In the UK, it is estimated that consumers use between 2.5 to 5 billion disposable paper cups per year, with few of those reported as being recycled. With 76% of people who purchase hot beverages to go relying on single-use equivalents, the research reveals that more work needs to be done in order to shift consumers away from their reliance on disposable hot beverage cups.

There is a huge opportunity for takeaway hot drinks outlets to adopt simple practices to reduce the significant single-use waste produced. In the US, for example, many cafés and coffee shops offer reusable cups for sale, a discount to customers that use one, or have a cost-effective returnable cup program. Furthermore, many outlets offer seasonal reusable cups to entice consumers to buy and use them, particularly in the fourth-quarter (e.g., Starbucks signature red reusable annual holiday cup) and Earth Day (bright green cups are ubiquitous).

In 2023, to help reduce single-use waste and alter attitudes towards disposable items, more than a dozen cafés in Stirling, Scotland offer customers the option of reusable cup for to-go drinks in return for a £1 deposit. The deposit could be reclaimed at any café participating in the Ditching Disposables Stirling scheme. (Click here for the full story.)

The flexibility of returnable and reusables allow outlets to establish a concept that best suits its operations. By purchasing a given number of returnable cups, organisations can either collect a small deposit from customers, which is then refunded on return of the cup, or implement a borrow charge if the cup is not returned within a set period. According to the survey, some programs are even simpler, by trusting customers to return the cups and ensure a circular economy of reusables within the outlet.

“This survey clearly shows the opportunity on offer to forward-thinking catering outlets as they look to reduce their reliance on single-use packaging,” said Dan Dicker, CEO and founder at Circular&Co. “There’s a clear appetite for more returnable cup schemes and reusables among those buying takeaway hot drinks regularly, which gives businesses the opportunity to make significant commercial and environmental savings, all while improving their appeal to the growing number of environmentally conscious customers.”

• Vanessa L Facenda, editor, Tea & Coffee Trade Journal.
  Keep in touch via email: vanessa@bellpublishing.com Twitter: @TCTradeJournal or LinkedIn: Tea & Coffee Trade Journal

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• Recorded a 48% increase in sales in the first 3 months of the year compared to the same period in 2023;
• Has surpassed 550 locations across the country after opening 40 new locations this year, plus 9 fully renovated and 2 relocated locations;
• Has started the process of opening two new 5 to go coffee shops in Budapest, in addition to the four already present in Hungary, and is preparing to enter the Bulgarian market, where it has signed the papers for two locations.

“The current evolution of the number of locations is in line with the target set for the first part of the year: this is the pace needed to reach, or even exceed, 650 open coffee shops by December. Both locally and in neighbouring countries, we are testing the market, analysing trends and adapting our brand strategy and price positioning, where necessary, in order to respond to the specific needs of shoppers and offer them an experience that is as pleasant and close to their expectations. I am happy to see the opening of the first 5 to go locations in Bulgaria, which we have been pursuing for some time, and in Hungary the plan is to be present with ten cafes by the end of the year, if everything goes according to expectations,” said Radu Savopol, co-founder of 5 to go.

At the moment, the 5 to go network covers 120 cities in Romania, with another 35 to be added to the development map this year, and includes 280 entrepreneurs who carry forward the values of the brand and contribute significantly to massive local development by successfully managing one or more locations.

By December 2024, the company has planned to open around 120 new 5 to go coffee shops, as well as to strengthen its presence in foreign markets, where business expansion will be subject to a rigorous analysis of previous results and the specifics of each country. Moreover, realistic forecasting, adapting strategy to market developments and effective management of external factors are among the key factors behind the spectacular results achieved so far by 5 to go.

At the same time, the development of the retail division is on track, with new products being launched in the snacking area, adapted to the nutrition and lifestyle requirements of the moment, with competitive prices, attractive design and high quality ingredients, complementing the current portfolio.

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The company has Greener Stores in 44 markets with new markets including India, Hong Kong, Indonesia, Malaysia, New Zealand, Philippines, Singapore, Thailand, Taiwan, Vietnam, Bahrain, Italy, France, Spain, and Costa Rica, including the Hacienda Alsacia Visitor Center café at Starbucks first and only coffee farm.

“Our big vision for the future is for every Starbucks store around the world to be more sustainable. That’s why I’m excited to see the continued growth of Greener Stores globally, driven by the passion of our partners,” said Michael Kobori, Starbucks chief sustainability officer. “Starbucks environmental promise comes to life through our baristas’ daily actions which help define a Greener Store, our innovative shift toward reusable cups, and our partnership with coffee farmers on sustainable growing practices — it’s all part of our commitment to give more than we take from the planet.”

Since October 2022, all new Starbucks stores in Latin America and the Caribbean (LAC) are being built under the Greener Stores framework.

What’s a Greener Store?

Being certified as a Greener Store, means meeting standards across eight environmental impact areas developed in partnership with the World Wildlife Fund (WWF) and SCS Global Services: water stewardship, energy efficiency, waste diversion, renewable energy, responsible materials, engagement, sites, communities, health, and wellbeing.

Each Greener Store has a combination of sustainable features that help it receive its third-party verification. Some stores have obvious elements like solar panels or water recycling tanks. While others have more subtle features behind the counter like high efficiency appliances, low-emitting paint and sealants, and energy management systems as well as store practices like composting and food donation.

For example, in the United States, Starbucks Greener Stores practices have saved the company almost USD $60 million in annual operating costs, including 30% water savings and 30% energy reduction when compared to historic store practices.

Greener Stores of the year 

This year, the company announced its inaugural global Greener Stores of the Year programme awarding one store in each of six regions to celebrate stores exceeding in innovation and environmental impact.

Latin America and the Caribbean (LAC) – Lima, Peru  

All store partners at the Starbucks Frutales location, in the Camacho neighborhood of Lima, have completed the Greener Apron programme, a course about sustainability and practices partners can take to help reduce waste and improve their impact on the environment. “The certification on sustainable practices works on promoting getting orders in For-Here Cups, composting and also the use of reusables,” said store manager, Andrea G.

All store finishes are provided by local suppliers, including a beautiful mural by a local Peruvian artist Selva, whose art represents our “harmonious relationship with our surroundings.”

Tsushima, Japan

Built as part of a project to revitalise Tennogawa Park, the store was designed to feel at one with the outdoors with large windows allowing ample natural daylight and deep eaves to prevent glare and heat. Store partners help run an annual festival held in the park and host “community connect” events, such as park clean-ups where partners volunteer alongside residents and customers.

Since December 2023, the first Greener Store in Japan, the Imperial Palace Gaien Wadakura Fountain Park store, has been a Reuse Ambassador workshop inviting nearby store partners to learn about reusables and practices that can help their store become verified as a Greener Store.

Europe, Middle East, and Africa (EMEA) – Cesme, Türkiye

The store’s natural stone exterior helps control indoor temperature and its high-efficiency HVAC system and on-site solar provide a 15% energy savings. A rainwater harvesting system provides landscape irrigation, and landscaping consists of local plants endemic to the area.

