Pakistan is a tea country trying to become a coffee country.
That transformation is visible almost everywhere in the country’s major urban centres. Cafés are increasingly packed with young professionals, students, entrepreneurs, freelancers and families. International coffee chains continue to expand, Pakistani operators are opening new outlets, specialty roasters are educating consumers about beans and brewing methods, and a growing number of customers are buying espresso machines, grinders, pour-over equipment and coffee beans for home.
Yet there is an important distinction between a coffee culture and a coffee market.
Pakistan clearly has the former.
The question is how large the latter actually is.
The latest available industry research shows that coffee consumption is rising, particularly among young urban consumers, while premiumisation, specialty coffee and home brewing are creating new opportunities. But tea remains overwhelmingly dominant, and coffee is still heavily concentrated among relatively affluent urban consumers. Euromonitor identifies rising café culture, premiumisation and home brewing as important growth trends, while Nescafé remains the dominant retail coffee brand because of Nestlé’s distribution, brand recognition and first-mover advantage.
This creates a fascinating contradiction.
Pakistan’s coffee scene looks considerably bigger from inside Lahore, Karachi or Islamabad’s commercial districts than it does when measured against the country’s total population.
And that is precisely why the coffee business deserves a closer look.
The Nescafé economy
For millions of Pakistanis, coffee does not begin with an espresso machine.
It begins with a jar of instant coffee.
Nescafé has been able to build the country’s largest retail coffee position by making coffee accessible through supermarkets, neighbourhood stores, e-commerce and traditional retail channels. Euromonitor describes Nestlé as the clear retail-value leader in Pakistan, with Nescafé positioned both as an everyday household product and a youth-oriented brand.
That distinction is critical.
The person buying a small jar of instant coffee is part of Pakistan’s coffee economy even if they have never visited a specialty café.
The café customer drinking a cappuccino in Gulberg is also part of it.
The home brewer buying Ethiopian beans online is part of it.
The office purchasing an espresso machine is part of it.
The hotel sourcing coffee beans for breakfast service is part of it.
And the young consumer buying an iced latte through a delivery application is part of it.
Pakistan therefore does not have one coffee market. It has several overlapping markets.
Tea remains the giant in the room
The biggest obstacle to coffee becoming a mass-market beverage is not a lack of cafés.
It is tea.
Tea is deeply embedded in Pakistan’s household consumption, hospitality culture, offices, roadside restaurants and social gatherings.
Coffee, by comparison, remains disproportionately urban, aspirational and income-sensitive.
This explains why a city can experience a genuine café boom without Pakistan becoming a coffee-drinking nation in the same sense as traditional coffee markets.
The opportunity is therefore not necessarily to replace tea.
It is to create occasions in which consumers drink coffee in addition to tea.
That is already happening.
Coffee is increasingly associated with meetings, studying, working remotely, dates, social gatherings, business discussions and lifestyle consumption.
The café is becoming as important as the cup.
The international chains changed the game
International brands have played a major role in creating Pakistan’s modern coffee culture.
Gloria Jean’s Coffees entered Pakistan in 2007 and describes itself as the country’s largest international coffee chain, with more than 40 outlets in over a dozen cities. Its current store locator shows a broad footprint across Lahore, Islamabad/Rawalpindi, Karachi, Faisalabad, Multan and other locations.
The Coffee Bean & Tea Leaf has also built a significant footprint, with stores listed across Lahore, Islamabad, Rawalpindi, Karachi, Faisalabad, Gujranwala and Sialkot. Its Pakistani operation says it operates its local stores itself rather than offering franchises.
Then came Tim Hortons.
Its arrival in Lahore in February 2023 became one of the most visible demonstrations of Pakistan’s appetite for branded coffee. Reuters reported long queues outside its first Lahore outlet even as the country was experiencing severe economic pressures and high inflation.
The chain has since expanded its Pakistani network. Its current locations include multiple Lahore outlets, several Islamabad locations and branches in Rawalpindi.
The significance of Tim Hortons was bigger than the brand itself.
It demonstrated that consumers were willing to spend substantially more than the price of a domestic cup of tea for a branded coffee experience.
That does not mean every Pakistani household can afford it.
It means there is a sufficiently large consumer segment that can.
But the real story is local
International brands attract attention, but the more interesting structural development may be the growth of Pakistani coffee businesses.
One of the clearest examples is Coffee Wagera.
Launched in 2018, the company now lists 13 locations across four cities, including outlets and kiosks in Karachi, Hyderabad and Lahore. Its model goes beyond selling beverages, incorporating workspaces, Wi-Fi, loyalty and other elements of the café experience.
