According to the Allegra World Coffee Portal definitive report, the UK coffee market is estimated at 18,832 outlets and the branded coffee chain segment recorded £2.9bn turnover across 5,781 outlets. It delivered sales growth of 11.9% and outlet growth of 4.9%, adding 271 stores during 2014. The coffee shop sector has been in growth for 16 consecutive years and is one of the most successful in the UK economy.
Costa Coffee (1,821 outlets), Starbucks Coffee Company (824) and Caffè Nero (590) are still the leading brands in the UK, with a combined share of 56% of the branded chain market by outlet numbers. Market leader Costa added 151 UK outlets and achieved 15% sales growth in 2014.
The non-specialist sector of pubs, fast food operators, supermarkets and retail stores has put pressure on coffee-specialised chains through improvements to their offers. The sector has outpaced branded chains with outlet growth of 14.5% to reach 7,017 establishments.
The non-specialist sector took a further 2% share of market to represent 37% of the total coffee shop market, compared with branded chains with a 31% outlet share and independents with a 32% market share.
Predictions in the sector
Allegra predicted the total UK coffee shop market would exceed 27,000 outlets and £16.5bn turnover by 2020, driven by branded coffee chain expansion and non-specialist operator growth. The branded coffee shop segment is forecast to exceed £5bn across 7,870 outlets by 2020, with outlets predicted to grow at 5.3% compound and revenue at 10.0% compound over the next five years.
It is estimated that the UK has the long-term potential to comfortably host more than 9,500 branded coffee shops.
Allegra group managing director Jeffrey Young commented: “The UK coffee shop industry is showing consistent strong growth in both sales and outlets. Britain is fast becoming a nation of coffee connoisseurs. The UK consumer increasingly appreciates a quality cup of coffee, and operators must continue to deliver innovation and fantastic quality, while genuinely engaging with customers in order to stay ahead of the curve.”