“Winning the EMEA Greener Store of the Year title is a truly remarkable achievement, especially for someone who values environmental sustainability like myself,” said store manager Gökçe C. “The recognition of our store’s sustainable design fills me with pride and motivates me to continue contributing towards a greener future.”

North America – Williamsburg, Virginia

“I’ve always loved that Starbucks cares about the environment and reducing waste, but now that I’ve been given the opportunity to be a part of a Greener Store, I feel a greater sense of responsibility. I see even more of the meaningful change we are making as a company each day,” said store manager Madi M. who added that “for the history buffs and William and Mary Alumni that visit us to see how an old house could become a Starbucks, we love to offer For-Here cups, share about personal cups, and tell curious customers about composting or Grounds for Your Garden.”

Located in historic Williamsburg, a 100-year-old house was turned into a new Starbucks café operating on 100% local renewable electricity provided by the Fern Solar project located just under 200 miles away. In addition, the store has a rainwater collection system in place for landscape irrigation and banquettes made from recycled wood.

“Each individual person impacts the environment, and if Starbucks as a whole is taking a step towards being greener, hopefully, we can inspire others through our process,” said barista, Zach. “Every day I use a personal cup whether it’s for hot or cold drink, I make sure to always have one with me. I also encourage other partners or customers to bring in theirs to reduce the amount of waste we have with our plastic cups, paper cups, and lids. I like to remind customers about our discount with using a personal cup, and how they can benefit from using one as well.”

Asia Pacific – Ayali Kalan, Ludhiana, India

Located in Ayali Kalan, the first certified Greener Stores in India has EV chargers, a rainwater harvesting system, and distributes their used coffee grounds to be used as fertiliser in surrounding developments. The store has interactive displays raising awareness about climate change and inspiring others to embrace eco-friendly choices in their lives.  

“I’m looking forward to engaging customers to let them know we are raising awareness about climate change, and the thoughtfulness we have put behind this store to reduce its environmental footprint. This award helps us celebrate and bring this awareness to our customers,” said Pankaj, store manager from Starbucks Ayali Kalan.

Shanghai, China

The Zhao Hua Road store was renovated with 90% recycled or reusable materials used in store construction, and 75% of store operational materials are recyclable. Installing LED energy-efficient lighting, an air-cooled ice machine and heat-pump water heater has resulted in a 50% energy reduction compared to before the store renovation.

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Mexico eyes becoming one of the leading players in the global coffee market, which will take place by increasing both domestic consumption and exports.

Despite a tough economic environment, the demand for coffee and its consumption in Mexico remains strong, which is also leading to the growth of its local production.

According to the Mexican Ministry of Agriculture and Development (SADER), coffee is a strategic crop in Mexico — its production currently employs more than 500,000 producers from 15 states and 480 municipalities. In total, 94.1 percent of its coffee production is located in five provinces: Chiapas, Veracruz, Puebla, Oaxaca and Guerrero. More than 92 percent of the coffee supply comes from small producers, who grow coffee on less than two hectares.

SADER figures indicate that Chiapas is the main producing state, contributing 41.3 percent followed by Veracruz with 24.4 percent, and Oaxaca with 8.2 percent. Coffee currently represents 0.66 percent of Mexico’s national agricultural GDP (gross domestic product) and 1.34 percent of the overall production of agro-industrial goods in the country. Still, this is just the beginning, as state plans include creating conditions to increase both coffee production and consumption within the next several years.

In accordance with Mexico’s National Agricultural Planning, it is estimated that in 2030, national consumption will increase from 0.80 to 0.94 million tonnes, and that national production will expand from 0.82 to 4.7 million tonnes. Exports should also grow, which will allow Mexico to re-enter the ranks of the world’s top-ten largest coffee producers and exporters. It currently stands in eleventh place.

As for coffee retail sector, according to data presented during Expo Café 2023, the coffee industry’s main event in Mexico, the coffee sector grew by 5 percent in 2023. That was mainly due to local consumption jumping from 230,000 tonnes in 2020 to 311,000 tonnes in 2022, an increase of 37 percent. In 2023 the consumption exceeded 320,000 tonnes.

In addition to more than 500,000 producers, Mexico’s coffee sector consists of more than 75,500 coffee shops, the number of which is constantly growing.

According to analysts’ predictions, there could more than 80,000 cafeterias by the end Q1 2024, with annual growth between 5 percent and 7 percent in terms of new units, capable of employing more than 377,000 Mexicans (averaging five people per cafeteria).

In general, coffee shops are presently one of the most profitable businesses in Mexico, which attracts many domestic and foreign entrepreneurs.

Most coffee shops are concentrated in the country’s four largest cities – Mexico City (the capital), Jalisco, Guanajuato and Puebla – which all together make up about 45 percent of those establishments throughout Mexico.

Producers under pressure

Mexico is currently ranked as the ninth biggest coffee-producing country in the world (in terms of land) with the harvested area of 646,00 hectares (ha) and with a production of about 987,000 tonnes.

However, experts of the Mexican Institute of Ecology, Inecol, have recently warned that despite its coffee sector maintaining generally good results the past few years, the current tough economic situation in Mexico has put a serious pressure on Mexico’s coffee farmers, some of which may declare bankruptcy in the short-term, which is mainly due to low incomes (earning 75 percent below the national minimum wage), the lack of state support, and climate change.

Coffee shops such as Cafe Negro in the city of Coyoacan, continue to open around Mexico. Image: Mexplora

Analysts report that coffee yields in Mexico are among the lowest in Latin America (five to seven quintals per ha), which led to the country dropping from once being the fourth largest coffee producer in the world to the eleventh.

Multinationals show interest

Most independent analysts believe that despite the existing challenges, Mexico’s coffee and tea sectors recorded generally good results last year and have prospects for further growth in 2024.

According to Alberto Trueba, research & data analyst at Euromonitor International, in the case of coffee, in 2023 there was a 2 percent volume growth in the retail category on a year-on-year basis. “In general, [locals] are becoming more cautious in their spending habits. However, the desire for a delightful cup of coffee persists. Currently, more and more local people prefer to consume more coffee at home, while seeking new flavours or experiences with each cup.”

Historically, the Mexican coffee sector has been within the sphere of interests of global players. In recent years, many of them have significantly strengthened their positions in the local market, planning further expansion.

One such company is Nestlé, which remains one of the leading players in the Mexican coffee sector, providing active support to local farmers through the various local programmes, such as Nescafé Plan 2030. There are 80,000 Mexican producers who are part of the Nescafé supply chain. Through its Nescafé Plan 2030, Nestlé has been cooperating with academic and research institutions to establish better coffee plants, training for producers, and technical assistance.

Nestlé opened a new Nescafé factory in Veracruz Mexico in 2022, making Mexico Nestlé’s main coffee producer globally. Image: Nestlé

Nestlé is the number one buyer of coffee in Mexico, buying 30 percent of the national production from more than 80,000 producers. In addition, the company recently launched a number of new products across different categories such as Dolce Gusto coffee capsules with Starbucks Vanilla Madagascar and White Mocha flavours. Nescafé also introduced Nescafé Ice, a variant of its flagship product, which is the first instant coffee in Mexico designed for cold preparation.