This is important because it represents a different proposition from simply importing an international brand.
Local operators understand Pakistani real estate, local consumer behaviour, price sensitivity, food preferences and neighbourhood economics.
They can also adjust menus faster.
That flexibility matters in a market where coffee may be the headline product but food, ambience, seating, service and location frequently determine whether the business survives.
Then came the specialty-coffee generation
The next layer of the industry is even more interesting.
Pakistan now has a growing group of independent and specialty-oriented coffee businesses that are not simply trying to reproduce the international chain model.
They are selling the coffee itself.
That means attention to beans, roast profiles, extraction, grinders, brewing techniques, milk texture, cold brews and increasingly the provenance of coffee.
Among the names that deserve attention in this emerging segment are Third Culture Coffee, Retrograde Coffee and Zyah Café.
Third Culture Coffee has established a presence in Lahore’s Gulberg market, positioning itself within the increasingly sophisticated independent café environment. Its Gulberg outlet reflects the growing demand for coffee-focused businesses outside the conventional international franchise model.
Retrograde Coffee is another example of the independent café movement, with a presence in Gulberg. Its existence alongside international chains and larger Pakistani operators demonstrates how fragmented the urban coffee market has become.
Zyah Café, also operating in Lahore’s Gulberg area, represents another part of the new café economy in which coffee, ambience, design and lifestyle are increasingly sold together.
These businesses matter even if their individual outlet counts are much smaller than those of major international chains.
Why?
Because they are helping change what Pakistani consumers expect from coffee.
The consumer who once asked for “coffee” may now ask for a flat white, Spanish latte, V60, cold brew, single-origin beans or a particular roast profile.
That is market development.
The emergence of Third Culture, Retrograde, Zyah and similar independent operators means Pakistan’s coffee sector is no longer simply about international chains versus instant coffee.
There is now a middle layer — and potentially the most innovative one.
The specialty-roaster opportunity
Behind every specialty café is another business opportunity: roasting.
Pakistan does not have a meaningful commercial coffee-growing industry capable of supplying the domestic market at scale.
That means the value chain starts largely outside Pakistan.
Coffee beans are imported.
They can then be roasted, blended, packaged, distributed and brewed locally.
This is where companies such as Artisan Coffee Roaster and other Pakistani specialty suppliers have created a different business model.
Instead of building hundreds of cafés, a roaster can supply cafés, restaurants, hotels, offices and home consumers.
That can produce a considerably different economics.
One roaster can potentially serve dozens or hundreds of commercial customers.
The opportunity therefore exists not only in B2C coffee shops but also in B2B coffee supply.
The import numbers reveal the structural weakness
Pakistan’s coffee economy remains dependent on imports.
World Bank WITS data shows Pakistan imported 159.9 tonnes of unroasted, non-decaffeinated coffee worth about $570,000 in 2024, with Brazil, Ethiopia, Guatemala, Colombia and Indonesia among the principal suppliers.
That was almost double the 81 tonnes imported in 2023, when the value was around $211,000.
Pakistan also imported 117.9 tonnes of roasted, non-decaffeinated coffee worth about $940,500 in 2023, with Italy, Malaysia, the UAE, the United States and Vietnam among the leading suppliers.
Roasted decaffeinated coffee imports added another 21.96 tonnes worth $93,300 in 2024.
These customs categories do not represent the entire coffee economy — instant coffee, mixes, foodservice purchases and other categories have different classifications — but they demonstrate an important reality:
Pakistan is not yet a coffee-producing economy. It is a coffee-importing and increasingly coffee-processing economy.
That distinction creates both vulnerability and opportunity.
Coffee prices are therefore an international problem
A Pakistani coffee company has little control over what happens at origin.
Brazilian crops matter.
Ethiopian supply matters.
Colombian production matters.
Global shipping costs matter.
The rupee-dollar exchange rate matters.
Import duties and taxes matter.
International coffee prices matter.
And all of these variables eventually reach the Pakistani consumer.
A café may appear to be selling a Rs700, Rs800 or Rs1,000 beverage, but the business is managing far more than the coffee bean.
Rent, electricity, generators, staff, imported machines, grinders, maintenance, milk, syrups, cups, packaging, delivery commissions, wastage and food costs all have to be absorbed.
This explains why opening a café is substantially easier than making a café profitable.
The machine business is another hidden market
There is another part of the coffee economy that consumers rarely see.
Coffee equipment.
Every new specialty café requires espresso machines, grinders, brewing equipment, water filtration, refrigeration and other hardware.
