Will coffee shops survive?

ckeego · 11-05-2021 10:39am #1

I’ve loved coffee for years-a good double espresso or macchiato makes my day and in recent years, the boom in coffee shops has been great to see.

From big firms like 3fe with multiple outlets, growing enterprises like Shoe Lane to the small independent traders operating out of trailers and vans, it’s fantastic to see.

However..how long can it last?

IMHO, there are an increasing number starting to take the pi€€...

€3 plus seems to be the new benchmark for an espresso in Dublin and the real bugbear is this idea that they can charge 50c or a euro for milk alternative..

Seriously-a litre of oat milk is not that more expensive to justify that, particularly when you are already paying handsomely for the small amount of milk in a macchiato. Fair enough if it’s a bedpan of a latte, but this isn’t the case.

€4.15 for one in town today, €1.20 for the same in Rome last week.

Just can’t see it lasting, TBH

lawred2 · 11-05-2021 10:45am

Yeah - I've kinda stopped buying takeaway coffees recently. I buy the odd one on occasion now whereas before I would have gone out of my way to get at least one per day..

david · 11-05-2021 10:51am

They're here for the long haul.

Why shouldn't they charge 50c premium for something that costs x3 as much as dairy milk? These businesses need to maintain a profit margin, if input costs are that much higher, why should they absorb the cost and not adjust the price appropriately?

A coffee shop that does say 200 coffees per day @3.50 - €700 total take - deduct your labour, VAT, rent, rates, packaging, coffee, milk etc, factor in that equipment alone is a capital investment of €20-50k.

Take your italian model of €1.20, would you run this business for €240 revenue per day before costs/VAT?

JustAThought · 11-05-2021 10:58am

There are a LOT more,
mostly pop up coffee places opening now because of the covid. Places that never had anything before like out of the way small locL parks and hidden beaches now have them - and everyone is drifting along with a coffee cup in hand. No harm - why not. I would say it must be much harder for established places to pay their iverheads - rent, corporation taxes based on % of property values,rates, water charges, staff overheads etc than it is for a pop up shop.

I had stopped having a daily coffee when the prices became 3.20+ for a cappuchino - but now the norm seems closer to e3.50 or a fiver for a scone/cake deal. Still - I want my coffee shop to still be in business when the covid is over so I’m happy to support them as they’re mostly small independent family businesses - and I don’t want more bookies, chippers or a starbucks opening up there instead.

We need to support our local community businesses and family run cafés!!!! Even if it costs us 30 cent a day extra!!!

mamaz · 11-05-2021 11:00am

Is there anything to be said for another horse box coffee gig?

Hodors Appletart · 11-05-2021 11:06am

those horse boxes will all be on donedeal this time next year

El Tarangu · 11-05-2021 11:11am

JustAThought wrote: »

There are a LOT more,
mostly pop up coffee places opening now because of the covid. I would say it must be much harder for established places to pay their iverheads - rent, corporation taxes based on % of property values,rates, water charges, staff overheads etc than it is for a pop up shop.

I think local authorities should build more public toilet facilites, and that pop-up coffee shops (and shops/petrol stations that sell coffee, and anyone else selling beverages for immediate consumption) should pay some of surcharge for their maintenance - I think that it's taking the pee (no pun intended) otherwise.

david wrote: »

A coffee shop that does say 200 coffees per day...

I've had any involvement in the business, but I would have thought that 200 coffees per day would be on the low side.

c.p.w.g.w · 11-05-2021 11:11am

In Limerick City where my brother works, his treats himself to a coffee every day in a particular coffee shop, because they have good coffee and their locals(not a chain)...

I think chain coffee places will be a little squeezed, because from my coffee loving friends and family, the coffee on offer is poor and the staff don't give a toss, because they have no interest in coffee...they just wanna turn up, pour coffee and get paid(that's what corporate places do, they suck any individuality out of their staff, and have them as scripted as possible*)

*My experience working in retail chain for a little while, even how you asked for the store card was scripted

JustAThought · 11-05-2021 11:16am

Some of these horseboxes only have one staff /girl - steaming the milk, pressing the beans, making the coffee, putting the sum into the registrar, readying the ATM , fiddling about with lids and serviettes and sugars and sticks...

Ok - there’s nothing else open or to do, but sometimes they can be S L O W

And nobodys getting out anymore so everybodys’s in chat mode. Not that I mind - but it can be M50 rush hour pace service.

El Tarangu · 11-05-2021 11:16am

I enjoy drinking coffee, and the lines outside these horsebox coffeeshops indicate that there are plenty of people willing to pay it, but €3-ish for a coffee seems just about palatable in a coffeeshop where I can sit down and have someone bring it to me (and where I can avail of the facilities if I feel the need), but people charging the exact same price for someone handing you a coffee and 'giddy up, g'luck' really passes the psychological price point for me.