However, Nestlé is not the only global player that is actively expanding in the Mexican market. Another is The Coca-Cola Company’s Costa Coffee, which recently introduced its new coffee machine to the market. This machine offers a level of beverage personalisation akin to what a barista would provide.

Tea: small but growing

In case of tea, in Mexico and Latin America, tea consumption has increased continuously over the last ten years, but even so, there are few people who consume this drink regularly, so the opportunities for growth and development in the industry are enormous. A significant part of local needs in tea is met by imports.

According to data from Mexico’s food title, TheFoodTech, Mexico’s annual tea imports vary from 1,200 to 1,400 tonnes, making it the second largest tea importer in Latin America, behind only Chile. The Mexican tea market is estimated at USD $79.3 million, with the possibility of reaching $98 million by 2026. The leading brands are those that are sold by large retailers. The main players are La Pastora, with 20.1 percent of the market; McCormick, with 19.4 percent; and Therbal, with 18.2 percent.

While tea consumption in Mexico is growing, it is still small as there is no tea culture in the country. Mexicans consume 12 grams of tea a year, the equivalent of six cups. By comparison, in Turkey, the country that drinks the most tea, consumption per person per year is around 3 kilograms, per Euromonitor International.

Trueba noted that there was a 0.3 percent volume growth in retail in 2023, exceeding the figures from 2022. “In terms of value, there was a 1.3 percent growth, also higher than in 2022. The slight growth of the tea category can be attributed to various factors, including health trends observed since the Covid-19 pandemic.”

Euromonitor International’s Voice of the Industry: Food and Nutrition Survey in 2023 found that 65 percent of the food and beverage companies in Mexico consider the use of natural ingredients, less processed ingredients, and additives with additional functionalities to be very or extremely influential in the coming years. This trend has significantly impacted the entire category, with particular emphasis on green tea, which experienced the highest growth in both value and volume in 2023.

Similar to the coffee category, people are increasingly consuming tea at home. Despite many individuals returning to their pre-pandemic routines of full-time work and school, they also seek to spend more time at home with family or alone,” said Trueba. “According to our Voice of the Consumer: Lifestyles Survey in 2023, 28 percent of Mexican consumers seek to spend more time taking care of themselves, often aligning with the consumption of indulgent products. This has driven the consumption of tea at home, replicating drinks from the foodservice channel.”

The importance of e-commerce

Euromonitor and other interviewed experts also anticipate e-commerce playing a supporting role in coffee and tea growth due to its inherent advantages and convenience.

Success will also depend on effective brand positioning, given the inclination of coffee and tea consumers to remain loyal to their preferred brand and their minimal tendency to switch to more affordable alternatives, driven by the paramount importance placed on taste. Consequently, social media will continue to play a pivotal role in brand-positioning campaigns.

Coffee grown in Mexico’s Oaxaca region. Image: Primera Coffee

Euromonitor also expects social media to be instrumental in promoting premium products, such as Dolce Gusto’s coffee capsules designed for cappuccino with lactose-free milk. The upward trajectory of this trend is expected to endure in the coming years, driven by the growing influence of social media in the Mexican market and its facilitation of enhancing the positioning of new or existing products.

Most analysts believe Mexico’s coffee market will continue growing in 2024, driven mainly by new product launches that focus on indulgence and convenience. The introduction of Nescafé ICE, the first instant coffee for cold preparation, and Dolce Gusto Frappé coffee capsules for homemade frappés, are part of this trend.

Regarding the tea sector, Euromonitor reports that growth will also be observed both in value and volume terms, with a 2.2 percent increase in both cases, surpassing the figures seen in 2023. These growth projections are supported by the relaunch of existing products or the introduction of new ones, where functional ingredients will play a significant role.

Health trends will continue to drive growth in the category, as tea is perceived as a healthy beverage. Brands such as Lagg’s emphasise the benefits of their wellness line on packaging, highlighting infusions like Sleeping Time and Gastro Plus.

Moreover, the growth of the category is expected to be supported by several brands promoting tea consumption in various social scenarios, emphasising an experiential aspect beyond the act of drinking tea. For instance, Twinings underscores in its advertising campaigns that its products can be consumed hot, cold, or as mocktails.

• Eugene Gerden is an international freelance writer, who specialises in covering the global coffee, tea and agricultural industries. He works for several industry titles and may be reached at gerden.eug@gmail.com.

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The evolution of the Romanian brand 5 to go is reflected in both HoReCa and retail markets, with each of these divisions recording spectacular growth over the last year. Although the global context has made 2023 a challenging year in many business areas, including the coffee sector, the 5 to go business has benefited from a winning strategy and has continued to be profitable and have a positive impact in the market through stability, consistency, innovation and constant evolution. 

“The results achieved in the last quarter of 2023, when we recorded an increase in turnover of more than 50% compared to the previous year, have exceeded our estimates and have boosted our planning for the next period and the setting of new targets in line with the pace of development we aim to maintain. The year has just started and we already have 25 new location openings and 8 renovations planned for January-February alone. Things are steadily progressing locally, with a new 5 to go location opening in Romania practically every 2 working days. At the same time, we want and believe that we have real chances to move up this year to 7th place in the European ranking of coffee shop chains, up from 9th place where we are now“, said Radu Savopol, co-founder of 5 to go. 

The retail division has evolved over the last year, reaching a share of around 4% of the group’s turnover. The recipe for development in this segment consisted in diversifying the portfolio, listing products in the major Romanian networks and a price positioning relevant to the Romanian consumer. 

Growth plans will be maintained in 2024, keeping the upward trend of business development. According to current planning, 5 to go will exceed 600 coffee shops, 50% of which are in Bucharest, followed by Brasov (30 cafés) and Cluj (15). If in 2023 the 5 to go map covered 110 cities with at least one coffee shop open, in 2024 the expansion will target at least 40 new cities. Internationally, the plan is to launch on the Slovakian market, reach the ten café milestone in Hungary and implement a pilot project on the Bulgarian market. As for the retail division, new 5 to go branded products are being considered for launch this year. 

In 2024, the development directions aim at: improving the average transaction value, which will pass 15 lei in the coming months; increasing traffic in coffee shops and developing private label products dedicated to the retail segment. Strengthening the range and listing in new networks, together with the development of the team managing this retail segment could bring the 5 to go group a 10-fold increase in turnover in this segment over the next 5 years, reaching an estimated potential of €20 million. 

Closer to consumers: 5 to go app to be launched in the first half of this year 

Part of the strategy to keep up with market trends and customer needs in the digital age, the 5 to go app is 90% ready for launch and will be available this spring to facilitate access to the brand’s universe and positive consumer experiences. 

“We want to become more visible to our customers and improve our communication through a common language, and we believe that one of the ways to keep them permanently connected with the brand is an interactive, intuitive and cool app that they can always have at their fingertips, providing them with hot information about 5 to go’s product portfolio and preferred or nearby locations and their schedule, seasonal news or recently opened cafes. In addition, we will have a surprise consumer reward system, which will help us attract new customers and maintain their loyalty in the long term,” explained Lucian Bădilă, co-founder of 5 to go. 

