According to related media reports, due to the decline in customer traffic, the old British coffee chain Costa has also joined the closing "camp". In September last year, Costa closed about 10 percent of its stores in several Chinese cities. Among them, Qingdao store has been closed. In addition, six of the 22 stores in Nanjing have been closed, Hangzhou, two stores have been closed. This means that Costa has experienced a large-scale contraction for the first time since it entered China in 2006.
Another coffee service industry is in the same situation, and that's Diffuse Coffee. I'm sure many of you are familiar with Diffuse Coffee. It epitomizes a generation of coffee chains, so to speak. But now it's in decline. About 60 percent of Man Coffee stores in Beijing have closed, and some other cities have also seen closures.
In the past, coffee shops did well. It seemed to be as profitable an industry as milk tea. But now, why can't it continue? In fact, the reason is not difficult to analyze.
Some industry insiders pointed out that, on the one hand, may be affected by the epidemic, people prefer "instant coffee" and "canned coffee". On the other hand, with the rapid development of the network field, people began to choose "takeaway coffee". As a result, the launch of coffee retail products and the development of coffee brands using e-commerce as the main sales channel have been accelerated. This year, a number of convenience coffee brands have received financing, and some coffee brands have closed their offline stores and begun to transform themselves online.
From the above, it can be seen that consumer demand for coffee has not changed, but consumers have more choices, which may be one of the reasons why it is difficult for offline coffee brands. During the epidemic, the impact of the epidemic, difficult to profit offline stores is even worse. As a result, under the impact of the epidemic, the closure rate of the coffee service industry reached 83.3%.
An investor in an offline coffee brand said that the first two months after the resumption of work, he thought that the coffee shop finally ushered in the dawn, but in fact, the business situation is particularly unsatisfactory, "in Wangjing a coffee shop, less than 30 people come to drink coffee every day," he said that if he did not open the store, there is no source of income. However, few people come into the store when it is open. Instead, he must pay rent, electricity and labor as usual.
There are many small stores that have closed in the process. The root cause of the coffee industry's offline store woes is the high cost of staff, rent, decoration, equipment and materials. The coffee business is similar to the restaurant business and is not suitable for rapid investment and expansion. Coffee brand as a service product, its own brand established a very short period of time, has not yet formed enough eye-catching customer recognition of value points.
Secondly, the loss has a lot to do with the positioning of the coffee shop. If the main single multi-consumption "third space", suitable for the afternoon and friends together, customers sit all afternoon, then the turnover rate of the cafe is very low, it is difficult to make a profit, so rely on the meal to increase consumption, improve the unit price. However, in this model, many people stay in the store for an afternoon and leave before dinner, only ordering a cup of coffee and rarely ordering a meal. The reason is that sandwiches and cakes are more expensive here. High cost, low turnover, and difficulty in making a profit are the three main characteristics of the offline model coffee shop. In the long run, there is only one result: closure.
So, what is the future of offline coffee shops? Undeniably, the offline development strategy of the coffee brand needs to be adjusted. If it remains a traditional offline coffee shop, it is generally difficult to make a profit. Therefore, the traditional coffee shop has ushered in an era of change. Therefore, under the new business model, store rent, labor and other costs need to be further optimized in order to continue the story of offline coffee.
Regardless of how the external environment changes and how the industry changes, it is certain that in the next few years, the success story of coffee still belongs to those brands that are focused on doing a good job of making coffee, and really have the ability to channel and product.