Yyhhuuu · 11-05-2021 11:17am

How can mc donalds do coffee for €2 when other comparable coffees way dearer.

What a waste of money. Thank god I stopped my coffee habit once covid hit. I was prepared to pay €3 daily when I could sit inside with free heat. Not any more. I saved about €1,000 for my holidays.

Tip: invest in a good coffee machine and a good flask. Don't throw your money away.

No such thing as people walking around with coffee cups everywhere polluting the planet years ago. These are same people complaining they can't save a penny.

beertons · 11-05-2021 11:20am

Hodors Appletart wrote: »

those horse boxes will all be on donedeal this time next year

Saw one for sale already for 15k I think.

JustAThought · 11-05-2021 11:21am

I find the standard of horsebox coffee to he very high and the service very good and personable - albeit a bit slow. That being said if you want to press a button in an applewood or spar and get your own squirted at you at a sharper speed then the choice is yours.

I agree totally about prefering to sit inside in a bit of luxury and have a nice bit of ambiance and music and heated bliss - bit these are the times we are in. When the cafés are allowed open properly and have us sit in again that’s when our loyalty to them during the covid crisis will pay off - otherwise it will be roadside coffees and find your own wall & sit in the cold for the foreseable if the nice warm indoor traditional coffee shops arn’t supported properly and can’t financially survive.

If we want nice cosy family run cafes employing our studenfs and teenagers to be there when this is all over then we have to pay the extra twenty cent and give them our support to keep them going. It’s not as though most of them are selling meals or sambos out the hatch - they are trying to pay all their taxes, rents and overheads while only selling the bare minimum of their normal service or product range - it can’t be easy for them.

Keyzer · 11-05-2021 11:22am

I'll probably sound like an aul bjollox saying this but the takeaway coffee game in Dublin is beyond ridiculous for two main reasons:

1. The cost is astronomical for a cup of coffee in Dublin...

2. The quality, for the most part, is dreadful...

I got a moka pot about a year ago, best purchase I made. Made me realise how easy it is to make a superb cup of coffee at a fraction of the cost of takeaway. And astounded me how so many establishments manage to make a sh1t cup given the price your paying.

JustAThought · 11-05-2021 11:31am

Well if you’re drinking awful coffees then you’re going to bad places. Not everyone likes their coffee the same but there are lots of great different coffee places out there that will make it however you like it.

And Sure - I can sit at home and boil a kettle and make nice cup of instant coffee and it dosn’t cost me e3.20 a cup and it tastes ok. But if I factor in the monthly mortgage, the electricity bill, the insurance on the house, the price of my kettle, the cost of the overhead on the car to drive to the supermarket and the cost of the insurance, tax and petrol on the car to do that every day then the proce of that daily coffee becomes a lot more.

Cafes then also have to have specialised equipment, health and safety licenses and HSE inspector visits, public liability insurance, PAYE overheads, employer tax, maternity pay, holiday pay, pension contributions, etc etc - and yet mostly provide a warm ambient attractive local and convenient place to go and hang out for an hour or so. Not bad for e3.20 per table.

11-05-2021 11:32am

I'm not a coffee drinker but am amazed at the proliferation of coffee shops and huts etc. over the last 10 years. Fair play to them for trying to make a success of their new businesses but it seems like every 4th or 5th shop these days is a coffee shop.

To a non-coffee drinker like me it looks unsustainable but who knows...

Flinty997 · 11-05-2021 11:34am

ckeego wrote: »

....

Just can’t see it lasting, TBH

Queues out the door and around the corner at peak at most of the coffee shops I see, and mobile ones in popular locations. While the volume overall must be down. But it must be viable otherwise they would be closed.

PMBC · 11-05-2021 11:39am

Coffee OK thats something. But what about the price of a tea bag in a cup of hot water? €2.50 takeaway in a garage I frequented early in the year. Cant remember the name of the franchise.

Flinty997 · 11-05-2021 11:44am

PMBC wrote: »

Coffee OK thats something. But what about the price of a tea bag in a cup of hot water? €2.50 takeaway in a garage I frequented early in the year. Cant remember the name of the franchise.

Was that not always the case for buying a cup of tea out though. Its just a cup of hot water. Tea drinkers also want to get a cup tea when they are out.

david · 11-05-2021 11:46am

Yyhhuuu wrote: »

How can mc donalds do coffee for €2 when other comparable coffees way dearer.