The 5 to go brand has invested in communicating with the customers, developing campaigns and offers that meet their needs and desires. This is reflected in the reasons why they choose 5 to go products, with product quality (52%), taste (40%), proximity (38%) and brand preference (37%) ranking highest, according to the latest research by Reveal Marketing Research. 

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As cliché as it is, humans are creatures of habit, and when our habits were so dramatically altered by the Covid-19 outbreak, we reached for the things we knew, the things we could control, to emulate a semblance of stability. There is a reason we re-watch our favourite films or TV shows, re-read books over and over: we are comforted by the familiarity and the predictability.

As soon as cafés were allowed to offer takeaway coffee, a glimmer of normality returned, and we flocked to their doors in an attempt to capture that mimicry of routine once more. We all remember looking forward to the one trip outside that we were allowed each day. And for so many, this took the form of a walk to grab a coffee to-go from their local café or coffee shop. Not only did it hail back to normal times, but it was a chance for human interaction – seeing ‘real people’ aside from your dog or your long-suffering partner.

At the Specialty Coffee Association’s (SCA) Virtual Coffee Retail Summit in February, Jessica Warden, head of coffee at Gail’s, spoke of the newly essential role their baristas had to play during this time, that the exchange between customer and barista became even more important. For many, it may have been their only social interaction of the day and for most, it served as a chance to get out of the house and recalibrate with the outside world. Coffee, and more importantly, coffee shops, throughout the pandemic, remained an integral part of people’s lives, just in a rather different format.

It was during this time that Pret a Manger launched its subscription service: up to five barista-made beverages a day for £25 a month. This proved a popular scheme, encouraging its customers to make the effort to visit, if only to get the most out of their subscription. One of my closest friends and her housemates would walk to Pret daily – even though it was a forty-minute walk from their house – to feel like they had achieved something with their day, gone somewhere and done something at a time when this was a luxury.

Pret also opened to sit in before a lot of other places, socially distanced and one household to a table of course, where you could go and work or study. The return of indoor dining offered different walls to stare at, and a constant volley of people, which, despite not really being able to interact with, at least they were people and a reminder that life continued.

Instant coffee, was, and still is, widely consumed in the United Kingdom, but specialty coffee is on the uptake and has been for some time. Previously, most people were satisfied with their instant coffee at home and would enjoy a barista style coffee on their way to work or from their fancy office coffee machine, if they were lucky. But during lockdown, when a trip to the coffee shop became the focal point of the day, and time felt so endless that people picked up hobbies like sourdough cultivation and crocheting, the coffee-minded among us delved into the world of specialty coffee at home. They invested in coffee machines and experimented with more unusual and premium blends, no longer satisfied with anything but the high-quality coffee that was the spoils of their lockdown coffee-shop pilgrimages. This was expediated by social media such as the Dalgona coffee TikTok trend that saw people whipping instant coffee, sugar, and water together and adding it to hot or cold milk to create a cloud-like coffee concoction. People were using social media to learn how to do many things – like learning to knit a cardigan – and many were also using it to learn how to make specialty coffee.

Now that society has mostly re-opened, our evolved preference for specialty coffee has lingered and whilst many can achieve this at home, coffee shops have not lost their unshakeable attraction as a segment of our routine and a respite from what was a too empty life in lockdown, to a once more, busy life doing whatever it was we used to do in 2019.

• Kathryn Brand, Bell Publishing editorial assistant
  Keep in touch via email: kathryn@bellpublishing.com 
  Twitter: @TCTradeJournal or LinkedIn: Tea & Coffee Trade Journal

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Impacted heavily by the sudden closure of public spaces and waves of restrictions on indoor dining, foodservice companies around the world have been scrambling to adjust to a continuously changing environment while patiently awaiting normalcy and the hopes of re-emerging intact as the global pandemic recedes.

For Los Angeles, California-based The Coffee Bean & Tea Leaf (CBTL) – a global roaster, retailer of specialty coffees and teas, and established café beverage innovator – that corner may have just been turned. Parent company, Jollibee Foods Corporation (JFC) of Manilla, Philippines announced last month a surging return to profitability in its 2021 fourth quarter operating income, citing CBTL’s 29.3 per cent jump in 2021 same-store sales as a major contributing factor.

That certainly must come as welcome news to Sanjiv Razdan, CBTL’s president of Americas and India, who was hired in May 2021 to energise growth at the iconic company’s US-based business unit.

Sanjiv Razdan, CBTL’s president of Americas and India

Founded in Los Angeles in 1963, CBTL– having grown to over 1,100 retail stores in 27 different countries – was purchased by the Filipino restaurant group in 2019 in a deal valued at USD$350million, the company’s largest and most multinational acquisition to date. Jollibee’s priority was to accelerate growth of the coffee and tea brand and strengthen its brand development and franchise support system, particularly in Asia, where most of its stores are located. But with the appointment of Razdan, growing CBTL’s North American market has been shifted into high gear.

“Jollibee is very well resourced and that has given us access to capital and investments which are so important for growing our business,” Razdan explained.

With three decades of experience leading numerous US restaurant chains, Razdan has brought a new perspective in efforts to grow the coffee chain, not afraid to do things differently when appropriate. CBTL’s core strengths have traditionally been sourcing top quality coffee beans and signature tea varietals, small-batch roasting practices, and a spirit of innovation, having pioneered frozen blended coffee drinks and chai lattes. Those principals remain unchanged.

But Razdan did promptly bolster his senior leadership team by hiring three experts in marketing, consumer packaged goods, franchise development, and digital technology innovation, to help drive his growth plans.

“For the American business that I oversee, we have approximately 250 cafés,” Razdan said recently from CBTL’s Hollywood (LA), California offices. “We’re an omni-channel business. I envision over the next three years, by the end of 2024, to add anywhere between 100 to 150 more locations, so we’re looking at pretty aggressive growth numbers.” Razdan explained “omni-channel” as any of the various ways a consumer could purchase a product that originates from one of CBTL’s stores—in person, drive-through, online, by app, or by delivery.

In North America, approximately 60 per cent of CBTL’s brick and mortar cafés are company owned, concentrated in Southern California and Arizona, while the other 40 per cent are franchise owned. According to Razdan, the strategy is to grow through both channels, but be a franchise-led growth engine going forward.

“There’s plenty more room for us to grow in southern California and Arizona,” he shared, with Arizona’s major cities of Phoenix, Scottsdale, and Tucson targeted for additional company stores. Outside of those markets, the business is all franchise, and CBTL is focusing particular attention on Portland, Oregon; Dallas, Houston, and Austin, Texas; and Chicago, Illinois, as high-growth opportunities. The company is also looking to build its presence in New York, where it currently has one store in Brooklyn and will soon be adding a second city café. [CBTL had exited the New York City market prior to the pandemic.]

The locations of CBTL’s brick and mortar stores “run the gamut,” said Razdan, with about one-fifth offering drive-throughs. “We’ve got a lot of in-lines, stand-alones, and endcaps,” he noted. “If you clustered all of them, that’s where the bulk of our estate is. And then we’ve got a significant number of stores in non-traditional locations,” which has helped direct strategy for future selections.

