The UK is the leading market driving growth in European branded coffee shops by 6.4% in 2017, Allegra World Coffee Portal reveals.
Long the model for the branded coffee shop industry in Europe, the UK added 643 units to reach an estimated 7,421 outlets in 2017.
Across 25 European countries, branded coffee shops reached an estimated 22,714 outlets, with expansion matching the previous year, and the market continuing to grow at a steady pace, facilitated by a generally positive economic environment.
After the UK, Turkey and Russia were the strongest performers, with 21 of the 25 European countries seeing expansion of branded coffee shops, and 18 of those displaying growth of 3% or higher.
Costa Coffee remains the largest chain in Europe, adding 243 stores in the past 12 months to bring its total to 2,755 outlets.
Starbucks added 251 new stores to reach 2,406 outlets and has now overtaken McCafé to become the second largest operator in the market.
With its Italian debut in 2018, commencing with the opening of the ultra-premium Reserve roastery in Milan, Starbucks will be the first coffee shop chain to have a presence in all 25 key European markets.
Meanwhile the ‘third wave’ artisan scene is growing across Europe and established in some cities in the UK, Russia, Nordics and the Netherlands.
Successful branded chains are adapting to this influence with new in-store design, single origin coffee and freshly prepared food offerings.
The Project Café2018 Europe report finds markets which have yet to embrace this trend are starting to fall behind in terms of outlet growth compared with the rest of Europe.
In the most advanced markets, a new trend the ‘5th Wave, The Business of Coffee’, is seeing high quality artisan chains adopting more advanced business practices and higher standards to deliver boutique concepts at scale.
Allegra anticipates the market growth to continue at a steady rate with opportunities in countries where international chains are influencing the expansion of domestic brands.
The future of the coffee shop market will be shaped by the “continued increase in consumer participation and the desire for quality coffee anywhere and anytime”, Allegra said.
Jeffrey Young, managing director of Allegra Group, said: “We are entering an exciting new era of leadership in the industry, one that is based on a culture of excellence.
“Addressing these rapidly changing market dynamics is a business imperative and leading chains will need to adapt or risk getting left behind.’