Consumers’ overall frequency of purchasing hot drinks out of home has remained relatively unchanged between 2013 and 2014 despite improvements in consumer confidence over the period. That said, the largest player in the market, Costa Coffee, has managed to continue to increase customer transactions in 2014.

Developments such as expanding food menus and mobile apps to push promotions are increasingly common as specialists fight for market share of the out-of-home hot drinks market, not just from each other but also from non-specialist competitors increasingly targeting this occasion.

Outlet diversification continues to be a key trend as operators look to develop a stable of different outlet formats in order to cater to the contrasting demands of various locations and help bolster usage. For example, express/self-service units cater for grab-and-go occasions while at the other end of the spectrum, café/restaurant-like venues target more leisure-focused locations. Various operators are also working with retailers to create in-store catering outlets to benefit from the shared footfall.

This report covers those foodservice establishments where coffee is the primary sales item. They are based on the European and North American coffee shop models, typified by Starbucks, Costa Coffee, Caffè Nero and Coffee Republic, offering a wide variety of coffee drinks, eg cappuccino, latte, mocha, etc. Other items are usually on sale, such as pastries, tea, coffee beans, etc. However, the food offer may be restricted.

Coffee shops include venues such as individual stores, kiosks and concessions. These may operate in a number of locations – motorway service areas (MSAs), health clubs and hospitals, for example, as well as standalone outlets. However, they must be independent of the facility they are located in.

This report does not include other establishments that sell coffee, such as restaurants, tea shops or traditional cafés, except as a means of comparison. Nor does it include sandwich shops, such as Pret A Manger or EAT, although these are mentioned in the consumer research for comparative purposes.

Market sizes at constant 2014 prices have been calculated using Mintel’s foodservice deflator.

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