The chain has done well with airport cafés so it’s an area CBTL is focusing on. “We would love to continue to grow in airports around the country,” said Razdan, adding that another successful location for CBTL is universities/colleges.

CBTL actively targets coffee (right) and tea drinkers with its on-premise and at-home selections

Razdan said about 95 per cent of CBTL’s sales come from its brick-and-mortar stores, the balance consisting of grocery and e-commerce, both of which have grown “significantly year-on-year. In fact, we’ve had record growth because of at-home consumption, people investing in fancier machines to brew coffee and tea, and they’re just consuming much more,” he explained.

“Grocery’s growing and we continue to be present in more grocery stores, both brands and the number of locations,” which includes dozens of major national U.S. retail chains. “E-commerce also continues to grow for us,” Razdan added, “but brick and mortar will, just because of its shear size and legacy, continue to remain the dominant force.”

Among major coffee chains, CBTL is notable in prominently featuring tea, and affording it an integral position in its menu development. “A lot of our beverages are consumed by our customers in coffee and tea form,” said Razdan, citing chai lattes vs traditional espresso lattes; cold brew coffee vs its innovative peach jasmine or mango cold brew teas. “When we think about core beverage innovation, we’re constantly thinking about applying that across tea and coffee, which is what makes us unique [among] our other competitors.”

Shifting behaviour

Even before pandemic protocols closed eateries and created major shifts in consumption patterns, Razdan said it was clear that consumer behaviour was already shifting. He believes many of the consumer adjustments made during the pandemic are here to stay.

“Drive-throughs are really one of our go-forward growth engines. They do exceedingly well for us wherever we have them,” Razdan explains, noting they have now become the preferred channel for a lot of consumers. “This asset type is booming for us, and we’re definitely doubling down on growing our drive-through footprint.” While current retail stores all have sit-down cafés, Razdan is looking to include drive-through-only assets in CBTL’s growth plans and, for urban locations, walk-up-only assets focusing on grab-and-go transactions.

Considering sit-down seating as an optional feature came as a result of observing trends at existing stores, said Razdan. “We’re finding that the vast majority of guests are accessing [our stores] through the drive-through channel. If that’s what is happening…then we may as well optimise the asset for drive-through and offer a great experience there.” By reducing the footprint and capital investment, he notes, it’s also easier to find sites that lend themselves to drive-through only locations.

While pandemic protocols forced food service operators to adjust their operations, Razdan said the trend towards increased off-premise and on-the-go consumption had already been growing beforehand. “The tailwinds have been there for a few years. But in the last couple of years, thanks to the pandemic, those tailwinds have become significantly stronger. People have been left reticent about coming inside the café.” Razdan said the company is essentially meeting consumer needs wherever they are.

Pandemic’s lasting impact

Some of CBTL’s pivoting during the pandemic has now become a blueprint on where to invest resources going forward. Razdan believes some of those altered consumer behaviours won’t be returning any time soon, maybe ever, to their pre-pandemic norms.
“I think this whole notion of coffee shops being the ‘third place’ is really shifting permanently to the ‘third place’ becoming a spot on your mobile device,” he said of the well-known paradigm that coffee shops are neither home nor work, but a ‘third’ gathering spot where people meet, sit, and dwell. But consumers are increasingly accessing the coffee category through mobile devices, said Razdan, and he doesn’t see that pivoting back.

CBTL plans to aggressively expand drive-throughs, such as this Long Beach, California location

“Convenience is now shifting what used to be the whole notion of third place,” he continued, noting that the coffee experience is increasingly convenience driven. “We are very much committed to being in that space from here on. It’s just the way consumers have permanently shifted, I think.”

As a result, CBTL has focused much more heavily on its digital and off-premise channel than it had in the past.

A second trend Razdan believes is here to stay is consumers accessing coffee through delivery, which he finds downright amusing. “There was [always] a lot of usage of delivery across the foodservice category, but not coffee. We’ve doubled down on that because of the pandemic, but again, I think that is a permanent shift,” he says. “People have discovered that it’s a very convenient and easy way of accessing the beverage that they like, and we don’t see that going away, so we will stay the course.”

In conjunction with the shift to off-premise consumption, CBTL has also found that consumers are drinking increasingly more cold beverages than they used to, and the number of beverages people are ordering is significantly higher. “Seven out of ten beverages that we sell in the US now are cold vs. hot,” Razdan revealed. “As we connected these two dots, it became very clear that we basically had to meet customers where they were. With the pandemic, the delivery channel became very important.”

Now, CBTL offers delivery in two ways: either through the company’s native app and native Coffee Bean website, or through any four of the delivery aggregators that the company has partnered with: Uber Eats, Postmates, GrubHub, and DoorDash. “Essentially that’s been part of our strategy, to make it really easy for consumers to access us on delivery,” said Razdan. “That has become an important part of a business. It just keeps growing.”

A third pandemic takeaway has been the normalisation of app usage by consumers for a myriad of purposes. Razdan said people that were not habitually using apps to order ahead or to participate in loyalty programmes have now grown accustomed to the process, some having even ordered groceries online. As a result, the company has focused intently on improving its app, identifying ‘friction points’ and making it easier to use. In addition, it is currently in the process of overhauling its loyalty program. “That’s an important space for us,” shared Razdan. “We will be committed to growing that permanently.”
While embracing technology provides a framework to effectively deliver a smooth consumer experience, CBTL remains committed to innovating enticing, high quality beverages, merchandise and increasingly, food.

In tandem with shifts towards off-premise consumption, CBTL saw that many people want to order a bite to eat along with their beverage, so they’ve really made a big effort to focus on their food offerings. “As a result, we’re selling a lot more food,” said Razdan. “In fact, almost all delivery orders have some kind of add-on, either a pastry, or a breakfast wrap, or sandwich. This is something that we’re being so much more mindful of.” As a result, CBTL just launched a whole new breakfast menu in January in its California stores, “it’s definitely something that we’ve done differently,” Razdan said.

• E Edward ‘Ted’ Hoyt has more than two decades of experience as a trade magazine editor and freelance writer, authoring many articles in the premium coffee, spirits and cigar industries, among others.

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In a recent study, home advice site Simple Ghar analysed the average closing times of cafés (as well as of restaurants and bars/clubs) for major cities around the globe. They then ranked them to reveal the cities with the latest closing hours.

The chart reveals the 50 cities where cafés stay open the latest, with Cairo, Egypt and Belgrade, Serbia topping the list. Quite intriguing, and surprising, are three cities in India that rank low for having late open hours overall but are in the top ten for late-night cafés – Hyderabad, Mumbai, and Chennai – which all have average closing times between 10 and 11pm (22:00 & 23:00). According to SimpleGhar, the café culture is booming in India with the rise of the youth and middle classes set against a backdrop of low alcohol consumption.

Cairo is the city with the latest ‘late-night action’, with an average closing time of 12:26am (00:26) — four hours later than the average global closing time. The café culture there, evidently, has existed since the 16^th century, and the tea is always served the same way: hot, very black, and very sweet.

SimpleGhar finds that the Egyptian capital has the world’s latest opening cafés and second-latest restaurants. On aggregate, that makes Cairo the latest-opening city in the world. Lonely Planet reports that the climate and culture of the city have made late-opening the norm, with shops often open until midnight and entertainment lasting until dawn.

