How and why coffee is massive business for the UK
Whether it’s cappuccinos for the commute or an after-meal Americano, us Brits are crazy about coffee. The culture is engrained in the way we live — but how did it all begin and where is our love of java taking us? Paper coffee cup retailer, Inn Supplies, explores.
The growth of coffee shops
Over the past six years, the landscape of coffee shops in the UK has shifted dramatically — much to the delight of coffee-loving Brits. Nowadays, brands like Starbucks and Costa are household names, with outlets found in the majority of British towns and cities.
However, less than ten years ago, the number of these big-player coffee shops was considerably less. Costa’s growth is perhaps the most impressive — back in 2010, the chain had 658 coffee shops in the UK. In just a five-year period, that figure had grown by more than double to 1,582.
Although widely regarded as one of the world’s biggest brands, the number of Starbucks coffee shops in the UK is surprisingly low. In 2010, there were 595 outlets. By 2015, this figure had grown by just 124, taking the total to 719. While still dwarfed by Costa’s market share, the increase still illustrates our growing love affair with coffee.
In fact, all of the UK’s big coffee brands, including Caffè Nero, Pret A Manger and Wild Bean Cafe have witnessed growth in their number of retail outlets.
Other brands are trying to get a cup of the action too. Greggs has been steadily introducing coffee to their offering, growing the number of shops serving coffee from 1,269 in 2010 to 1,621 in 2015. In fact, as of 2015, 39 percent of the coffee market was occupied by non-specialist outlets, like pubs and supermarkets.
It’s no secret that pubs are struggling to keep up with the changing economic climate. The Campaign for Real Ale (Camra) reports that an average of 27 pubs are closing each week, with 1,088 shutting their doors between June and December 2015. The attachment of pubs to the thriving coffee industry works to underline the popularity and success of the shops.
How much coffee are we drinking and who’s drinking it?
Naturally, the growth in coffee shops is fuelled by a growing demand for java. According to research from Mintel, almost three quarters of Britons now buy coffee when out and about. This lifestyle is most popular in the 16-34 age category, with 81 percent doing so.
Further research from Kantar Worldwide found that 80 percent of coffee shop fans visit an outlet at least once a week. Some 16 percent of hardcore coffee lovers visit every day.
We drink an estimated 55 million cups of coffee each day in the UK. Over the course of the year, around two billion of these cups come from coffee shops. In 2015, we spent £7.9 billion in UK coffee shops. Showing a 10 percent increase on the previous year, this expenditure is set to soar again in the coming years.
Allegra predicts that by 2025, coffee shops in Britain will achieve a £15 billion turnover. To support this growth in revenue, the number of outlets is expected to expand too. The 20,728 coffee outlets recorded at the end of 2015 is set to grow to in excess of 30,000 shops.
With our love for coffee growing stronger by the day, there are no signs of the industry slowing. Anyone fancy a coffee?
UK office space slashed as hybrid working looks set to stay
With hybrid predicted to be the working model of the future, and businesses both large and small announcing that WFH will continue for employees into the future, the traditional office space is being re-thought.
Businesses are both questioning how much space they need for a hybrid working future, especially if it means they can potentially save money, and what form that space should take.
UK firms slashing office space
Back as early as February, HSBC – whose real estate footprint currently stretches to around 112 football pitches worldwide – said it would be cutting its post-COVID office space by half globally and by 40% in London over the next few years, as it looks to implementation of a hybrid working model in light of the pandemic.
Lloyds Bank followed suit. Following an internal survey where 77% of employees said they wanted to continue to work for 3+ days a week post-pandemic, the bank announced it was also moving to a hybrid model, and so looking to cut its office space by 20% over the next two years.
In fact, the latest research from consulting firm PwC reveals that a third of organisations surveyed (258 of the UK’s largest companies) believe they will reduce their office footprint by more than 30%.
The findings of PwC’s Occupier Survey indicate there is likely to be a sizeable fall in occupied office space with half of executives surveyed saying that despite taking into account mass vaccinations, employees will continue to work virtually 2-3 days a week.
And companies continue to announce the hybrid working model for their employees. Accountancy firm EY has just announced that its 17,000 employees are moving to a hybrid way of working, WFH for at least two days a week. This follows PwC which in March said workers could stay at home for half the time and KPMG which this month said it would expect employees to only work two days in the office every week.
More collaborative work spaces
However, what’s also clear from PwC’s research is that the role of the office is not going to disappear completely, but instead adapt to a new way of working, with half of all organisations with more than 100 employees saying they have a real estate and workplace strategy that considers the long-term impact of COVID-19.
“We may see an increased demand for flexible space as many businesses operating models may well need that option if holding dead space is to be avoided,” says Angus Johnson, UK Real Estate Leader at PwC UK.
According to the survey, more than three quarters of respondents said they are likely to reconfigure existing office with 43% of financial services firms stating that they are extremely likely to do so as a result of the pandemic.
“It’s also clear that the nature and purpose of office space is going to change. As occupiers seek new, different space to meet their accommodation needs, environmental aspects will be increasingly important. If the real estate sector is to truly succeed as a more dynamic, greener industry it’s imperative that creative thinking comes to the fore.”
And companies are already thinking creatively how they can utilise office space in a hybrid future. So while HSBC is cutting a significant amount of office space, it is not downsizing its prestigious Canary Wharf headquarters, and instead reimagining the space. In April, CEO Noel Quinn announced the firm was embracing an open plan floor, with no designated desks or private offices, and instead using hot-desks in line with the future hybrid working style. “My leadership team and I have moved to a fully open-plan floor of the building in east London with no designated desks,” he said on LinkedIn.
Lloyds also reported it was adapting its office space, so that rather than individual offices, it will have a more collaborative workspace. And just last month, KPMG announced it too was ditching desks and individual offices, and replacing them with meeting rooms and conference halls for a more collaborative workspace.