Home brewing creates another market for grinders, French presses, moka pots, AeroPress-style brewers, pour-over equipment, scales and increasingly domestic espresso machines.
The expansion of coffee therefore creates an ecosystem around the beverage.
Beans are one business.
Roasting is another.
Machines are another.
Maintenance is another.
Barista training is another.
Café design is another.
Delivery is another.
Packaging is another.
And hospitality technology adds yet another layer.
The coffee economy can consequently grow even when the actual number of cups consumed remains relatively modest.
The home-brewing revolution
Euromonitor identifies home brewing as a strong growth opportunity in Pakistan.
That is potentially more important than it sounds.
A café customer eventually asks a simple question:
“Can I make this at home?”
Once consumers become interested in coffee quality, they begin experimenting with beans, grinders and brewing methods.
This creates a new consumer category.
A person who previously purchased a jar of instant coffee may begin buying ground coffee.
Then whole beans.
Then a grinder.
Then better equipment.
Then single-origin coffee.
The progression from instant to specialty does not happen overnight, but it creates a higher-value consumer.
E-commerce is particularly important here because specialty coffee does not need a supermarket shelf in every neighbourhood.
A customer can discover a roaster through Instagram, order beans online and receive them at home.
Euromonitor identifies e-commerce as an increasingly important part of Pakistan’s coffee retail landscape.
The café is becoming a lifestyle business
This is perhaps the most important change in Pakistan’s coffee economy.
The modern café is not selling only coffee.
It is selling time.
A customer may buy one coffee and occupy a table for two hours.
They may use Wi-Fi.
Hold a meeting.
Study.
Work remotely.
Take photographs.
Order food.
Meet friends.
Return the following week.
That changes the economics completely.
The strongest cafés therefore increasingly resemble hospitality businesses rather than beverage counters.
This explains the success of premium locations and lifestyle-driven independent operators.
The customer is paying for the environment as much as the liquid inside the cup.
The Third Culture, Retrograde and Zyah effect
The emergence of brands such as Third Culture Coffee, Retrograde and Zyah is particularly significant because they demonstrate that Pakistan’s market is beginning to support different interpretations of the café.
The international chain offers consistency and brand recognition.
The Pakistani chain offers local market understanding and potentially faster adaptation.
The specialty café offers identity.
The specialty roaster offers product expertise.
And the lifestyle café offers an experience.
These categories overlap, but they are not identical.
That fragmentation is a sign of a maturing market.
The presence of Third Culture Coffee and Retrograde in Lahore’s Gulberg cluster, alongside established international and Pakistani chains, illustrates how a single commercial district can now contain multiple coffee propositions competing for different customer occasions. The same is true of newer lifestyle-oriented cafés such as Zyah.
The next battle may therefore not be about who can open the most cafés.
It may be about who can build the strongest coffee community.
There is still no Starbucks — and that matters
One of the most obvious questions surrounding Pakistan’s coffee sector is why Starbucks has not established an official nationwide operation comparable with its presence in other major emerging markets.
The absence of Starbucks does not mean there is no demand.
In fact, the growth of Tim Hortons, Gloria Jean’s, Coffee Bean & Tea Leaf and Pakistani operators suggests that demand for branded coffee exists.
But the absence of a particular global giant also leaves room for domestic businesses.
Pakistani entrepreneurs have an opportunity to build brands before the market becomes saturated with global chains.
That window may not remain open indefinitely.
International brands are no longer entering an empty market
The first generation of international coffee chains could educate consumers about cappuccinos, lattes and café culture.
The next generation is entering a market where consumers are increasingly educated.
That changes competition.
A new entrant is no longer competing only against another franchise.
It is competing against:
Nescafé at home.
A neighbourhood café.
A specialty roaster.
A Pakistani coffee chain.
A bakery serving coffee.
A hotel.
A delivery-only concept.
And increasingly, the customer’s own espresso machine.
The consumer now has choices.
Why exact “market share” numbers are difficult
There is a temptation to produce a table saying one coffee chain has 20 per cent, another 15 per cent and another 10 per cent of Pakistan’s coffee market.
Such numbers would be misleading without access to proprietary industry datasets.
The reason is simple.
Coffee is not a single category.
Retail instant coffee is different from fresh beans.
Fresh beans are different from foodservice.
A coffee sold at a hotel is different from a jar sold at a supermarket.
A café’s sales are not directly comparable with packaged retail sales.
Even Euromonitor separates fresh coffee, instant coffee and foodservice categories in its analysis.
