Automatic Merchandiser serves the business management, marketing, technology and product information needs of its readers including vending operators, coffee service operators, product brokers, and product and equipment distributors in print.
Issue link: http://automaticmerchandiser.epubxp.com/i/571501
S P E C I A L A N N U A L R E P O R T : S T A T E O F T H E C O F F E E S E R V I C E I N D U S T R Y Adding new services was moti- vated by operators wanting to be proactive, a majority of respondents explained, rather than due to cus- tomer requests/market pressure. Most operators cited that they wanted to maximize their revenue-generating opportunities and/or wanted to stay at the leading edge of the industry. Due to the growth in non-coffee, the levels of revenue generated by coffee in chart 5 appear to be slip- ping. Because total sales is out of 100 percent, the extreme decline in private label and national brands should be viewed more as evidence of product and service diversifca- tion, rather than a true decrease in interest for these segments of cof- fee. Indeed, demand remains very strong for both private label and national brands. Private label was rated the top-selling OCS product for the past 12 months by 27.3 percent of OCS operators (chart 5B). Clearly, locations are still asking for a value blend coffee from service providers. National coffee brands were top sell- ers for 24.7 percent of OCS provid- ers showing a continued demand for consistent quality coffee with a nationally known name. Drip is out, single-cup is in Single-cup continues to grow. While the placement of single-cup brewers, which includes all models of coun- tertop brew-by-the-cup equipment, has seen only a modest increase – 23.2 percent, up from 22.3 percent — the number of requests for single- cup service options has skyrocketed. Operators talked about dramatically different requests from locations seeking OCS than in previous years because everyone wants their cus- tomized coffee. In fact, most new customers ask about the single-cup and bean-to-cup options frst, even if it is not the brewer ultimately placed. In its latest National Coffee Drink- ing Trends Report, the National Cof- PRIVATE label coffee was rated the top-selling product by over 25% of OCS providers. 18 Automatic Merchandiser VendingMarketWatch.com September 2015 CHART 4C: REVENUE PER CUP, SINGLE-CUP COFFEE, 5-YEAR REVIEW 2010/2011 2011/2012 2012/2013 2013/2014 2014/2015 Revenue 42.5¢ 41.8¢ 43.1¢ 44.9¢ 45.5¢ CHART 4B: REVENUE PER CUP IN CENTS PER CUP, FRACTION PACK PLUMBED IN/POUROVER COFFEE, 5-YEAR REVIEW 2010/2011 2011/2012 2012/2013 2013/2014 2014/2015 Revenue 10.8¢ 11.7¢ 11.8¢ 12¢ 12.4¢ *Previous numbers have been adjusted based on additional data CHART 5A: % OCS SALES BY PRODUCT CATEGORY, 5-YEAR REVIEW 10/11 11/12 12/13 13/14 14/15 Private label coffee 28.1% 28.2% 18.2% 21.8% 12.7% Local coffee brands 12.5 8.5% National brand coffee 26.9 28.1 24.4 21.9 12.1% Value frac packs 3.5 5.4% Whole bean coffee 4.7% Espresso/cappuccino 3.6 3.7 5.4 1.9 4.3% K-cups 7.9 7.4% Other single-cup 6.0 5.2% Other coffee* 12.1 9.9 17.4 4.8 6.0% Total Coffee 70.7 69.9 65.4 80.2 66.4% Other hot beverages 4.9 5.5 6.4 4 3.3% Soft drinks/juices 5.4 5.7 6.6 1.8 4.5% Bottled/fltered water 5.7 4.8 7.3 3.9 5.3% Creamers/sweeteners 5.6 6.6 6.5 5.2 4.5% Cups/paper products 5.4 6.2 6.5 4.5 3.8% Tea 3.6% Water Service 4.9% Other 2.3 1.3 1.9 0.4 3.6% *Includes flavored and varietal. *Previous numbers have been adjusted based on additional data CHART 5B: TOP-SELLING OCS PRODUCT FOR PAST 12 MONTHS 2014/2015 Local coffee brands 13.0% Private label 27.3% Value frac packs 2.6% Specialty drinks 1.3% Whole bean 5.2% National brand coffees 24.7% K-Cups 16.9% Single-cup 5.2% Tea 0.0% Water 0.0% Other 3.9%