Takeaway beverages – on the move

13 November 2009

The trade in take-away beverages has risen at an extraordinary rate in recent years and it's not too late for your business to benefit. Ian Boughton reports.

Just a few years ago, take-away speciality coffee was still something of a novelty but it's now a fixture in the high street and paper cups can be seen in the hands of numerous people every day.

The figures are astonishing. The packaging industry says that more than 70,000 tonnes of paper cups are used a year, enough for seven billion drinks. In the USA, they dispose of 25 billion polystyrene cups alone every year and if all the disposable cups passed across Dunkin' Donuts counters in a year were strung together, they would form a chain that would circle the Earth twice.

General traders in other countries have been quick to adapt to the take-away beverage culture. In Ireland, garage forecourts and corner stores became recognised for high-quality take-away coffee many years ago, long before the UK followed suit.

But in Britain, many caterers who could benefit from the take-away trade have simply not taken the opportunity.

"Good coffee used to be the preserve of high street coffee shops but we have seen a growth in the take-away coffee market from neighbourhood retailers such as Spar and Martin McColl," says Simon Bracken, sales and marketing director at Café Bar.

"These are businesses that realised they were losing out on revenue from hot beverages."

Parts of the hospitality trade are losing out as well, according to John Young, general manager at Huhtamaki, supplier of take-away cups. "Look at those hotels that have introduced lobby-based coffee carts," he points out. "This has allowed their coffee offering to appeal to a larger clientele. There is definitely an opportunity for more catering outlets to offer a take-away service."

At First Choice Coffee, managing director Elaine Higginson is surprised that restaurants and pubs have not done more in that direction.

"Business and airport hotels in particular should be tapping into the take-away coffee market as their guests will be looking for an on-the-go option," she says.

"Don't lose this revenue to a high street coffee chain."

All hospitality trade operators should observe a statistic, says Martin Lines, marketing director at Nestlé Professional.

"Currently, 57% of coffee shop customers buy drinks to take away and any caterer who does not see this is missing an obvious opportunity," he warns.

"Any catering business close to offices is likely to succeed in selling take-away hot beverages, although it's imperative to consider the peak times and to be willing to alter your opening hours if appropriate."

Cafe2U is a business that focuses entirely on take-away beverages served from a fleet of franchised vans. Operations manager Alex Dawson says he can see the spread of likely take-away locations and also the competitors who want to take the business.

"We have been trialling several concepts, all well away from the traditional beverage locations," he explains.

"Petrol forecourts have led the way, although some of their coffee still leaves a lot to be desired. Some pub companies are already competing because they see that many pubs cannot continue with just their current business."

It is a clear route for pubs but only when they stop seeing coffee as an afterthought, agrees Marco Olmi, at Drury Tea and Coffee. "Pubs will have to sharpen up their act - but they can do it," he says.

It is pubs who could increase their hot beverage sales the greatest, according to Peter Haigh, brand development manager at Tetley, which has devised the Tetley On-the-Go product.

"Now that pubs are open throughout the day, they can grab passing beverage trade in a wider way than expecting customers to come in and sit down," he explains.

Sit-in custom outside conventional pub hours drew the JD Wetherspoon pub chain into working with good coffee but it has now seen the wider picture and has trialled take-away beverages at airports, railway stations and other travel locations.

General caterers can learn the take-away trade by watching the coffee houses, says Gary McGann, sales and marketing director of Beyond the Bean.

"Caterers with a sit-down business model have the same overheads but not the same throughput," he says.

"So the question is how to extend their business - they can look at coffee bars to see just how take-away works."

There is a promotional value to moving into take-away, say the take-away cup companies. Never forget that take-away coffee is an advertisement, says Tony Waters, managing director at Solo Cup Europe. The take-away cup does not just hold coffee; it tells other people about where the drinker bought it, so the caterer who develops into a take-away trade will do well to think about the message his cups carry.

Solo Cup Europe says its cups are also an advertisement for the caterer

A big objection to the take-away trade has now been overcome, says Lucy Frankel, marketing manager at cup manufacturer Vegware.

"We have enquiries from pubs who see take-away coffee as an opportunity to increase revenue from a fixed overhead, their coffee machine, in the current climate," she explains.

"A main objection has been the environmental problem of disposable packaging, but now eco-friendly packaging is developing fast. We even make a compostable alternative to the plastic sip-through lid, so there is no reason why an operator can't promote the sustainable nature of their take-away drinks."

The take-away beverage business has been dominated by the espresso coffee trade but Chris York, sales director for Marco Beverage Systems, sees a way for hotels and eating-houses that do not have espresso machines to make a profit.

"Espresso coffee is a great drink but so is filter coffee. In our view, correctly made filter coffee is best for take-away, delivering speed of service with high profitability. It's our tip for growth in 2010 for caterers who realise the potential for good take-away coffee," he says.

Up to now, the take-away tea market has not been a success, mainly because no practical way of serving it existed - loose tea-bags in takeaway cups cause messy problems. Several tea companies have worked to put this right.

Tea To Go

"Tea consumers are often disappointed not to be able to find a take-away tea," says Heather Huene, sales manager of tea brand Hälssen & Lyon, which is beginning to market its new Tea To Go product in the UK.

"And more often than not, caterers are unaware that tea is almost six times as profitable as coffee.

We have now made the first high-grade tea take-away. Two brilliant ideas went into it - first, a tea bag with a header label instead of a string.

The customer can allow the tea to brew for as long as they like, and then pull the header, which makes the bag go into the holding chamber.

"The second idea was to use a nylon bag so that customers can see that, even in a take-away product, they're getting a premium tea. The customer no longer feels cheated. Now, far more establishments can work with take-away beverages - hotels, hospitals, universities, cruise ships and so on."

That is exactly the example PG Tips gives in support of its PG2Go product, which uses a teabag string threaded into the take-away cup lid. The company says Stena Line returned a 20% growth in tea sales with the product and increased its price per cup from £1.20 to £1.65. Birmingham University, meanwhile, has reported a 25% increase in tea sales with the product and has increased its price per cup from 75p to £1.

Take-away cup supplier Huhtamaki believes more catering outlets could offer a take-away service

CONTACTS

Beyond the Bean
0117 953 3522

Café Bar
0800 515446

Cafe2U
0845 644 4708

Drury Tea and Coffee Company 020 7740 1100

First Choice Coffee 01908 275520

Hälssen & Lyon
00 49 04036 143173

Huhtamaki
023 9251 2434

Marco Beverage Systems 020 7274 4577

Nestlé Professional 0800 742842

Solo Cup Europe
01480 459413