Amalgamated Bean Coffee Trading Co. Ltd, which runs the Café Coffee Day chain, has been seeing sales growth drop over the past two years as slowing economic growth and high inflation hurt demand, and increased competition in India’s dining and fast food market eat into the coffee chain’s share.

The company, founded and owned by chairman V.G. Siddhartha,
generates a majority of its business from its coffee retail chain and exports of coffee. It also runs luxury resorts under The Serai brand and operates a wealth management company.

Competition for Café Coffee Day has been increasing with the entry of the world’s largest coffee chain Starbucks, which launched its first store in India in October 2012 and has since added more than 40 cafes across Delhi, Mumbai, Pune and Bangalore.

Others such as Dunkin’ Donuts, Krispy Kreme and several local brands have also opened stores over the past two years, giving people more alternatives to Café Coffee Day and making it tougher for the coffee chain to retain customers and add new ones.

Café Coffee Day isn’t the only food and beverage outlet suffering from the slowdown in spending by consumers. Most fast food chains in India including McDonald’s, Domino’s and others have reported a sharp fall in growth over the past year.