It wasn’t long ago that inviting someone out for a drink meant one thing – a trip to the pub – and asking for a “flat white” would get a perplexed response from the staff in most pubs and cafés.
Now however, coffee shops are noticeably prevalent and may have already taken pubs over as a place to gather with friends and have a social drink.
Britain’s Growing Thirst for Coffee
As meeting places go, coffee shops usually possess a convivial atmosphere, without the alcohol or rowdiness that can be associated with pubs. Pubs traditionally have been more about males in the evening, whereas cafés are very female-friendly and are open all day. And as the number of tee-total adults is rising, our thirst for coffee is taking the place of alcohol. About 1.7bn cups of coffee are sold each year in the UK from more than 18,000 outlets, a figure that is set to grow to almost 21,000 by 2020, according to Allegra Strategies. Fewer people are satisfied by a cup of instant coffee by their side at home or in the office, and so they look to venture to more artisanal places for their daily dose of caffeine. But coffee shops aren’t the only places to go to get this hit. Pubs are stepping up investment in the segment, fast-food operators are improving their coffee offerings, and even the baker Greggs is revamping its shops to get in on the act, fuelled by Britons’ growing thirst for coffee outside the home. By offering cut-price coffee that can still compete on flavour, pubs are challenging for their own coffee market share.
Pubs Are Rising to the Challenge
A couple of big British breweries are fighting back in their own way. The London brewer Fuller’s has created their own-brand coffee, approaching it in a similar artisanal manner that the high-street coffee shops do. They now sell over 1.25m cups a year and opened a coffee shop in 2014 as a centre to train its staff as baristas. Welsh brewer Brains has gone one step further and bought their own chain of coffee shops, Coffee#1.
Many pubs have started opening early in the morning after investing in coffee-making equipment and signing deals with the likes of Costa (Spirit Pub Company) and Lavazza (Wetherspoons). Wetherspoons state that they sell upwards of 50 million coffees and teas each year, making big pub chains seem an enticing partner to coffee companies. Opening earlier in the morning allows pubs to reinvent themselves slightly, giving them more of a coffee shop vibe. Britain’s increasingly mobile workforce are often looking for a place outside the home/office to get some work done, and setting up in a pub with Wi-Fi can be an enticing idea for some.
Mark Stevens, owner of gastropub The Rose in Shenfield, Essex, sells 1,200 cups of coffee a month, with the top sellers being cappuccino and Americano. He opened the pub in November 2014 and used the Star Pubs & Bars exclusive deal with Italian Coffee Roasters Kimbo to launch their coffee range. “We still have a bar area but we are finding the designated driver who has a couple of soft drinks will add a coffee or even a speciality tea,” says Stevens.
The iconic British pub as we know it is changing, but we’re optimistic that this change can be for the better. That’s why at Boost Capital we provide working capital to UK pubs and SMEs, so that they can take advantage of growth opportunities to transform themselves and be well positioned to handle any uncertainties that may lie ahead.