Because bean-to-cup machines don't need to be paid the same labour rate.

El Tarangu wrote: »

I've had any involvement in the business, but I would have thought that 200 coffees per day would be on the low side.

Absolutely not, there are a lot of cafés in Dublin city doing far less volume than this. These numbers would be accurate for a busy, one man operation in Dublin City with excellent footfall.

There's a lot of work making a coffee, clean portafilter, grinding beans, tamping, get cup, draw espresso, get milk from fridge, pour, purge and steam for 20 odd seconds, clean wand, swirl and let settle, pour, clean jug, serve, give lids sugar etc, run through till, take payment, close check.
I'd challenge anyone here to try that for 8 hours per day and tell us the price they charge is a rip-off.

You get what you pay for, if you drink coffee for caffeine, stick to the instant Nescafé. If you drink because of the taste and experience, pay the premium and support your local economy.

This argument is like saying why would you go to a bar and drink a nice glass of wine when you can get blackout drunk at home on Tesco vodka for a fraction of the cost.

Tabnabs · 11-05-2021 11:53am

I hope that the upshot of this spotlight on coffee (and tea) means an improvement of the cafe culture that so eludes us here in Ireland.

But at €3.50 for a coffee I want a seat, wifi, heating, a roof to keep me dry.

El Tarangu · 11-05-2021 11:55am

david wrote: »

There's a lot of work making a coffee, clean portafilter, grinding beans, tamping, get cup, draw espresso, get milk from fridge, pour, purge and steam for 20 odd seconds, clean wand, swirl and let settle, pour, clean jug, serve, give lids sugar etc, run through till, take payment, close check.
I'd challenge anyone here to try that for 8 hours per day and tell us the price they charge is a rip-off.

Fair enough

david wrote: »

This argument is like saying why would you go to a bar and drink a nice glass of wine when you can get blackout drunk at home on Tesco vodka for a fraction of the cost.

In a coffeeshop, maybe. But not a takeaway portacabin coffee; a better analogy would be paying the same price for glass of (nice) wine handed to you in a plastic cup that you have to drink standing up, as you would pay for a nice glass of wine in a bar where you can sit and enjoy the ambiance.

alksander · 11-05-2021 11:56am

ckeego wrote: »

€4.15 for one in town today, €1.20 for the same in Rome last week.

I'm not sure the 1.20 euro espresso in Rome can be compared to a "third wave" cappuccino/latte. They are very different things. The cost of a "third wave" (will explain below)

To go into a tiny bit of detail, they are very different cultures of coffee, using very different ingredients. The Italian style espresso goes mostly for dark roast (or medium roast), where the subtleties (and more importantly quality) of the beans are less visible. This means cheaper beans can be used. Some of the very popular "old style espresso" brands also use a blend of arabica and robusta beans. The latter again is a much cheaper variety. (There are also many varieties of arabica itself, and the location where it is grown matters a lot.)

Some of the places you have mentioned, like 3fe and shoe lane, are "third wave" coffee places using much more high quality coffee beans and use light (or medium) roast. This means the qualities and flavours are much more pronounced, and low quality beans can't be used. The high quality ones are usually hand picked and sorted too, adding to the costs. These beans go at the minimum for 9 euro per 250 grams, but can easily reach 18 euros per 200 grams. It depends on how rare the beans are and where the roaster is located, i.e. some nordic roasters are pretty expensive due to labour costs. La Cabra from Denmark for example is very popular, and they are on the expensive side.

After all this long intro, usually something between 18-21 grams of ground coffee goes into an espresso, which calculating with the cheapest 9 euro bag means the coffee beans alone cost 65 cents in your cup!

Btw, the 3 - 3.5 euro mark is pretty common across Europe for these coffees, it is mostly the universal price. What is horrendous though that those old style places using the cheap beans charge the same in Ireland.

El Tarangu · 11-05-2021 11:57am

Tabnabs wrote: »

I hope that the upshot of this spotlight on coffee (and tea) means an improvement of the cafe culture that so eludes us here in Ireland.

I've said it before, but history will look kindly on Michael McDowell - we could have this already if the vintners had had not torpedoed his café bars.

ckeego · 11-05-2021 12:03pm

david wrote: »

They're here for the long haul.

Why shouldn't they charge 50c premium for something that costs x3 as much as dairy milk? These businesses need to maintain a profit margin, if input costs are that much higher, why should they absorb the cost and not adjust the price appropriately?

A coffee shop that does say 200 coffees per day @3.50 - €700 total take - deduct your labour, VAT, rent, rates, packaging, coffee, milk etc, factor in that equipment alone is a capital investment of €20-50k.

