HOT COFFEE
BREWING UP SALES
After feeling the heat of lockdowns, hot beverages sales are brewing up business once again, writes Claire Hibbit. Within major P&C operators, getting out from under $1 coffee will be necessary to improve already eroded margins.” – George Miller, CEO – Oceania, Tiger Coffee
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fter being the fastest growing category in the petrol and convenience channel (P&C) for the last five years, hot beverages has felt the heat of the pandemic.
Over the past two years, the sector has been impacted by pandemic-related lockdowns and work from home orders, which saw the elimination of commuters’ early morning coffee run. But, as workers begin to hit the roads and return to offices, sales are looking up. According to Theo Foukkare, CEO of the Australian Association of Convenience Stores (AACS), data from the newly released AACS 2021 State of Industry Report shows the hot beverages category rebounded in 2021, growing at 7.4 per cent, following a drop in sales in 2020. “This delivered an extra $22 million in sales, more than making up for the $11 million decline in 2020*,” notes Foukkare.
CONSUMERS SEEK CHOICE AND VALUE Hot beverages in the P&C channel have evolved significantly over the last few years as customers demand a better quality cup of coffee. 40 June/July 2022 | C&I | www.c-store.com.au
“Coffee quality and the speed of service required in P&C outlets drive many insights and trials,” explains Philip Badolato, National Business Manager – P&C, Grinders Coffee at Coca-Cola Europacific Partners Australia (CCEP). “Alternate milks have greatly increased in the cafe channel in recent times and there is certainly now a flow on effect into P&C where operators have a barista style offer vs fully automatic. “Where there used to be one type of alternate milk on offer, we are now seeing enough sales to justify three, sometimes four alternate milk types. Coffee is also playing a significant role all through the day in P&C with the increase in the afternoon coffee occasion.” According to George Miller, CEO – Oceania, Tiger Coffee, consumers are seeking choice and value, with alternative milk options, most notably oat milk, on the rise. “In cafes, alternative milk is seeing significant growth and is exceeding 45 per cent of coffee sales in most parts of Sydney, Melbourne, and Brisbane,” says Miller.
