.e., between 60% to 70%. After deducting all the operational expenditures, including the 4% royalty fee, rent, and salaries of employees, the net profit margin is between 35% to 40%.
- Net Profit: This translates to an average monthly net profit of ₹1,50,000 to ₹2,50,000, solidifying the franchise’s credibility as a profitable venture.
Chai Sutta Bar Franchise Contact Information
For those who want to take a step forward, here is the official contact information and step-by-step procedure on how to apply:
Official Contact Information:
Corporate Office: 1st Floor, Red Square, PU3 Commercial, opp. C21 Mall, Scheme No 54, Indore, Madhya Pradesh 452001.
Email: business@chaisuttabarindia.com
Phone: +91-6262300031
How to Apply for a Franchise
Beginning the process of opening up your own Chai Sutta Bar is a seamless process. Here is how you can do it:
- Submission of Franchise Application Form Online: You would have to initially visit the official website of Chai Sutta Bar and fill out the franchise application form. You would have to enter required personal and financial information like your full name, contact details, and the planned location of your outlet.
- Location Information & Assessment: In your application, you are also required to give information and photos of the retail outlet that you would like to occupy. Chai Sutta Bar staff will then critically assess the location for profitability prospects and operational feasibility.
- Area Manager Meeting: Following a positive location assessment, you’ll be invited to meet with the company’s area manager. This meeting serves as a crucial final review and allows you to discuss the business plan and franchise agreement terms in detail.
- Agreement and Approval: Once the location and applicant have been approved, a franchise agreement will be signed by the two parties. This is legally the establishment of the partnership and includes the obligations and rights of the franchisee and Chai Sutta Bar.
- Business Setup Assistance: On signing of the agreement, the area manager shall provide complete assistance in fulfilling all terms of the contract and guide you through the first steps of business setup to help navigate a hassle-free experience from application to operation.
Support Provided
Chai Sutta Bar provides a solid support system to its franchisees, including all the tools and resources required to establish and operate a successful business. This includes:
- Strategic Site Selection: The company offers professional guidance for finding a location with heavy traffic, e.g., university campuses, business districts, or transport stations. Their thorough market research helps in choosing an area with excellent chances of success.
- Greater Training Operations: The employees and franchisees are given thorough training in all aspects of the business, from learning the technique of preparing teas to inventory management to delivering class-apart customer services. This ensures the quality and fine-tuned operations in all the outlets.
- Brand and Integrated Marketing: In order to maintain visibility and promote the brand, the brand will continually provide marketing and promotional support. This kind of support not only allows franchisees to become well established in their local areas, but also to have a stable flow of customers.
- Efficient Supply Chain Management: Chai Sutta Bar provides an efficient supply chain to ensure a consistent supply of quality raw material, including their popular kulhads, which are environmentally friendly. The support of logistics helps franchisees focus on business growth without any procurement issues.
- Ongoing Operational Guidance: The assistance does not stop at the grand opening. Franchisees are provided with ongoing expert guidance on daily operations, inventory management, and customer care, so that all operational issues are addressed effectively and in a timely manner.
Tips for Success
Becoming profitable and achieving long-term growth with your Chai Sutta Bar franchise cost is more than merely adhering to the brand’s rules. A proactive attitude and prioritizing customer interaction are vital to maximizing your investment return. Here are a few tips for success:
- Optimize Your Location: Although Chai Sutta Bar can aid in site selection, it is essential to actually select a site that is in line with the brand’s target demographic. Select locations surrounding colleges, corporate buildings, and busy bazaars to have a consistent volume of young professionals and students who are the brand’s primary consumers.
- Customer Experience First: Train your staff not just in the operations but also in providing warm, friendly, and effective service. A positive interaction can convert an occasional guest into a loyal, repeat guest, which is essential for sales predictability.
- Ensure Brand Integrity: Maintaining the brand’s highest standards of product quality, cleanliness, and ambience is essential. Quality in every single cup of chai and a clean, welcoming atmosphere generate trust and enhance the brand’s good reputation with the customer.
- Harness Social and Digital Media: Leverage social media platforms like Instagram and Facebook to build a local community for your outlet. Build targeted ads, announce special promotions, and showcase your unique environment to attract new individuals and keep your existing clientele.
- Involve the Local Community: Attend local events, college festivals, and celebrations to create brand awareness and reach out to potential clients. Not only does this engage the local community, but it also makes your franchise a local hotspot.
Conclusion: Is It Profitable?
Indeed, investing in a Chai Sutta Bar franchise is such a worthwhile project. The combination of a low initial Chai Sutta Bar franchise cost, a product in high demand, and a good support system gives way to a low-risk, high-return business opportunity.
The company’s high growth trend and solid market share further accentuate its ability to overcome for the long haul. Moreover, you are fully supported right from the supply chain management to the marketing support, thus you are operational from day one. If you love business and tea, then a Chai Sutta Bar franchise might just be the perfect entry point for you into the booming Indian tea industry.
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FAQs
1. What is the minimum investment required to start a franchise?
The minimum investment to start a Chai Sutta Bar franchise cost is roughly ₹16 to ₹25 lakhs, including the franchisee fee, setup, machinery, and the first inventory.
2. How much is the profit margin for a Chai Sutta Bar franchise?
The net profit margin for the franchisee would be between 35% and 40%, with an expected monthly turnover of ₹1.5 lakhs to ₹2.5 lakhs, making the franchise cost of the chai sutta bar highly profitable.
3. How much is the royalty fee?
The fee of royalty is a recurring monthly payment of 4% of the monthly turnover that is made to invest in ongoing marketing, operations, and counseling.
4. How quickly is the return on investment (ROI) achieved?
The majority of franchisees are able to recoup their initial investment within 12 to 18 months because of the high profitability of the brand and its well-established customer base.
5. Does Chai Sutta Bar provide support to new franchisees?
Yes, Chai Sutta Bar provides thorough support, such as site selection, staff training, marketing ideas, and daily operational guidance in an attempt to make its franchisees successful.