The coffee market is changing rapidly, as reported in my latest Quarterly Business Review….
JAB Holding Company is openly targeting Nestle with the aim of becoming the pre-eminent global coffee business. In the last quarter, it has acquired Pret a Manger to add to a growing portfolio that includes grocery brands and foodservice operators like Krispy Kreme. Meanwhile, Nestle is in the throes of reaching a deal to supply Starbucks branded coffee to the grocery sector and Costa is becoming a standalone business from Whitbread, making it a target for acquirers.
It’s a little early to predict the precise effect on the UK coffee shop market but these developments have the potential to disrupt supply and consequently, prices.
This may be good news for many operators but not for those that are beginning to struggle in a saturated market. Like the restaurant market, growth is coming at the expense of profits. There is a limit to the amount of brands that the market can sustain. The sale of Apostrophe to SOHO Coffee and Timberyard’s move into a workspace offer are examples of changes that have already occurred.
To find out more about what my Quarterly Briefing Report has to say about the state of foodservice market, give me a call on 07785 242809 or email peter@peterbackmanfs.com