While Zagreb, Croatia is the 42^nd latest-opening city per SimpleGhar’s overall list, it ranks thirteenth for cafés with an average closing time of 10 to 10 (22:00).

The SimpleGhar study finds that the top twenty cities with the latest closing times for cafés are:

1. Cairo, Egypt (closing time: 00:26)
2. Belgrade, Serbia (closing time: 23:23)
3. Karachi, Pakistan (closing time: 23:22)
4. Athens, Greece (closing time: 22:58)
5. Hyderabad, India (closing time: 22:56)
6. Istanbul, Turkey (closing time: 22:46)
7. Mumbai, India (closing time: 22:37)
8. Dubai, United Arab Emirates (closing time: 22:36)
9. Chennai, India (closing time: 22:06)
10. Moscow, Russia (closing time: 21:59)
11. Seoul, South Korea (closing time: 21:53)
12. Jakarta, Indonesia (closing time: 21:49)
13. Zagreb, Croatia (closing time: 21:48)
14. Madrid, Spain (closing time: 21:41
15. Bengaluru/Bangalore, India (closing time: 21:36)
16. New Delhi, India (closing time: 21:33)
17. Minsk, Belarus (closing time: 21:33)
18. Havana, Cuba (closing time: 21:29
19. Kyiv, Ukraine (closing time: 21:27)
20. Montevideo, Uruguay (closing time: 21:20)

According to SimpleGhar, closing times for cafés (including coffee shops) and restaurants were gathered from OpenStreetMap (closing times for bars and clubs were taken from the first four pages of ‘Bars & Clubs’ and ‘Dance Clubs & Discos’ listings in each city’s TripAdvisor Nightlife section). In instances where the opening hours varied based on days of the week or months/seasons of the year, closing times were averaged across all the times available for each establishment. The city rankings were compiled based on the score assigned to each city based on how late, on average, bars & clubs, restaurants, and cafés close.

Now that international travel has resumed, I am trying to decide which city on the list to visit first, but there are so many great choices…

For the list of all 50 cities where cafés stay open the latest, as well as the full report on ‘sleepless cities’ and the study’s methodology, visit: simpleghar.com/which-city-in-the-world-truly-never-sleeps.

• Vanessa L Facenda, editor, Tea & Coffee Trade Journal.
  Keep in touch via email: vanessa@bellpublishing.com Twitter: @TCTradeJournal or LinkedIn: Tea & Coffee Trade Journal.

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So, it’s no wonder realtors might want to highlight the best and worst cities in the US for coffee drinkers. Hence, in its Best Coffee Cities in America 2022 report, Clever Real Estate analysed publicly available data from the US Census, Bureau of Economic Analysis, Numbeo, Google Trends, National Coffee Association, and Database USA to rank the 50 most populous metro areas in the United States from the best to the worst cities for coffee.

The weighted rankings evaluated various criteria such as:

• 3x: The average price of a cappuccino in each city.
• 2x: The average number of coffee shops per capita in each metro.
• 1x: The number of coffee shops per square mile in each metro.
• 1x: What percentage of their income locals are willing to spend on a daily weekday cup.
• 1x: The Google search trends for coffee-related terms in each metro.

The real estate firm’s rankings consider two measures of affordability: metros with an affordable cost of living encourage residents to open shops and try new ideas with lower risk; while higher-than-average prices for a cup of coffee reflect just how much residents value a quality cup.

The report reveals that the 15 best coffee cities have an average of 18 coffee shops per 100,000 people — five more than the national average of 13. According to the report, Milwaukee, Wisconsin – quite surprisingly – is the coffee capital of the US. The average cappuccino costs only USD $3.56 in Milwaukee, where residents spend 1.5% of their annual income on their weekday cup.

Conversely, the worst city in America for coffee, according to the report, is Virginia Beach, Virginia with just eight coffee shops per 100,000 residents and only 33% as many Google searches for coffee over the last year compared to the most passionate metros. A daily cappuccino costs Virginia Beach residents $5.39. Portland, Oregon has the most coffee shops per capita averaging 27 per 100,000 people.

Overall, the report finds that the best regions for coffee drinkers are the North and West as six of the top 15 cities for coffee (40%) are on the West Coast, while 10 (67%) are located North and Northeast. The top 20 Cities in America for coffee per Clever’s findings are:

1. Milwaukee, Wisconsin
2. Portland, Oregon
3. San Francisco, California
4. Buffalo, New York
5. Providence, Rhode Island
6. Boston, Massachusetts
7. Cincinnati, Ohio
8. Pittsburgh, Pennsylvania
9. Seattle, Washington
10. Hartford, Connecticut
11. Riverside, Calif.
12. San Diego, Calif.
13. Philadelphia, Penn.
14. San Jose, Calif.
15. Indianapolis, Indiana
16. Chicago, Illinois
17. New York, NY
18. Columbus, Ohio
19. Los Angeles, Calif.
20. Cleveland, Ohio

It is quite curious that Milwaukee and Buffalo rank in the top four for best cities and Ohio boasts three cities on the list, while Seattle, although within the top ten cities, is not higher on the list. And even coffee-loving New Orleans, Louisiana – which reportedly created the concept of the ‘coffee break’ – does not fall within the top 20 cities on the list.

Of course, for every ‘best’ there’s a ‘worst’, and the ten worst coffee cities in the US – that is, distinctively less inviting to café-goers – as noted in the report, are:

1. Virginia Beach, Virginia
2. Memphis, Tennessee
3. Louisville, Kentucky
4. Birmingham, Alabama
5. Las Vegas, Nevada
6. Richmond, Virginia
7. Phoenix, Arizona
8. Nashville, Tennessee
9. Jacksonville, Florida
10. St. Louis, Missouri

Per Clever, these metro areas offer an average of only ten coffee shops per 100,000 people – 44% less than the top 15 cities. Additionally, these cities have much higher cappuccino prices as a percent of annual income, averaging 2.29% compared with 1.60% for the top 15 cities. Virginia may be ‘for lovers’ as the state slogan used to say, but apparently it’s not for ‘coffee lovers’ as two of its cities fall on the worst list!

So, for those coffeehouse loyalists, the report might be worth a glance before considering a move to a new city…The full report can be viewed here.

• Vanessa L Facenda, editor, Tea & Coffee Trade Journal.
  Keep in touch via email: vanessa@bellpublishing.com Twitter: @TCTradeJournal or LinkedIn: Tea & Coffee Trade Journal.

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For example, Florida has three cities in the top 20 list, while California has five cities.

New Orleans, Louisiana, where the Specialty Coffee Association is holding its 2021 Specialty Coffee Expo, is number 15 on the list, while Boston, Massachusetts, where the Expo is being held in 2022, is 10th.

Not surprising in the least, Portland, Oregon, where the Expo would have been held last year, is the top coffee city on the list.

To determine the best local coffee scenes in America, WalletHub compared the 100 largest cities across 12 key indicators of a strong coffee culture. The data set ranges from coffee shops/coffeehouses and cafés per capita to the average price per pack of coffee.

