Why More Cafes are Making Coffee In-House

Shutterstock

Shutterstock

As the demand for artisan coffee is only increasing, more and more cafes are roasting their own blends of coffee instead of getting them from mass-produced coffee companies.

This has fueled the growth of coffee roasting co-ops, where coffee enthusiasts and coffee store owners can rent time to use roasting machines to make their own coffee blends.

“The visions and the goals of the coffee roasters and the visions and goals of a cafe or bakery owner didn’t always align,” said Paolo Maliksi, one of the owners of Regalia a coffee roasting co-op in Long Island Island. “We are here to make sure that anyone can come in and roast for whatever reason.”

Consumers are willing to pay more for a food product that is high-quality, sustainable, and locally sourced. This is driving the growth in the craft coffee industry.

This is inspiring big retail coffee brands to adapt as the market becomes more inundated with coffee options.

“Rabobank says roasting shops alone aren’t yet a major threat to Big Coffee, but as young consumers move away from traditional brands, that’s forcing the old guard to adapt. JM Smucker Co., for example, has rolled out a new line of coffee called 1850 intended to attract younger drinkers who wouldn’t think to pick up a pound of sister brand Folgers,” writes “CNBC.”

Craft coffee is becoming so much more accessible too.

When a café doesn’t want to invest in making its own beans, there are so many options on the market and coffee traders are now more flexible when it comes to selling smaller batches. Previously, coffee traders were sending shipments of 20-feet containers but now there are E-commerce marketplaces for specialty roasters.

“Smaller specialty roasters are forcing importers and traders to become more responsive. When people are buying smaller quantities of anything, I think they expect to buy them in the same way they buy stuff from Amazon or their online grocers. We are having to find new platforms and new approaches to sell to people the way they want to be sold to,” said Cory Bush, managing director of 32cup.

Read more about the rise in premium coffee brews at “CNBC.”

Speaking of coffee, we recently sat down with the director of sourcing and shared value at Intelligentsia Coffee and Allen Wang, founder & partner of Kung Fu Tea about how these companies are standing out from the rest in this saturated artisan beverage market.

Why are Coffee Chains Attractive to Franchisees?

Cold Brew Coffee |   Shutterstock

Cold Brew Coffee | Shutterstock

U.S. coffee drinkers have an average of three cups a coffee a day, according to the National Coffee Association and 51 percent of coffee drinkers in the U.S. drink gourmet coffee.

In Britain, 80 percent of the population visit coffee shops once a week, as reported by the Caffee Society. There has been significant growth in UK market.

In the U.S., over 50 percent of Starbucks chains are still corporate-owned. But this is not the case in the UK. where "Starbucks does operate a franchise model of operation and only about one in five Starbucks in Europe, the Middle East, and Africa are company-run," writes "Forbes."

While Starbucks is still very much expanding, other gourmet chains like Costa Coffee are also on the rise.

Coffee shops offering unique brews and beverages are catering to today's adventurous consumers. Not to mention, consumers are willing to invest in premium coffee options– making the profit margins higher for operators.

"Coffee drinkers have also become much more sophisticated in their tastes - just stand and take a look at the menu in your local coffee shop next time you're there," writes "Forbes." "From different blends to added flavor shots, iced drinks to coffee beans with ethical provenance - this gives business owners not only more option to expand the range on offer without diluting the core product offering, but also means that consumers are willing to pay high prices for a premium coffee product and profit margins can be significant."

Unlike other restaurant chains, coffee franchises are often attractive to operators who are looking to own several stores because they all can be established in the same area.

"Find success with a first franchise branch and then it’s easy then to open more within a short distance and appoint managerial staff to run them. The reality is that most people won’t walk far for coffee. This then means that one franchise can quite realistically operate a number of franchise units within a relatively short geographical distance," writes "Forbes."

In a past episode of The Barron Report, Host Paul Barron predicted that 2018 would be the year of coffee infusions and he was right. Watch the video below to learn more about how coffee chains with unique blends will be the ones that consumers gravitate to in this saturated market.

Starbucks is Opening More Reserve Bars in Canada

The Seattle-based coffee chain Starbucks has quickly conquered the market with over 28,000 stores across the globe.

In February of 2017, the chain opened its first Starbuck Reserve, a luxury coffee store that takes the cafe experience to the next level, while serving rare and unique coffees.

After rolling out the first few stores, the coffee chain also said that it has plans to expand with over 1,000 Reserve stores.

"While our Roasteries are designed to be bold, educational environments, our Reserve store takes the best of coffee craft as well as artisan baking and layers in a marketplace-style customer experience creating a space that has both energy and moments of intimacy," Liz Muller, Starbucks senior vice president of Creative, Global Design and Innovation, in a press release.

