Today’s consumer is well versed in all areas of specialty beverages. From the convenience store to the high-end restaurant, consumers are more demanding about the quality of beverage in their cup.
In this guide to specialty beverages, sponsored by Boyd Coffee Company, we’ll take a look at the latest trends in specialty coffees, premium teas and frozen beverages; what it takes to get involved in a specialty beverage program and what the potential benefits might be.
The National Coffee Association (NCA) and the Specialty Coffee Association of America (SCAA) conduct studies each year to gain insight into trends in coffee consumption and the business of providing coffee to consumers. They and other coffee trade groups have compiled some amazing numbers.
More than 50 percent of Americans over the age of 18 drink coffee every day, a total of more than 150 million daily drinkers. Among those individuals, the average coffee consumption is 3.2 cups per day. The average coffee cup size is 9 ounces.
In addition, more than 30 million American adults drink specialty coffee beverages each day, including espresso, latte, cappuccino and frozen or iced coffee beverages. Americans lag behind other countries when it comes to tea consumption, ranking 23rd in the world at less than a cup per day. (Turkey is No. 1 with an average of nearly 9 cups per person per day.)
Men drink as much coffee as women, and 65 percent of all coffee is drunk during breakfast. Another 30 percent of coffee consumed in the United States each day is consumed between meals, and the remaining 5 percent is consumed with other meals.
About 65 percent of coffee drinkers take theirs with cream and/or sugar, while the other 35 percent drink it black. Women tend to drink coffee to relax, while men tend to drink coffee to help them work more effectively.
With so much coffee being consumed in the United States every day, it’s no surprise that the coffee shop has long been a fixture of the American landscape. Coffee was an afterthought in those outlets, however, mainly serving as an accompaniment to a breakfast of eggs, bacon and hash browns (or grits if you were below the Mason-Dixon line).
It was the founding of a retailer of premium coffee beans and brewing equipment in Seattle in 1971 that propelled the consumption of coffee and espresso-based drinks to where it stands today.
The next level
Of course, that retailer is Starbucks, and it’s a rare town in the United States that doesn’t feature two or three of the outlets, usually within a few blocks of each other. Today, there are nearly 17,000 Starbucks in 50 countries around the world.
But Starbucks didn’t begin serving coffee and espresso-based drinks in its stores until the mid-1980s, when then-director of retail operations and marketing Howard Schulz took a trip to Milan, Italy, and observed the popularity of espresso-based drinks in that country. Eventually, Starbucks became a retailer of specialty coffee and espresso-based drinks, and a trend was born.
Today, half of the population of the United States partakes in the specialty coffee trend. Nearly 154 million Americans drink espresso, cappuccino, latte or iced coffees. Specialty coffee sales are increasing by 20 percent per year and account for nearly 8 percent of the $18 billion U.S. coffee market.
On average, drive-thru coffee shops sell 250 cups of coffee and espresso-based drinks each day. About 31 percent of coffee-shop sales are espresso-based drinks, while the rest is brewed coffee. The average price for an espresso-based drink is $2.45, while the average price for a cup of brewed coffee is $1.38.
Bottled iced teas sell for anywhere from $2 to $3.50 per bottle, while frozen beverages can range from $2 to $4 and even more.
If there's anything that restaurant operators can learn from the coffee giants, and even the mom-and-pop operators, it's that while incorporating a premium coffee or specialty beverage program can be a boon to the bottom line, it’s not as easy as simply buying a higher-priced blend of coffee and raising prices. In the following pages, we’ll take a look at the numbers and consider a variety of ways operators can incorporate specialty beverages into their offerings.