TO GO MARKET
Ups and downs for ‘to go’ market T
he ‘to go’ market has been a staple within public and workplace sites since its introduction, providing the solution for demands from consumers for easily accessible services.
However, according to the Vending & Automated Retail Association (AVA), circumstances within the market, including demand for more convenient products, brand loyalty and hostile competition, means that certain limitations have developed in order for brands to succeed in the ‘to go’ industry. Whilst an overall market growth of 16% since 2020 is positive, it hasn’t been without its challenges, says AVA chief executive David Llewellyn. According to the AVA 2021 census, the to-go coffee market gained a total base of 27,900 machines, which is a 7% increase since 2020, and generated £570 million in 2021. Costa Express has the largest market share with almost 12,000 machines with other retailers such as Nescafe, Starbucks, Tchibo and Lavazza sharing an additional 11,000 machines. Consumption from these machines increased by 7% in 2021 according to the AVA census figures, highlighting the ongoing demand for quick service coffee. “However, with larger suppliers monopolising the prime locations for vending machines, workplace settings and leisure centres, it’s making it more difficult for smaller suppliers to make an impact,” said Mr Llewellyn.
RISING COSTS
He adds: “Rising costs are also causing headaches with an average price increase of 5% for drinks in 2021. Whilst the total product revenue of £570 million may seem like an impressive figure, it is significantly lower than 2019’s revenue of £635 million which suggests the industry is still recovering from the Covid-19 pandemic. “There are hurdles in the way for the coffee to-go market to
really thrive, and whilst there are signs of small growth there are definitely still challenges to navigate. However, there are untapped opportunities for vending and automated retail in the market, as the need to diversify and keep up with changing customer preferences opens the door for new ideas and product innovation.” National sales director of quality disposables manufacturer and supplier Herald, David Martin also puts rising costs on top of the list of challenges including costs of raw materials, ingredients and transport.
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in order to make any profit as all the components that make up the end product now have extra costs attached. “For vending operators and food and drink ‘to go’ providers, it’s
about finding a line between how much cost to shoulder and what can reasonably be passed on to the consumer, who is being hit on every level. “As a packaging and cup supplier to this market, Herald is doing
all that it can by making sure that we have a ready supply of the widest selection of products to ensure that our customers are not restricted by a limited choice. We understand that there needs to be varying price points and supply to fit all budgets.
ADVANTAGES “On a positive note, the ‘to go’ market has a great advantage in that it historically stands for affordable treats. Consumers will cut out takeaways and meals out in order to pay bills and to continue to access holidays, where possible. However coffee and snacks on the go are viewed as smaller, less luxurious treats and so don’t have the same level of guilt attached. There will always be a market for these items. “The affordability factor is key though and we all have to pull together, where possible, to ensure that these comparatively small treats remain accessible to the majority.”
There are many advantages for the ‘to go’ market’, but the sector also faces its fair share of challenges. VI consulted some experts in the field to find out what the outlook is for the industry.
“Many companies are currently struggling to get their pricing right
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