I know, what a title! Over the last week, I have had a little more thinking time than usual and it is obvious that there is going to be a pinch.
Please take the first part here as facts that we are all aware of, not me whinging about how things are.
Negative effects on the UK market:
The world coffee market is up. This is good news in the real world but not for consumers. Fertilizers, labour, and everything have increased across the globe. The pound is weak/The US dollar is strong which compounds the cost. UK property, staff availability, energy, and inflation. I am going to try and avoid the C word. Our own national baggage if you will.
Over the last 14 years (in particular) specialty coffee has replaced the former commercial coffee giants. Some small lovely roasteries have quietly become monster processors. The fact is that many of these operators become what they set up to oppose. With 600 roasters now filling the space of the former big 10, horns are going to cross as consumption is going to plateau. Admittedly there is more consumption today than there was at the end of the last century, however with a reduced budget, is this going affect what people buy and ultimately what we sell?
If you are a roaster in the capital or another big UK city and you have what I would consider “big rent”. (Circa £300-500,000 per annum.) then this must be crippling with the increasing “other costs” that we are all facing. Survival will play out in one of a few ways.
Pushing up all costs to everyone else and adding to inflation. Increasing throughput. This will be a competition to the bottom. How low can you go? Oh and by the way did you know you just went out of business? Volume is how much of the coffee business
(“industry” if you will?) has managed to keep stable pricing whilst seeming to be doing the right thing on the other side of the globe. The coffee business has been floating on a cloud for the last decade and finally reality bights.
Maybe it’s time for a shake-up? Maybe we are already in the tumble-drier of change. Will investing in quality, quietly take a back seat?