Ei Group takes on coffee shops with launch of Beerista coffee

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Drinks: Drinks
Location: UK

Ei Group, which represents over 4,000 pubs in the UK, is looking to grab a share of the lucrative local coffee market with the launch of its Beerista pub coffee brand.

In recent years, the UK coffee industry has burgeoned to £3.7m per annum, and coffee chains have poached significant daytime trade from pubs, according to the Ei Group’s head of food Paul Farr.

‘Coffee shops now occupy that community-hub space if people need somewhere to go and sit during the day, and us having a strong coffee offering is our way of tackling that,’ Farr told Imbibe.

As well as offering a range of coffee machines, the group will provide training, price guidance and marketing collateral. It has sourced an Arabica coffee bean from Colombia, which, Farr said, has a similar taste profile to the popular Illy coffee brand. The Beerista strapline states ‘100% Arabica – 0% abv’ to emphasise its positioning as a pub brand.

Farr says that while some of its pubs currently have a strong focus on coffee, others have a more basic offering, which is where Ei Group has identified opportunities for improvement.

‘You might get the occasional independent, who’ll have a fantastic offer and have gone down the full barista route,’ he said. ‘[For others], it might be a kettle on the back of the bar, and if you order a coffee the barman will pull a face and think “oh God, I’ve got to make a coffee now”.’

Strong foundation

While he believes Beerista coffee should satisfy even the more sophisticated tastes of ‘third wave’ coffee drinkers, the group is not aspiring to the artisan market, but rather it is firmly focused on price. At around £2 a cup, it is approximately 50p less than your average high-street coffee.

‘We’ve gone aggressively with our pricing, because there is margin on coffee, and we want to have a really keen price point to make it more attractive,’ said Farr. ‘We’re not trying to be artisanal at the moment, we just want to have a really strong foundation.’

Ei Group isn’t the first pub group to seek a caffeine hit to its profits. Welsh brewer and pub operator SA Brain acquired the 15-strong coffee shop chain Coffee #1 in 2011, and has rapidly expanded the business. It was the standout performer for the company last year, with a 23% rise in operating profits, and is on track to reach 100 venues in 2018.

However, industry experts have suggested the UK market may be reaching saturation point with the current number of coffee shops. The froth seems to have finally dropped out of the Costa Coffee business, which reported a 1.5% drop in like-for-like sales for the 13 weeks to 30 November. This compares to three years ago, when sales were soaring by 7% a year.

‘What’s happened [with Costa]is that you’ve got [market]saturation,’ said Farr. ‘And also their pricing has gone really high — if you go in their shop and get two coffees and a sandwich it’ll cost you £15.’

For tips on how to have a successful coffee offering in your pub, and to see what other pub groups and businesses are up to, head here.

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