Food and DrinkHospitalityNews

Rising Prices Highlight On Premise Potential for Hot Beverages

Hot beverages are an increasingly popular part of the drinks offer in pubs, bars and restaurants—and with the right range and price points, suppliers and operators have a great chance to drive more revenue in 2022

Those are among the key takeaways from CGA’s latest MealMetrics research, which reveals key pricing trends across the category. The data can help businesses to optimise sales and marketing strategies in a fast-moving and competitive segment of the market.

MealMetrics shows the average price of a cup of coffee has increased by 7.1% over the last two years, to £2.40. It is a steeper rise than the price rises for both tea, which has climbed 4.7% to an average of £2.04; and hot chocolate, up 4.5% to £2.64.

Coffee prices are rising particularly sharply in pubs (+8%) and bars (+21%), while falling slightly (-2%) in restaurants. Average prices now stand at £2.38 in pubs, £2.68 in bars and £2.54 in restaurants. Bars’ impressive coffee sales are being driven by the Latte, Americano and Cappuccino, all of which have seen double-digit rises in the last two years, while liqueur coffees have led increases in pubs.

In the tea sector, MealMetrics highlights the increasing price points of speciality and indulgent options like fruit teas, prices of which have risen by 33% and 21% in restaurants and bars respectively. Herbal teas and Earl Grey have also seen sharp rises across the On Premise, outstripping English breakfast.

“These numbers show how hot beverages are commanding increasingly attractive price points,” says CGA foodservice client director James Ashurst. “Premium and speciality coffees and teas are flourishing, especially in bars, and they show how the On Premise is making itself a popular alternative to cafes and coffee shops for consumers – who are more knowledgeable than ever about their drinks. This is a great place for suppliers and manufacturers to launch and grow hot beverage brands, but identifying the market hotspots and optimising pricing strategies will be central to success in 2022 and beyond.”