'Coffee lovers shunning Costa for upmarket drinks'

Costa Coffee's sales rose just 0.1 per cent in the last quarter to August.
PA
Francesca Gillett25 October 2017

Coffee lovers are shunning Costa in favour of more upmarket alternatives, latest sales growth figures have suggested.

Costa’s sales rose just 0.1 per cent in the last quarter to August compared with 1.1 per cent in the three months before – a massive drop for the high street chain which saw sales fly by seven per cent three years ago.

It comes as Britain is reportedly entering a “third wave” of coffee with drinkers adopting more sophisticated tastes with a higher price tag and quality, the boss of Costa’s parent company Whitbread said.

The cost of importing coffee into the UK has risen since the Brexit vote and is combined with higher labour costs because of the new national living wage and apprenticeship levy, the Daily Mail reported.

Costa has more than 2,300 stores across the UK.
Getty Images

Alison Brittain, the chief executive of Whitbread, told the Mail shoppers are now willing to “spend more per cup for higher quality and innovative drinks”.

She added there was a chance for mainstream coffee shops to appeal to more sophisticated drinkers.

But Jeffrey Young, at industry analyst Allegra Strategies, the UK is already in the fifth wave of coffee which appeals to millennials who are after well-designed quality products and fresh food.

Whitbread’s entire group profits rose 20 per cent in the six months to the end of August.

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