New Food research report from Euromonitor International is now available from Fast Market Research
[USPRwire, Wed Dec 10 2014] The 4% increase in value sales in 2013 matched the strong growth of 2012, further cementing consumers’ increasing interest in the products and culture of cafés and bars, with revenue continuing to be driven by longer stays and higher bills. In addition to the recent Starbucks acquisitions of Teavana teas and La Boulange Bakery, many companies were eager to introduce new items such as grilled sandwiches aimed at the lunch crowd. Small cafés, in an effort to compete with the bigger brands, followed suit. Even juice/smoothie bars began to offer foods such as flatbread sandwiches and pizzas in addition to increased varieties of their juice and smoothie blends. These outlets, in which consumers have long been accustomed to hanging out in, now offer more options for those that do not just want a coffee or a smoothie. By adding teas, juices, sandwiches and baked goods, they spur sales by encouraging consumers with different tastes into the store and by keeping them there with appetising food which, in turn, makes them even more likely to order more beverages.
Caribou Coffee closed 168 of its stores on the East Coast and in Midwestern markets in 2013. The closures were met with a huge response on social media mourning the loss of the cafés. Facebook pages were devoted to closing cafés with former patrons sharing stories of times had there, in addition to a significant reaction on Twitter. 88 of the former Caribou cafés were converted to Peet’s Coffee & Tea, particularly in the D.C. area, Midwest and Mid-Atlantic, while the remaining 80 units simply closed. In 2012, both Caribou and Peet’s were purchased by German investment firm, Joh. A. Benckiser Group. Minnesota-based Caribou was sold for US$340 million, taking the formerly public company private, while California-based Peet’s was purchased for almost US$1 billion. “Over the past few months, we have revisited our business strategy, have taken a hard look at our overall performance, and have made decisions that best position us for long-term growth,” Caribou CEO Michael Tattersfield said in a statement.
Industry Prospects
Over the forecast period, cafés/bars in the US is predicted to post a 3% constant value CAGR to reach US$52.5 billion in foodservice value sales in 2018. As independents and chained operators alike attempt to continually grow their businesses, the draw of offering more types of food in traditionally beverage-centric establishments will only increase. Not only does this give them an opportunity to expand into different dayparts as Starbucks has with its appropriately-titled Starbucks Evenings, but it encourages increased consumption of their beverages, a synergy that any chain would be unwise to ignore.
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