Costa Coffee to add 500 UK sites in five years

Whitbread’s Costa Coffee brand plans to add 500 UK locations in the next five years to take its UK estate from 1,711 sites to around 2,200 in 2018.

The company told analysts this afternoon that it is in negotiations on 180 of these sites. Property director Clive Bentley forecast that 200 sites would open in city centres and high streets, 100 would be in retail parks and drive-thrus, 80 would be located at universities and within offices, 100 would be located as concessions in stores like Next and Primark and 75 would be in transport hubs.

Average transaction value at Costa is £3.83 and coffee is now 49% of sales, with 69% of sales involving eating and drinking on site. Food sales account for 29% of total shop sales – and a key area where sales will be developed. Another 15 to 20 items would be added to the food menu in the coming year.

Chris Rogers, managing director of Costa Coffee, reported that Costa’s market share has grown from 7% to 11% of the UK market since 2009. He argued that long-term societal trends had worked in favour of the coffee market, such as the rise of the internet, mobile working and female spending power. He forecast that the coffee market in the UK would continue to grow.

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