Here’s a question for you, what constitutes a coffee shop these days? According to the latest figures, there are c15,700 coffee shops in the UK, including the big chains and independents, which saw sales increase by 7.5% to £5.8bn last year. This figure is set to grow to 20,000 outlets and £8bn in sales by 2017.
Indeed, one-fifth of UK consumers visited a coffee shop each day last year, up from one in nine in 2009. But were they visiting a coffee shop or a café?
Take Coffee#1, the 31-strong chain owned by Welsh pub operator Brains, which is steadily expanding out of its south-west and Wales heartland. The name should give you the answer, but 50% of its sales come from food and its trading platform caters well into the evening.
Harris + Hoole, the Tesco-backed artisan chain that will soon be at 20 sites in the south-east, is in a similar position. A significant percentage of its profits come through its growing food offer - a fact highlighted by the brand new development kitchen that is currently being built in Park Royal in north-west London.
Costa is also believed to be looking at ramping up its food
mix, which is currently - like Caffe Nero’s - around the 20% to 25% mark. The company recently hired Jane Treasure, a senior food development manager at McDonald’s, as it new head of food in the UK.
Pret A Manger already has the food side of its business very much taken care off, so is looking at its regional concept stores to address the coffee mix balance and take the brand into the shoulder periods around lunch and breakfast to attract extra trade.
Director Nick Candler, who is overseeing the concept’s development and rollout, said that the company was looking to give its coffee credentials “equal footing with its fresh natural food” and that the four sites already opened under the format in Horsham in West Sussex, Woking in Surrey, Windsor in Berkshire, and Tunbridge Wells in Kent, had given the group a good foundation to build on.
He said: “We wanted to develop our performance outside the traditionally strong trading periods, such as lunch and breakfast.”
Which leaves Starbucks, which is currently searching for a new chief executive and battling with its identity in the United Kingdom. The group is currently expanding from franchising and roadside location but contracting when it comes to the highest footfall area, the high street.
Michelle Gass, its former president of its Europe, Middle East and Africa (EMEA) division, is returning to the US this summer to work directly with chief executive and founder Howard Schultz. She has led the EMEA region through its turnaround and growth efforts over the past two years and the company said she was leaving the EMEA region in “significantly better health than when she arrived, with renewed business momentum and a roadmap for a strong trajectory of sustainable growth and profitability”.
That point is debatable. It is thought that the group at one point had c120 of its UK sites on the market, many in key locations, with high rents being disposed of. For example Five Guys is rumoured to be taking a Starbucks site in Upper Street, Islington.
Over the years, the chain’s food mix has moved towards the 20% mark, but its offer has always had the touch of the US fast-food market about it.
As Baum + Whiteman, the international restaurant consultancy firm, said: “We’re eating less at every meal, but more than making up for it with endless snacking.”
Snacks account for one in five ‘eating occasions’ in the US and multiple snacks now qualify as America’s ‘fourth meal’ and even the traditional three are degenerating into nibbles and bits.
It seems operators are moving away from a purely coffee-based offer to take advantage of this trend. So instead of coffee shops, should we now be asking how many cafés there are in the UK?
