What: Tata Group's Trent has reportedly signed a licensing agreement with British coffee chain Caffe Nero to open cafes inside its Westside and Zudio stores, after talks with Tata Starbucks on a similar arrangement broke down.

Why it is important: Trent is licensing a specialist coffee brand rather than building its own cafe business, the same logic behind the food-led traffic strategies at department stores in Seoul and the UK, where food is used to extend dwell time.

Tata Group retailer Trent has signed a licensing agreement with British coffee chain Caffe Nero to open cafes within its Westside and Zudio stores, people familiar with the matter said, even though the group has an existing joint venture with Starbucks. The commercial terms, rollout schedule and number of cafes could not be ascertained.

The agreement follows the breakdown of talks between Trent and Tata Starbucks, the joint venture between Tata Consumer Products and Starbucks Coffee Co. Starbucks wanted a prominent, front-facing presence within Trent's stores, which the retailer was unwilling to accommodate, and the two also differed over Starbucks' control of formats and locations. Harish Bhat, a Tata veteran linked to Starbucks' development in India, recently left Trent's board to avoid a conflict of interest.

For Trent, the partnership offers access to a specialist coffee brand without developing its own cafe business. High real estate costs make cafe economics important in India, where retailers must maximise revenue per square foot. Caffe Nero, founded in London in 1997, could gain a platform for a large presence in India, although the scale and pace of expansion remain unclear.

IADS Notes: Food-led formats are becoming a standard traffic lever for department stores. At Seoul's leading flagships, food halls are the main entry point for younger first-time visitors: 78% of first-time visitors to The Modern Food Hall were in their 20s and 30s, and 79% of them went on to buy other products (Maeil Business Newspaper, October 2026). Selfridges, John Lewis, Liberty and Harrods are likewise using food halls, restaurants and workshops to extend dwell time and compete for consumers' leisure time rather than routine purchases (The Retail Bulletin, July 2026). Trent's store base is expanding quickly, with Westside planning up to 100 openings a year, roughly double its current pace, while Zudio's revenue growth slows and Reliance and Aditya Birla compete harder; limited retail space is among the constraints weighing on the sector (India Economic Times, July 2026). By September 30, 2026, Trent's portfolio stood at 1,342 stores across Westside, Zudio and other lifestyle brands (India Economic Times, October 2026). Space productivity is the pressure point: a 16% fall in revenue per square foot had already raised cannibalisation concerns in January 2026, alongside a restructuring of Trent's joint ventures with Inditex and the sale of its stake in Massimo Dutti India (Bloomberg, January 2026).

Trent set to serve up Caffe Nero at Westside, Zudio outlets