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Coffee market can add froth to your business

20 January 2012
Coffee market can add froth to your business

Consumers are certainly tightening their belts, and may even have resolved to drink less in 2012, but one luxury it seems we can no longer contemplate cutting back on is coffee.

Since 2005, the branded coffee chain market has doubled and is now estimated to be worth £2.1b according to Allegra Strategies. Its latest research has found that one in 10 adults now visit coffee shops daily, with 39% saying they visit more than they did a year ago.

Little wonder that the market is being eyed enviously across the industry. Whitbread is one group that invested early and is now reaping the rewards, with Costa - now the market leader - quickly becoming the group's star turn.

It is certainly pushing sister business Premier Inn close, which is saying something since - as Whitbread Hotels & Restaurants managing director Patrick Dempsey explains - the hotel chain has trebled in size in 10 years.

Contract caterers haven't been slow to get in on the coffee action either. The latest of which is CH&Co, who has entered into a joint venture with cafe/deli brand Apostrophe.

It has bought a 50% stake in the firm and negotiated a master franchise agreement to roll it out at client sites. Having also patrnered with coffee supplier Paddy & Scott's, CH&Co chairman Tim Jones is well aware of coffee's potential as a high margin product.

Fortunately for the industry, it is also considered an affordable indulgence by consumers. Regardless of whether you run a chain or independent operation, taking an artisanal approach to coffee making and an interest in brewing methods might just add a bit of froth to your business.

By James Stagg

E-mail your comments to James Stagg here.

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