Therefore, the more useful question is not:
“Who owns X per cent of Pakistan’s coffee market?”
It is:
“Who controls which part of Pakistan’s coffee value chain?”
On that basis, the picture becomes much clearer.
Nestlé dominates mass retail coffee.
International chains dominate important branded café locations.
Pakistani chains are building national and regional footprints.
Specialty roasters are developing the premium bean market.
Independent cafés are shaping consumer taste.
E-commerce is connecting consumers with specialty products.
And home brewing is creating an entirely new consumption occasion.
Ready-to-drink coffee remains a sleeping segment
Another potentially important category is ready-to-drink coffee.
At present, it remains small.
Euromonitor describes RTD coffee in Pakistan as a niche category constrained by relatively low consumer awareness, price sensitivity and limited distribution. Nestlé remains a significant player through Nescafé RTD products.
But RTD could become important as convenience becomes more valuable.
Cold coffee in bottles and cans can move beyond cafés into supermarkets, petrol stations, convenience stores, gyms, universities and offices.
The challenge is pricing.
Pakistan’s consumer is highly price-sensitive.
A premium bottled coffee has to compete not only with another coffee product but also with tea, soft drinks, juices, energy drinks and inexpensive local beverages.
The office market could be bigger than it looks
Corporate coffee is another largely invisible opportunity.
Banks.
Software houses.
Call centres.
Advertising agencies.
Media organisations.
Multinationals.
Hotels.
Co-working spaces.
Airports.
Universities.
Hospitals.
Large offices increasingly require coffee solutions.
That can mean machines, beans, maintenance contracts and trained staff.
A coffee company that builds a B2B model can therefore grow without depending entirely on expensive high-street cafés.
This may ultimately prove more scalable than opening outlets one by one.
Pakistan’s biggest opportunity may be local roasting
There is a strategic opportunity hiding in Pakistan’s dependence on imported coffee.
Pakistan may not be able to grow large quantities of commercial coffee domestically, but it can capture more value after the beans arrive.
Roasting.
Blending.
Packaging.
Quality control.
Training.
Equipment.
Distribution.
Private labels.
Corporate supply.
These are areas where local companies can develop capabilities.
Instead of importing finished roasted coffee, businesses can increasingly import green beans and add value locally.
The 2024 import figures for green coffee, particularly from Brazil and Ethiopia, suggest that this supply chain is already developing.
The economics will ultimately decide who survives
The biggest danger for Pakistan’s coffee boom is not lack of consumers.
It is excessive optimism.
A café can be full every evening and still lose money.
High rents, imported equipment, electricity costs, employee turnover, wastage and low table turnover can destroy margins.
Coffee is also vulnerable to inflation because many inputs are either imported or indirectly linked to foreign currency.
The strongest businesses will therefore be those that understand unit economics.
They will know exactly how much each cup costs.
They will understand average ticket size.
They will measure repeat customers.
They will calculate table turnover.
They will optimise food attachment.
They will manage delivery commissions.
And they will differentiate between sales growth and profitable growth.
The coffee industry is not immune to the fundamental rule of business:
Revenue is not profit.
So, is there really a coffee market in Pakistan?
Yes.
But it is not yet a mass-market coffee economy.
It is a layered, urban and rapidly developing market.
At the bottom is instant coffee, led overwhelmingly by established packaged brands.
Above that is the expanding café market.
Alongside it are international chains and Pakistani café networks.
Above that is specialty coffee.
Then come independent brands such as Third Culture Coffee, Retrograde and Zyah, among many other emerging operators.
Beyond the café sits the roaster, importer, equipment supplier, trainer and distributor.
And at the consumer end is a new generation experimenting with coffee at home.
The market is therefore growing in depth before it grows fully in breadth.
That may be the most important finding of all.
Pakistan does not need to become a country where every household drinks coffee for the coffee industry to become a major business.
It only needs enough consumers to drink better coffee more frequently.
The next decade could therefore see the industry move from selling coffee as a beverage to selling coffee as an ecosystem.
And once that happens, the real competition will not simply be between Nescafé, Tim Hortons, Gloria Jean’s, Coffee Bean & Tea Leaf, Coffee Wagera, Third Culture, Retrograde or Zyah.
It will be between different ideas of what coffee means in Pakistan.
For some, it will remain a three-in-one sachet or a spoonful of instant coffee.
For others, it will be a Rs1,000 café experience.
For an emerging specialty consumer, it may be an Ethiopian single-origin brewed at home.
And for the entrepreneur, it could become one of Pakistan’s next serious consumer and hospitality industries.