2021 Outlook: The State of Franchising in the Coffee Sector

The pandemic has changed the way every business works. As an important part of the hospitality sector, coffee shops were one of the hardest hit businesses. Having been growing on a year-on-year basis, what can aspiring and existing coffee franchises expect from 2021?

When it comes to starting your own business, franchising has often been one of the go-to business models to choose. Only one percent of closing franchising cited commercial failure as the reason for doing so [British Franchise Association], making this one of the safer ways to run a coffee shop. But in an environment that has become increasingly difficult for everyone, how is the rest of the year looking for coffee franchises?

The coffee shop sector in 2021

Coffee shops have had to adapt quickly and make the most of the new way of working. All this means that the coffee shop industry looks extremely different to that of two years ago. For example, some of the following trends are far more apparent: 

• Service is a lot more flexible and digital
• There are a wider range of vegan, vegetarian and gluten-free products
• There are more subscription and delivery-based services
• Mobile and van-based franchises are more popular than ever
• Sustainability and carbon footprints are driving business innovation

In a short space of time, the industry has had to adapt to new ways of working - and all with new priorities. Not only that, businesses have had to get extremely good at them. Having learnt these lessons though, coffee franchises are taking many of them forward permanently.

It’s more important than ever to make sure you’re carrying out your due diligence, though. It’s an unfortunate reality of the current environment that not all businesses are in great shape. Do your due diligence and make sure that whatever franchise you work with ticks every box.

As expected, the coffee industry in 2021 will still be focused on operating around COVID-19. This time around, it won’t be about cutting costs or uncertainty management. Rather, it will be about taking the lessons and adaptations from 2020 and applying them permanently, while still preparing for the unknown arrival of the post-COVID landscape of the (hopefully) not-too-distant future.
- Nathan Gilliland, Food & Beverage Insider. 

The outlook for the coffee industry

Many coffee shops have been forced to close either temporarily or permanently, so many potential franchisees have been put off starting their own businesses and making a career change with a coffee franchise. While times have been tough, people are looking to get back to the things they were doing on a regular basis, and this includes going to coffee shops.

The recovery will take time, but visit any high street around the country and you can see the signs of that recovery already taking place. Demand to this sector is flooding back already, meaning that many franchises are already eyeing up future growth. And that means, they’re on the lookout for new franchisees. The ideal franchisee would be:

• Ambitious
• Determined to succeed
• Believe strongly in the franchise’s ethos
• A great representative for the franchise 
• Relatively experienced in recruiting and leading a team
• Confident leading a team
• A great communicator 

Passion is what drives you. Passion keeps you going despite the difficulties that your business will inevitably come across. I had many opportunities to throw up my arms and simply give up, but my passion caused me to keep going. I couldn’t think about anything but making my business succeed.
- Mike Kappel, Forbes

Advantages of running a coffee franchise 

Coffee shops have quickly become a staple of the British high street. In the years leading up to 2020, the branded coffee shop industry was growing in worth every year, reaching over £10 billion in 2018 [Statista]. 

Of course many businesses have since been hit hard, but there’s no doubt that this is an industry with a lot of pent-up demand still waiting to be released. If you’re an ambitious aspiring franchisee looking for a profitable industry, the coffee sector brings a lot of other advantages besides:

• The chance to be your own boss
• Enjoy a brand name and reputation established over years
• Training and support before and after you open
• Specialist coaches and support on things such as marketing and recruitment
• Plenty of room for growth
• The diversity of serving new and different customers every day
• The satisfaction of giving great service and working hard on a daily basis

Although the environment is somewhat challenging, for the right franchisee, there are some exciting, fast-growing, and profitable opportunities in this sector. So, why not consider some of the following franchises to start your next coffee business?

Franchising opportunities in the coffee sector

There are some excellent franchising opportunities in the coffee sector that will allow you to make the most of this profitable industry.

• Auntie Anne’s is one of the UK’s largest soft pretzel franchises, as well as offering some delicious coffee and plenty of snacks besides. For a total investment of £145,000, you will be entitled to a whole lot of training and support as you get your new coffee franchise up-and-running.

• The Acai Spot is a creative coffee franchise with a range of visually appealing and tasty snacks, coffees and soft drinks. To be part of this fast-growing and ambitious franchise, you’ll need to make a minimum investment of £135,000.

If the coffee sector isn’t quite right for you, your franchising experience doesn’t have to end. There are dozens of franchises in a whole range of sectors on the UK franchise directory. You can filter through different sectors based on the criteria you set, so you’re sure to find a great opportunity to suit you.