[Today's blog post is written by Sam, a recent escapee from corporate law, currently working with Escape the City and re-styling himself as a content, marketing and overall commercial development specialist. Enjoy!]
The London Coffee Festival wrapped up on Sunday afternoon after four days packed full of tastings, demos, presentations and networking – all fuelled by the ever-present buzz of the bean.
I was down at the Old Truman Brewery for the industry day on Friday and again on Saturday morning. Executed with style, it was a great event, full of interesting displays, passionate people and of course, a lot of very nice coffee. The event’s host – industry expert Allegra – predicts that the UK’s booming coffee market will continue to grow, estimating that the number of outlets will exceed 20,000 by 2018. This constitutes growth of about 25% on current levels.
If Allegra is on the money, it looks like there are some exciting opportunities to be had in the coffee market for entrepreneurial would-be escapees. This sentiment was backed up in the first part of BBC’s Business Boomers series, which aired last night and focused on ‘coffee shop hot shots’.
Here are my top 7 takeaways from the London Coffee Festival:
1. Coffee without thought no longer cuts it in the capital
People expect good coffee. Maybe they didn’t use to; maybe coffee drinkers were previously less sophisticated. But those days are long gone. If you’re going to make waves in this industry, you’ve got to understand where you’re sourcing from, how you’re roasting and how this impacts on the product that you’re serving.
Whilst our parents’ generation may not have been too choosy – it’s perhaps telling that the nation’s favourite coffee has long been the latte, although this is a fading trend – the recent growth of intelligent roasters and influence of Antipodean specialists (they don’t mess about with their coffee in Oz or NZ) means that consumers expect a top product: great beans, a thoughtful roast and a considered brew. Tick all of these boxes – otherwise we won’t be coming back.
2. The independent market is much bigger than that for branded outlets
There is real growth in the independent coffee sector. Allegra’s research confirms that people are becoming increasingly aware of factors such as where their coffee is sourced and how it is roasted. The ‘candy coffee’ served up by the big boys no longer cuts it for the increasingly sophisticated tastes of twenty-first century consumers, and the quality of the coffee on offer is fast replacing location as the most important factor when it comes to choosing which coffee shop to go to.
So what does this mean for escapees? Well, the opportunities are there. It’s just a question of who is going to take advantage of them. And we’re already seeing people do it – for example Tim Baker, an ex-management consultant who has set up a specialty coffee shop outside Morning Crescent tube station.
3. Coffee entrepreneurs have cojones
As much as the market for independent coffee retailers is expected to continue its growth, it’s clear that there a whole host of great coffee roasters and retailers already working their game in London. To crack the market, you’ve got to be willing to work hard, learn your craft, and believe in your product. Then, you’ve got to make it happen – that’s what the existing crop has done: they’re entrepreneurial and they take risks.
That’s what really struck me as I wandered around the festival and spoke to roasters, baristas, importers and connoisseurs. The sense of entrepreneurialism was ubiquitous. And that’s why the industry is growing; because the product is being taken to the next level, and the competitiveness in the industry (in terms of quality of product, they are all really nice – see #6 below!) is driving everyone on.
4. It’s not only baristas who are primed to benefit from the growth in the coffee industry
The likes of Shopwave (ipad based POS system), Sumup (app for mobile card payments) and Q App (mobile ordering platform) demonstrated at the LCF that a bit of entrepreneurial spirit has the potential to go a long way in the coffee industry.
With busy baristas, mobile vendors and ever-increasing competition for the customer’s coin, innovative ideas like these three that help to improve the customer experience or the barista’s ease of sale are likely to do well riding on the coat-tails of this high-growth industry. And they could potentially make an awful lot of money.
5. Brand black and white, but only if you want to fit in
Almost all of the branding on show at the LCF was black and white. Just take a look at the list of exhibitors on the LCF website.
If you’re a roaster or barista, then apparently you need your blacks and your whites. Yes, yes – that much. No doubt a Juventus-themed coffee shop would be a real winner!
Alternatively, perhaps there’s scope for someone to smash right in with something a little less hipster and carve out something of a niche.
6. The coffee community is a real community
There was a great sense of camaraderie around the Old Truman Brewery, with people very willing to offer advice, share experiences and commit to training and partnerships in the future. There’s very little pretence in the coffee industry, and that’s refreshing.
7. Don’t take things for granted – the fact that you’re an independent outlet doesn’t itself mean that customers will come in droves
Sure, the growth in the independent market demonstrates that consumers will make the effort to seek out the artisanal operators. And if you’re the type of coffee shop that pays your corporation tax, then all the better.
But, don’t think for a second that just because you’re independent means that you’ll be raking in profits. The fact that Allegra’s research emphasises the importance of coffee quality to the contemporary drinker means that if your coffee is not up to scratch, your revenue similarly won’t be.
There’s a reason the big boys have reached the top of the mountain – they gave, and continue to give, consumers what they want. Whilst not everyone is keen on their ‘candy coffee’, many people are. The big chains can rely on their products, because they have proved their popularity.
So learn from the big boys, and make sure that your product is something that you can rely on. If you’re putting all of your beans in one coffee basket, then you better make sure you’re doing a good job brewing the beans.
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