£6bn coffee market remains buoyant

The UK’s coffee culture is showing continual growth, with a preference for branded offerings – particularly among younger demographics – driving the market.

With more people consuming hot beverages than a year ago, the £6.2bn coffee market is showing no signs of slowing down.[1]

University facilities managers are realising that there is a considerable amount of profit to be made by bringing the high street offering directly to campus. We provide three separate Costa propositions to meet their differing needs, ranging from the Costa full store franchise model where students can sit down and relax with friends to Proud to Serve Costa, where the Costa offer is incorporated into their catering outlet and our Costa Express proposition, where the same Costa quality coffee is available in a convenient self-serve format. Bringing a high quality, high street proposition to campus will mean that students won’t need to look elsewhere.

There is always going to be a price issue with students, but contract caterers are recognising the growing profit potential of a high quality coffee offering. Our results back this up – in a university café environment, customers reported a 25-30% uplift in coffee sales where they have replaced an unbranded coffee offering with a Costa Proud to Serve outlet.[2]

We now have a number of full stores in UK universities, plus a large number of Proud to Serve offerings.

One of Costa’s greatest achievements in the education sector to date has been the flagship store we opened up at the University of Birmingham, which has a separate area for studying. We’re now working with the team there and hope to open a further two stores there over the next five years.

Universities can be challenging locations as there are only a certain number of weeks to maximise earning potential from any catering offering. That said, demand for coffee in the UK is high, and we expect this trend to grow across all of our industries.

[1] Source: Allegra Strategies Project Café 12 UK 2013

[2] Source: Allegra Strategies Project Café 12 UK 2012

 

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