Cafe Society Drowns Tea

It appears that Britain’s tea habit is in decline. The Costa coffee franchise has seen sales increase by 16.5%, with the total number of coffee outlets rising, while sales for Tetley round tea bags fell by 17.3% in 2013.

This popularity of coffee is evident in the town of Oundle, where there is no shortage of choice. Beans Coffee Stop, The Coffee Tavern, The Talbot, Smiths at No 4, Dexters and Deli Divines all offer hand-pulled coffee, as do the pubs, while Waitrose, the Costa coffee self-service bar at the Co-op and Trendalls offer a freshly-ground, brewed cup.

However, selling coffee is not exactly a gold rush business. Local high street coffee providers have little control of their profit margins due to the dependency on Brazil for the supply of coffee. If the supply of coffee in Brazil decreases, there is an excess demand for coffee, resulting in an increase in the commodity price.

This has been the case in the last few years when a drought in Brazil caused a decrease in crop yields, leading to price rises of 21% from 2010-2012. The rise in the price of coffee has also been matched by a rise in its popularity in Britain, where 2.8kg of coffee per person was consumed in 2013.

John Raper, owner of The Coffee Tavern said: “There was a problem with the pricing with manufacturers passing on the costs to us, but generally it’s not an issue.”

Beans have not changed their coffee prices for well over a year, and Smiths have yet to raise their prices after four years.
Waitrose has become the second largest provider of coffee in the UK after McDonalds, pouring 1m cups of coffee per week, due to the introduction of the myWaitrose card which rewards customers with a free cup of coffee or tea.

With a changeable commodity market, coffee providers cannot predict if their prices will rise in the future. Nor can they assume coffee will remain the nation’s favourite drink if prices do rise.

By Toby Warner