According to WalletHub, 2021’s list of the top 20 cities in the US for ‘coffee lovers’ includes:

1. Portland, Oregon
2. San Francisco, California
3. Seattle, Washington
4. Orlando, Florida
5. Pittsburgh, Pennsylvania
6. Honolulu, Hawaii
7. Tampa, Florida
8. Miami, Florida
9. San Diego, California
10. Boston, Massachusetts
11. Minneapolis, Minnesota
12. Los Angeles, California
13. Denver, Colorado
14. Long Beach, California
15. New Orleans, Louisiana
16. Oakland, California
17. Jersey City, New Jersey
18. Washington, DC
19. Irvine, California
20. New York, New York

WalletHub also featured ‘best vs worst’ in terms of pricing, spending, number of coffee outlets, etc. Per the report:

• Kansas City, Missouri, has the lowest average price for a cup of coffee, USD $3.44, which is 2.5 times lower than in Honolulu, Hawaii, the city with the highest at $8.69.
• Fremont, California, has the highest average annual spending on coffee per household, $229.62, which is 3.5 times higher than in Hialeah, Florida, the city with the lowest at $65.06.
• Gilbert, Arizona, has the highest share of households that own a single-cup/pod-brewing coffee maker, 28.11 per cent, which is 2.6 times higher than in Hialeah, Florida, the city with the lowest at 10.93 per cent.
• Orlando, Florida, has the most coffee shops, coffeehouses and cafés (per square root of population), 0.4529, which is 8.2 times more than in Laredo, Texas, the city with the fewest at 0.0550.
• Portland, Oregon, has the most coffee and tea manufacturers (per square root of population), 0.0211, which is 42.2 times more than in Riverside and San Bernardino, California, the cities with the fewest at 0.0005.

To view the full report and other cities’ rankings, visit: wallethub.com/edu/best-cities-for-coffee-lovers/23739 or here for a YouTube video summarising the study.

Just a reminder that presentations from our 2021 Virtual Tea & Coffee World Cup are still available. Visit www.tcworldcup.com for access and more information.

• Vanessa L Facenda, editor, Tea & Coffee Trade Journal.
  Keep in touch via email: vanessa@bellpublishing.com
  Twitter: @TCTradeJournal or LinkedIn: Tea & Coffee Trade Journal.

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“Inspire Brands’ acquisition of Dunkin’ Brands will shift the industry’s focus from competition between individual brands to competition between multi-brand owners,” said Alex Jarman, research analyst at London-based global market research firm, Euromonitor International. With Dunkin’ in its portfolio, Inspire will become the second-largest restaurant operator in the United States. Some of its closest competitors will become Yum! Brands and Restaurant Brands International. “Similar to travel groups such as Hilton or IAG, a multi-branded structure allows the use of the most successful parts of each business to grow the entire portfolio,” he said. “Scale is key for this growth strategy and by adding Dunkin’ to its portfolio, Inspire has given all of its brands strong growth potential.”

Commenting on the merger, Dave Hoffmann, CEO of Canton, Massachusetts-based Dunkin’ Brands, said, “[This merger] is a testament to our world-class group of franchisees, licensees, employees, and suppliers who have worked together to transform Dunkin’ and Baskin-Robbins into modern, relevant brands…I am particularly proud of our actions since March of this year. During the global pandemic, we have stood tall. We’ve had each other’s backs and are now stronger than ever. We are excited to bring meaningful value to shareholders who have been with us on this journey and believe that Inspire Brands, a preeminent operator of franchised restaurant concepts, will continue to drive growth for our franchisees while remaining true to all that is unique and special about the Dunkin’ and Baskin-Robbins brands.”

But like many foodservice companies this year, Dunkin’ has struggled during the pandemic. According to Jarman, one of the most immediate benefits of the deal will be the sharing of customer, sales and loyalty data between Inspire and Dunkin’ because this information will be critical to Dunkin’s future success as it continues to navigate consumers’ changing habits due to the pandemic. “Dunkin’s sales suffered earlier this year as many consumers stopped picking up coffee on their morning commute,” he said. “Having access to consumer data from Inspire’s other brands will help Dunkin understand how to reach consumers beyond breakfast and the morning commute.”

In 2018, Dunkin’ Brands announced that Dunkin’ was officially dropping ‘Donuts’ from its name, officially becoming Dunkin’ in January 2019. When announcing the new moniker, the company said, “The name change is one of many steps Dunkin’ is taking to transform itself into the premier beverage-led, on-the-go brand.”

Dunkin’ has had the tagline “America Runs on Dunkin’” for many years despite it not being a true national brand. Dunkin’ continues to open stores throughout the US, but the roll out has been slow. Jarman noted that the digital boost Inspire has given its other brands may help Dunkin’ expand beyond its East Coast stronghold and pose stronger competition against Starbucks in other parts of the country. “Conversely, acquiring Dunkin’ will give Inspire’s international prospects a significant boost. More than 40% of Dunkin’s stores are outside the US and data from those locations could help Inspire further expand its existing brands internationally or even acquire brands based outside the US.”

It will be interesting to see if (and when) Inspire does ramp up Dunkin’s store openings, where they will be – in the US or internationally (or simultaneously) – and what the store concepts will be: regular store formats, smaller footprint units, joint locations with Baskin-Robbins, or a combination of all three.

• Vanessa L Facenda, editor, Tea & Coffee Trade Journal.
  Keep in touch via email: vanessa@bellpublishing.com
  Twitter: @TCTradeJournal or LinkedIn: Tea & Coffee Trade Journal.

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Many local coffee shops/chains throughout NYC closed when the stay-at-home directive was enacted in March. However, one nearby coffeehouse remained open during the Covid-19 pandemic, with baristas wearing gloves and masks and allowing one to two customers in the store at the same time — credit cards and cash were both accepted. Most Dunkin’ outlets remained open with limited hours. Starbucks Coffee initially reduced store hours but by the end of March, all NYC locations were closed (nationwide, drive-thru locations remained open). By April, several Starbucks located by hospitals within NYC reopened with orders being placed by mobile app only and with limited hours. In May, more Starbucks stores reopened, again mobile orders only and with limited hours.

However, beginning the first week of June, Starbucks customers in NYC (and maybe in other US and international cities as well) could order their beverages in person (one customer allowed into the store at a time, but only about three feet into the store as there are barriers preventing full access) and pay via app, credit card or cash. Several of the baristas I spoke with expressed some concerns about handling people’s phones, credit cards and especially cash (all were wearing protective masks and gloves). It is a valid concern, however, grocery stores, pharmacies and many restaurants have been accepting credit cards and cash throughout the entire pandemic.

Within the foodservice channel, sanitation and separation are critical during the Covid-19 and moving forward. Foodservice-focused market researcher Datassential reports that creating a dedicated pick-up area saves customers the stress of having to navigate their biggest worry: other customers. “This has been the one of the most successful strategies for operators.”

