Following the retail shockwaves of the last decade, coffee shops and cafés are taking up the capacity on the UK high street vacated by failing banks, pubs and clothes retailers. Produce Business UK considers how capitalising on the potential for pairing fruit and vegetable snacks and juices with consumer favourite, coffee, could drive further demand for the fresh produce industry
Once thought of by Brits as a posh alternative to breakfast tea or a strictly after-dinner activity, coffee is so on trend it’s now part of everyday lives up and down the country. A massive one in five people in the UK buy their Americano or vanilla latte at least on a daily basis, raising the coffee shop sector’s value to over £18 billion.
With 18,000 outlets throughout the country, the coffee shop’s growth outstrips traditional retail by more than 10% per year in monetary terms. In an unusual economic pattern, independent coffee shops are growing alongside the big names, like Nero, Starbucks and Costa, with the independents accounting for 80% of the market in terms of the number of outlets.
More than simply a pretty frontage, coffee shops play a key role in the socio-economic development of the UK high street. Ranging from tiny train station kiosks to shops that are a couple of storeys high, they offer a casual, relaxed and social environment, where people feel they can hang out, take their children whether shopping or have a business meeting, with shops also cashing in on the all-day dining trend.
According to its 2014 report on the role of the coffee shops on the high street, Allegra Strategies claims coffee shops boost local economies by 2-4% in both footfall and ‘dwell time’, with half of consumers stating they would stay in an area longer just because there’s a coffee shop present.
“The coffee shop industry’s main strengths revolve around the ability to create community and meeting places within a society that is increasingly losing its traditional community centres, such as churches and local pubs,” says Richardson, who has been offering retail business development coaching for nearly 20 years.
“That, coupled with the trend towards increased consumption of food and beverages outside of the home, means that the marketplace is expected to continue to show double-digit growth within the foreseeable future.”
Achieving what fresh produce hasn’t quite managed to just yet, coffee has moved from a commodity to an experience that people long for and are quite particular about, even at up to £3.95 a cup.
UK consumers are also increasingly interested in where their coffee comes from, what kind of bean is being ground, how it’s been grown and how it was processed; revealing many parallels with the fresh produce industry. In fact, a lot of coffee shops that go out in search of the best coffee beans for their customers do the same when it comes to their fresh produce offer, making the two groups excellent high street bedfellows.
“If you are providing the best-quality coffee, people expect you to use good-quality fruit and vegetables too,” says owner of north London coffee shops, Minkies, chef Doron Atzmon, who started off with one shop in Kensal Rise 10 years ago and now operates three.
“People expect a certain philosophy when it comes to ingredients – I wouldn’t take anything but the best for my coffee, so the same goes for fruit and vegetables.”
The possibility for the fresh produce offer is almost endless, with some coffee shops offering as many produce lines as coffee through baristas who are becoming as knowledgeable about fruit and veg as they are coffee.
Two distinct coffee customers seek out produce
To tap into the coffee trend, first you need to know what your customer wants. At coffee shops, there are two types of opportunities for fresh produce sales, which relate directly to the two classic customer profiles using coffee shops.
The first type simply dashes in for a coffee, already knowing what they want and probably ordering the same thing every day. At the same time, they may pick up a healthy treat or smoothie for their day or evening, but it has to be convenient and ready right there and then or, at a stretch, ready by the time their coffee is made.
The other type of customer is there for the coffee, but also a social occasion or relaxation so part of the experience involves sitting down and savouring their drink, and possibly meeting someone. As such, they have the time to also order a salad, cake or freshly squeezed juice to accompany their coffee.
To capitalise on this latter customer, Minkies in Kensal Rise has recently installed a cold press juicer in addition to the juicer it’s had since opening, so it can sell vegetable juices as well.
“The only problem is it takes about four times as long to cold press than to make a juice and some people don’t want to wait, even when it means extra nutrition,” explains Atzmon, who has included juices and pieces of fruit as part of his coffee shop offer since he started. “I just provide what I want to see in a coffee shop.”
Atzmon even has a barrow of fresh oranges parked outside his Kensal Rise shop to lure in customers. “I used to go down to New Covent Garden Market every morning to pick out my fruit and veg, and then I saw a man trying all the fruit and picking things out just like I did. It turned out he was an ex-chef, who sources for businesses, so I now use him [Paulo from Feeling Fruity]. Demand for fruit and veg juices runs alongside the coffee and they help to sell each other.”
Richardson agrees and recommends to many of his coffee shop clients that they incorporate a healthy offer to complement coffee. “Fresh fruit is increasingly an important part of the product mix and has shown growth over the past few years,” he says.
“The momentum behind the ‘war on sugar’ means it is becoming essential to have alternatives to sweets and chocolate to ensure the average spend stays as high as possible. Vegetable sales, outside of lunch items, are rarely seen, but they can be part of protein-heavy breakfast alternatives, such as spinach and boiled eggs.”
Produce suppliers should make it easy for shop owners
However, Richardson warns that coffee shops owners and their produce suppliers should think about the overall product mix, their message to customers through that product mix and the margin available on the fresh produce, especially considering its perishability.
“In the past, sales of fruit were seen as a necessary evil – important to have but with high wastage levels and generally low sales,” he continues. “Those days are slowly changing; nearly all operators sell some fruit as an alternative and wastage is decreasing so feedback is more positive.
“One of the critical ways to sell more fruit, and vegetables to a lesser extent, is to think very strongly about how they could be pre-packaged in a format that makes it easier for the coffee shop owners to sell without having to do too much work. This means pre-portioning and washing in sizes that will appeal on a coffee shop counter.”
Richardson looks for innovation with the end consumer in mind, and welcomes any suppliers to contact him with new ideas.
“You have to think of the customer standing at the counter making a decision between a delicious-looking muffin or a piece of healthy fruit,” he says. “Too often suppliers try to force what they want to sell rather than what the end consumer actually wants. What works, for most coffee shops, is having products that are well merchandised and can be put on the shelf with as little amendment as possible.”
By 2018 it is predicted that there will be even more coffee shops in the UK – an astonishing 20,500 outlets, in fact. There is no reason to believe that fresh produce can’t capitalise on that continued growth and become a staple of the coffee lover’s diet.