Recap #20 | October 22, 2020
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A recent Euromonitor International report suggests that the number of American coffee and tea shops will decline for the first time since 2011. The report estimates that the US will have just over 25,000 outlets specializing in coffee or tea by the end of this year, a reduction of 7.3% from last year. It also estimates that annual sales will drop 12% to approximately US$24.7 billion. In a feature exploring the effects of COVID-19 on the coffee shop landscape, Bloomberg reports that Canada is also seeing a similar contraction. According to Allegra World Coffee Portal, annual sales in Canadian coffee shops are expected to drop 22% from 2019 to CA$9.5 billion. Allegra also suggests that local independents will take a greater share of Canadian suburban trade. In the Bloomberg feature, Rabobank analyst Jim Watson noted that the most challenging situations for independent cafés are based on their location. According to Watson, residential coffee shops are outperforming those based in office or city center locations. And while independents have shown to be nimble in adapting their businesses to their community’s needs, they’re generally more at risk due to highly-variable factors beyond their control, like rent negotiations and government assistance.
Last week, the National Coffee Association of the United States of America released the results of a major new national poll. Highlights from Coffee, Consumers, and COVID-19: Road Map to Recovery indicates that the pandemic has not changed how much coffee Americans drink, although it has changed where they drink it. According to the poll, 6 in 10 Americans drink nearly 3 cups of coffee every day. While home consumption has always been strong in the US, the results of the poll indicate that pandemic closures of coffee shops have grown the volume of coffee consumed at home significantly. But the desire to return to coffee shops is strong: more than half of typical coffee shop visitors indicated that they had already begun to return to coffee shops, or planned to do so in the next month. Avenues like app-based ordering, delivery, and drive-through ordering all saw an increase among people who reported drinking coffee regularly. The poll also reflects current tensions around mask-wearing, which is an effective barrier to COVID-19 transmission. Of those polled, 44% said they were comfortable visiting coffee shops when face coverings are required for all staff and guests, but 48% said they felt comfortable when workers alone wore protective items.
This episode of Recap was made possible with the support of BRITA. If you want to dive deeper into anything you heard today, check out the links in the description of this episode. Recap will be back in two weeks’ time. Thanks for listening.
Further Reading:
Number of Coffee Shops Set to Decline for the First Time Since 2011
US National Coffee Association Releases Highlights from Coffee, Consumers, and COVID-19: Road Map to Recovery
US Coffee Drinkers Consume as Much at Home During Pandemic - Poll (Reuters)
Americans Drinking as Much Coffee Now as Pre-Pandemic (Global Coffee Report)
Americans Still Drinking Three Cups of Per Day, But More At Home, NCA Report Shows (Daily Coffee News)