Article Excerpt:
TWST: Can we start with a little history and an overview of Caffe Nero?Mr. Ford: The company began in 1997 as a startup in the coffee house industry. When we started out, the UK coffee house industry was very small, particularly the branded element of it. From five stores in our first year we now have 201 as of March 2005. The overall branded industry has gone from literally about 10 million pounds to now worth about 720 million pounds sterling. And it has been growing double digits the entire time and is expected to grow double digits at least for the next three years, when it's anticipated that the branded element will reach 1 billion pounds. The overall coffee bar market, including the independents or the local cafe, is currently worth about 2.2 billion pounds, and that has grown massively as well.
TWST: Who are the biggest players in the market?
Mr. Ford: The three dominant players are Caffe Nero, which is a
European/Italian style coffee house and different from anything that
exists in the United States, Starbucks, which everybody knows very well,
and a group called Costa Coffee. The three of us control about 57% of
the branded market. So it's already a very consolidated market. Among
the three, the group that is gaining market share the fastest is our
group, Caffe Nero, which has gained the most market share over the past
three years just short of 6%. Starbucks has gained about 4.5% market
share over the last three years, and Costa Coffee has been losing some
market share to the two of us.
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