Take your italian model of €1.20, would you run this business for €240 revenue per day before costs/VAT?

Because alternative milk isn’t 3 times the price.

And your math doesn’t include what in effect you are already paying for ordinary milk.

Furthermore, the Italian shop has a similar overhead.

Just another example of rip off Ireland

ckeego · 11-05-2021 12:09pm

Keyzer wrote: »

I'll probably sound like an aul bjollox saying this but the takeaway coffee game in Dublin is beyond ridiculous for two main reasons:

1. The cost is astronomical for a cup of coffee in Dublin...

2. The quality, for the most part, is dreadful...

I got a moka pot about a year ago, best purchase I made. Made me realise how easy it is to make a superb cup of coffee at a fraction of the cost of takeaway. And astounded me how so many establishments manage to make a sh1t cup given the price your paying.

Wholly agreed point 1.

Point 2.. Open to debate. Places like 3fe have increased the attitude but greatly lowered their quality. The arrogance of some staff in these places is unreal. It’s as if you are intruding on their Influencing as a customer.. Seriously dude!? You want a coffee? Can’t you see I’m posting on Insta here??

ckeego · 11-05-2021 12:13pm

Flinty997 wrote: »

Queues out the door and around the corner at peak at most of the coffee shops I see, and mobile ones in popular locations. While the volume overall must be down. But it must be viable otherwise they would be closed.

That’s the present..

The point I’m making is when we likely hit what may be one if the biggest recessions and businesses realise 50 folk in an office can be replaced by 30 gophers working from home will folk still be walking around with a 3 gulp €4.15 macchiato?

Mister Vain · 11-05-2021 12:13pm

They seem to be popping up everywhere and there's often long queue's so they're obviously doing well. My favourite is PS Coffee Roasters and it just happens to be one of the cheapest.

Xterminator · 11-05-2021 12:18pm

if you own a coffee shop and see a shop on the same road is charging 4€ a pop - and thriving, then your going to up your prices to close that.
As long as there is a large cohort of people willing to pay €4 - then thats the going rate. likewise - if your number drop off, and customers who used to come in everyday, drop in once week, and tell you its all a bit expensive, then you look at lowering your prices. Its market forces at work.

There isn't a builder in ireland who will sell houses 30% cheaper than the competition for reasons of principle. Why should a coffee shop?

Yyhhuuu · 11-05-2021 12:19pm

JustAThought wrote: »

Well if you’re drinking awful coffees then you’re going to bad places. Not everyone likes their coffee the same but there are lots of great different coffee places out there that will make it however you like it.

And Sure - I can sit at home and boil a kettle and make nice cup of instant coffee and it dosn’t cost me e3.20 a cup and it tastes ok. But if I factor in the monthly mortgage, the electricity bill, the insurance on the house, the price of my kettle, the cost of the overhead on the car to drive to the supermarket and the cost of the insurance, tax and petrol on the car to do that every day then the proce of that daily coffee becomes a lot more.

Cafes then also have to have specialised equipment, health and safety licenses and HSE inspector visits, public liability insurance, PAYE overheads, employer tax, maternity pay, holiday pay, pension contributions, etc etc - and yet mostly provide a warm ambient attractive local and convenient place to go and hang out for an hour or so. Not bad for e3.20 per table.

Do you own a coffee shop? No matter what you say homemade still costs a TINY FRACTION of the cost of bought coffee.

Invest in a good coffee machine and good flask save thousands towards your holidays etc not wasted on bought coffee.

Disgraceful to see the amount of coffee cups around the place destroying the environment

El_Duderino 09 · 11-05-2021 12:38pm

I've always been a bit shocked at how coffee has become such a big event. I drink coffee for the caffeine in work. Coffee is a grand, bitter, slightly unpleasant vehicle for the caffeine. The way people consider themselves to be experts in what's good coffee and what isn't, reminds me of when we were teenagers and the smokers talked about hoe Carrols were lovely and Benson were horrible. These things are all about the experience of enjoying taking some time out of the day to get the fix of the drug in the coffee/cigarette/beer. If there wasn't a drug involved in coffee, there wouldn't be the whole rigmarole around what's a good cup and what isn't, or putting up with really poor service in the coffee shop but still really looking forward to going to the same coffee shop.

I worked out how much it costs to get a coffee in the morning and one at lunch every day in work and i just bought a plunger or the office. very convenient and delivers that bitter caffeine hit for probably 30c a cup when i need it.

I presume coffee shops will be big business for as long as people keep wanting the drug at the centre of it. It's not just the drug though, it's in the culture as a generally good thing to be doing too. So i presume coffee shops are here to stay.

Will coffee shops survive?

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