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UK COFFEE SHOPS NEED 4 YEARS FOR COVID RECOVERY

Allegra Report

Last Updated on February 18, 2021 by Nick Baskett

According to market researcher Allegra Group, Coffee chains in the U.K. will take 4 years to recover after the COVID-19 pandemic wiped out an estimated 2 billion pounds ($2.8 billion) in sales.

England entered a third lockdown from January this year, with similar restrictions to the first lockdown in March 2020 leading to temporary closures and takeaway-only trading affecting sales.

In the report, Allegra said, there was almost 40% decline in sales last year for the U.K.’s branded coffee chain stores, which are dominated by companies including Costa Coffee and Starbucks.

Even Caffè Nero, as previously reported is struggling during these difficult times, weighed down by a weakened balance sheet going into this unprecedented downturn.

The industry is expected to recover to pre-pandemic levels by 2024, although there’s “deep uncertainty” over the outlook.

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The U.K. faced a perfect storm of many things that are not going right for the coffee segment and there is a lot more uncertainty in U.K. than in Europe. – Jeffrey Young, Allegra Founder and Chief Executive Officer

Not only does the UK coffee retail industry, which has the highest number of branded chain stores in Europe have to face difficulties from the Covid pandemic, they are also faced with the uncertainties from Brexit.

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