In a recent One Table survey, Datassential asked foodservice operators, “During the Covid-19 restrictions, what is working well with your current takeout and delivery system (among restaurants offering takeout or delivery)? Of those polled:

53% — are implementing increased sanitation practices

51% — are creating separate pick-up area

36% — are maintaining social distancing between staff

36% — are setting up a system to create distance between customers

22% — were/are transitioning to online ordering

19% — are adding tamper-proof seals/measures

18% —are transitioning to using third-party apps for ordering

15% — are switching to new packaging that is easier to sanitize/safer and/or reheat

10% — are using tools to make forecasting number and type of orders easier

Gloves, masks, and safety training will be the new normal for the time being. Foodservice operators around the world are adapting to this new normal and are ready to make the changes necessary to keep employees and customers safe. In its survey, Datassential also asked foodservice operators, “Are you planning to implement any of the following safety measures to protect employees?” Per the respondents:

80% — are providing employees gloves

79% — are providing employees masks

56% — are adding additional employee safety training

53% — are instituting social distancing within the workspace

46% — are daily employee temperature checks

39% — are installing clear coverings at registers to provide a barrier

While foodservice operators seem to be more than willing to do what is necessary to protect employees (and customers), some new strategies might be less permanent and more so temporary. For example, although many restaurants, cafés and coffee shops are offering free delivery today, its long-term viability doubtful (per Datassential, this is especially true for full-service restaurants, many of whom didn’t have a strong delivery presence in place before Covid-19):

44% — are offering free delivery

56% — are not offering free delivery

Among those currently offering free delivery:

50% — say free delivery is sustainable

50% — say free delivery is not sustainable

For many foodservice operators, curbside pick-up is new, and according to Datassential, it is here to stay. “Almost all operators had infrastructure for some kind of take-out, but curbside’s safety benefits have made it the hot option for pick-up in the time of social distancing. Most operators who have added it plan to keep the option.”

Datassential’s survey found that 54% are offering order ahead and pick-up curbside as a new service (76% offering as new or existing service) and 66% will continue offering when restrictions are lifted (of those who started offering as a new service). See statistics in the image above.

What strategies are here to stay, and which are temporary, remains to be seen. I am certain though, as more coffee shops, cafés and restaurants reopen with new safety and social distancing measures in place, lines and wait times will be longer, so patience will be key.

• Vanessa L Facenda, editor, Tea & Coffee Trade Journal.
  Keep in touch via email: vanessa@bellpublishing.com
  Twitter: @TCTradeJournal or LinkedIn: Tea & Coffee Trade Journal.

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The 2020 Square x SCA Coffee report outlines the current state of the specialty coffee industry (in the US — hopefully a UK- and/or EU-based report will be forthcoming) and includes insights into new trends and ways of doing business emerging as the Covid-19 pandemic continues to unfold. (Per the SCA, millions of anonymised transactions collected in coffee shops across the US were used to compile this report. All data is reflective of US Square coffee sellers as of May 2020.)

“Specialty coffee businesses across the country are evolving their efforts to serve communities and generate revenue during this unprecedented time. Amazingly, three in four Square coffee sellers have been able to continue operating during shelter-in-place, finding ways to adapt to their new circumstances,” said Peter Giuliano, the SCA’s chief research officer.

As specialty coffee businesses continue to evolve, the report reveals an increase in delivery and pickup/takeaway options (many coffeehouses require mobile orders or online orders only). The report also finds more cashless transactions taking place. Key findings from the report include:

• 5,380% increase in combined sales across curbside and/or pickup orders;
• 26% of coffee shops were cashless (did not process any cash transactions) by late April, up from 2% in early March;
• 109% increase in coffee subscription sales among coffee shops that have remained active during the pandemic;
• 400% increase in the number of Square coffee shops offering healthcare donations;
• 806% increase in healthcare donation sales (i.e., buying coffee for a healthcare worker) since shelter-in-place;
• A recent surge in grocery-style sales at Square coffee shops; the percentages below indicate the increase in number of merchants selling each item, followed by median price per item:
  · Paper towels: 1,400% increase, USD $2.00
  · Carton of almond milk: 1,100% increase, USD $5.00
  · Family meal: 1,100% increase, USD $23.95
  · A dozen eggs: 850% increase, USD $4.00
  · Toilet paper: 711% increase, USD $1.50.

The number of coffee shops donating or selling healthcare-donation-related items is not surprising in the least – the coffee industry is a highly philanthropic one – our website has been filled with stories about coffee shops’ efforts to support frontline/essential workers since March.

Commenting on the report’s findings, Giuliano added, “This shows tremendous resilience and creativity, from curbside coffee pickup to grocery store-style sales, home delivery to expanded eCommerce. These trends seem to represent more than a brief moment in time — they likely indicate a greater transformation of the specialty coffee industry and a new way that coffee shops work within the communities they serve.”

Coincidently, in T&CTJ’s June issue, Emily McIntyre, in her “Unfiltered” column, discusses being “resilient in a crisis.” In the piece, she quotes Verne Harnish, author of Scaling Up, whose webinar she attended mid-April, who said, “If you are practicing the same business model as thirty days ago — you will fail.”

The ability of so many coffee shops, in the US and globally, to not only acclimate quickly to operating amid the Covid-19 crisis, but also adapt their business models to survive, shows their strength and resiliency, which bodes well for the future of the specialty coffee industry.

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Silk has a division of products used in coffee shops around the country called the Silk Barista Collection. From 15 May, the public can help support five local coffee shops – and give the gift of coffee to a friend – with Silk Barista Collection’s “Silk Coffee Date Giveaway”.

Entrants must follow @SilkBaristaCollection on Instagram and tag a friend in the comments with whom they’d like to have a virtual coffee date, using the hashtag #SilkCoffeeDateGiveaway.

The first 375 qualifying consumers will be selected to receive a bag of coffee from a Colorado roaster – and one for their friend.

Silk Barista Collection is supporting the following local roasters: Sweet Bloom, Middle State, Amethyst, Huckleberry, and Boxcar. The brand has committed to gift $15,000 worth of coffee, with all funds going directly to the shops.

In addition to its support of local roasters, Danone North America is also working to support the coffee community with a new project that partners with baristas to collaborate and receive design & branding input.

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Each episode is 30-35 minutes long and features insights on improving marketing to recruiting and training staff; and from making a sustainable business to improving supply chains.

Alongside practical advice, champion baristas will spill the beans on everything from the classic mistakes they made to the real grind that saw them grow their business and win awards.

Maxwell Colonna-Dashwood, an independent coffee entrepreneur, three-time UK barista champion, and a guest on episode one said: “Bean There Done That is a fantastic, first of its kind initiative from iZettle to provide busy coffee shop owners with one destination where they can hear industry advice and trends.

“Most coffee shop owners are short of time, and this series allows them to learn without having to stop running their business.”

Edward Hallett, managing director at iZettle UK, said: “iZettle provides thousands of coffee shop owners with tools that help them run their business more efficiently.

“We’ve created Bean There, Done That to bring practical business advice to coffee shop owners from key figures in the UK coffee industry, that hopefully will help them further develop, grow and scale their businesses.”

The six-part series is available to download on iTunes, Spotify and all major podcast platforms. The first three episodes are available now with episodes four, five, and six released in the coming weeks.

To listen to the podcasts visit: https://blog.izettle.com/gb/podcast

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