By Andrew Williams
The branded coffee chain sector is predicted to grow by a whopping £1 billion over the next decade, with the market showing few signs of reaching saturation point, according to industry analyst Allegra Strategies.
Growth over the past year has exceeded expert forecasts, while London, previously considered a saturated market, grew by almost 10% year-on-year.
"The growth in the branded coffee chain market is stronger than at any time I have seen in the last decade, because coffee has become such a mass-market phenomenon," said analyst Jeffrey Young, who was previewing figures from Allegra Strategies’ 2008 report into coffee chains at Caffè Culture.
The faster-than-anticipated pace of coffee shop openings over the last year has seen the total branded market grow to 3,400 outlets in the UK. Turnover is predicted to exceed £1.5bn this year and "conservative estimates" forecast the £2.5bn mark being broken by 2017.
Allegra’s study splits the chains into "coffee-focused" and "food-focused" categories. The coffee- focused side, including Costa, Starbucks and Caffè Nero, has grown the number of outlets by nearly 15% in the last year. These trends are likely to continue amid favourable conditions on the high street, he predicted.
"There are opportunities for independents, but chains are dominating the prime footfall sites," said Young. "Those that are thinking medium- to long-term are taking the opportunities, despite the credit crunch."
l Caffè Culture report, pgs 14-15
=== In Short ===
== Baker still under offer ==
Administrators for Tindale & Stanton are still locked in negotiations with potential purchasers. A spokeswoman for PricewaterhouseCoopers said it was still in discussions with "several interested parties" about the Durham-based baker. PWC is expected to make an announcement early next week.
== Photocake online ==
Greencore Cakes and Desserts is trialling a new photocake website, in partnership with Sainsbury’s. The website - [http://www.designyourcake.co.uk] - allows consumers to create their own cake design, combining images with personal photographs. Consumers purchase the cake in-store and can then create an edible design transfer online, which is sent to them in the post.
== UBUK’s TV spend ==
United Biscuits UK is investing £1.2m in an advertising campaign for the Go ahead! brand. The TV ad will hit our screens over the summer months. It will run from 2 June to 22 August and will focus on its Yoghurt Breaks range.
== Fox’s grows up ==
Fox’s has launched a range of biscuits aimed at the indulgence end of the market. Whipped Creams have been designed to fill the gap in the grown-up biscuit market. Available from June, the shortcake biscuits will be filled with cream and either Sinfully Strawberry Conserve or Lustfully Lemon Curd.
== Peter’s football freebie ==
Peter’s Food Service gave away free pies to hungry fans on the day of Cardiff City’s FA Cup final clash on 24 May. Over 1,000 pies were given out at Ninian Park as fans boarded buses for Wembley. Technical director David Jackson said: "As a Welsh-based bakery, we wanted to celebrate Cardiff’s achievement in the FA Cup."