Apparently, these Reserve stores are doing especially well in the Canadian market. There are already three Reserve Bars in Canada, two in Ontario and one in North York. These Reserve Bars usually feature elaborate decor and store designs. The newest Reserve in North York has a wraparound bar.

But coffee isn't the only thing on the menu. These bars feature much more food options than the traditional Starbucks chain like menu items chorizo mac and cheese and the pear and brie flatbread.

The company is planning to open more of these elevated coffee chains and they will be bigger than the first three Canadian stores. According to "Retail Insider," sources are saying that a large downtown Toronto location could be in the works, which would span more than one level and be more in line with big stores such as a new Reserve/Roastery location in Shanghai."

The biggest store will be opening this year and will have 43,000-square-feet and four floors. This massive Reserve store will be on Michigan Avenue in Chicago and will take up a whole acre of prime city real estate.

Learn more about the Starbucks Reserve stores and the new stores opening in Canada at "Narcity" now.

It makes sense that Starbuck Reserve Bars are taking off because the artisan coffee and tea market is booming. Consumers want beverages with unique origins. Check out the video below where Michael Sheridan, the director of Sourcing and Shared Value at Intelligentsia Coffee and Allen Wang, founder & partner of Kung Fu Tea talk about consumer beverage trends and how their brands are thriving in this saturated artisan drink market.

New Age Bev Launching Cannabis-Infused Drinks for Marley Bev

The cannabis market in both Canada and the U.S. is booming. Since Cannabis containing THC isn't legal federally or on the state level in the U.S., the legal cannabis compound CBD is especially taking off in America.

We have recently reported that a few beverage giants, like Coca-Cola, are looking into developing cannabis beverage lines.

One of those companies, New Age Beverages Corporation is no longer in the development stages. This week, New Age announced that it has created a cannabis-infused beverage for the Marley Beverage Company and will distribute the line in the next few months.

New Age & Marley Bev's new canned beverages dubbed Mellow Mood +CBD are infused with CBD and meant to relax drinkers.

New Age has partnered with Marley Bev, which is named after the reggae legend Bob Marley, into release other drinks and Mellow Mood beverages like the relaxation teas.

The three flavors–Herbal Honey, Lemon Raspberry, and Peach Raspberry have 25 mg of CBD in each 15.5 oz can.

“Marley and cannabis-infused beverages is kind of a match made in heaven,” said Brent Willis, New Age CEO to "BevNET." “In the beverage industry, people buy products based on functional benefits, based on taste, but they also buy based on the emotional connection that they have. With this brand, we are really bottling ‘don’t worry, be happy’ in a can.”

Although CBD is legal, the cans will first be available in Colorado, Michigan, Oregon, and Washington where all cannabis recreational use is legal.

At the end of last year, New Age announced that it was rolling out CBD-infused beverage lines at the 2018 National Association of Convenience Stores (NACS) trade show. The beverages for Marley appear to be part of the company's plan to emerge as one of the biggest players in the cannabis beverage market.

According to Willis, the Marley CBD line was a big hit at this year's Winter Fancy Foods Show and was the company's “most successful show ever.”

Read more about New Age & Marley’s latest venture at “BevNET” now.

We have been following the cannabis trend and specifically the CBD trend closely. Listen to the episode of The Barron report below to learn more about CBD infusions and how this company is thriving with its CBD products.

Sudden Coffee Is Changing The Way People Think About Instant Coffee

Instant coffee may be convenient, but the name traditionally revealed its bitter, inferior, and acidic taste. But, you know we love game changers at Foodable Network and on this episode of On Foodable Feature, we have the pleasure of introducing the exception to the rule.

Instant coffee has always been thought of as a last resort for coffee lovers, but now Sudden Coffee, a food technology company founded in San Francisco, is revolutionizing instant coffee. Co-Founder and CEO, Josh Zloof, graduated from Stanford University in 2008 as an Engineer. He went on to gain experience in multiple fields, including supply chain, lean management, and operations and is responsible for many start-ups, including an email service, an on-demand shopping service, and a coaching company. After experiencing much success and failure, Josh was able to discover what he is most passionate about—serving a delectable cup of coffee while focusing on the convenience and experience a consumer receives.

Throughout this episode, Josh explains how Sudden Coffee’s brewing method and coffee bean selection process differentiates their coffee from most instant coffee brands. In addition to using single origin coffee beans from specialty farms, Sudden Coffee uses a freeze-drying brewing process. This method preserves the aromatic features in their coffee, whereas most instant coffee brands use heat to boil their beans, destroying the flavor.

Not only is their brewing method a differentiating factor in their business, but their pricing is as well. While they currently use a subscription model, their products are available on Amazon and will soon be expanding to stores near you! Sudden Coffee hopes their prices will mirror a shocking $1.50 in the future. Not only are they innovative, but Sudden Coffee is aiming to be the most affordable instant coffee brand out there, as well.