by Cara Rasch
May 22, 2024
The office coffee scene may be evolving, but one thing remains constant: the desire for a great cup of coffee.
In the pre-pandemic era, office coffee service revenues grew steadily, fueled by job growth and a focus on employee perks. However, the COVID-19 pandemic triggered a sharp decline as remote work surged and offices were closed or operating at a limited capacity.
According to Packaged Facts’ new May 2024 report Office Coffee Service in the US: Market Trends & Opportunities, the $2.49 billion office coffee service market is poised for average annual growth of 17.2% through 2028 as recovery of lost revenues continues from a still-low 2023 base of sales.
The scope of analysis is centered on office coffee service provision and employee office coffee use and attitudes. While there is a focus on businesses that operate office environments, many other businesses also offer free on-site coffee service to their employees, such as:
While a return to normalcy is driving some recovery in OCS revenues, the "new normal" involves a smaller office footprint. Fewer employees in the office means fewer cups of coffee being brewed, presenting a significant challenge for traditional OCS models.
To adapt, OCS suppliers must utilize new strategies for growth. Plenty of opportunities exist to target new markets and cater to evolving preferences.
Just because employees aren't in the office doesn't mean they don't crave coffee! OCS companies can reach remote workers by offering coffee subscriptions that are delivered directly to their homes. This can be a valuable perk for employers looking to boost morale and productivity among their distributed teams.
Though offices have traditionally been the largest market for OCS, providers must think beyond the office and target other markets such as hospitals, manufacturing facilities, co-working spaces, and schools. Expanding reach beyond the office can be a great way to diversify the client base and ensure continued growth.
Millennials and Gen Z are now a dominant force in the workforce, and their preferences are shaping office coffee culture. They tend to favor specialty coffees, cold brew and espresso-based beverages, plant-based creamers and dairy alternatives such as oat milk, and ready-to-drink options. OCS providers that can cater to these evolving tastes will be well positioned to attract and retain younger employees for their clients.
Sustainability is a growing concern surrounding coffee and packaging, particularly for younger consumers. Young adults are looking for eco-friendly packaging, ethically sourced coffee beans (fair trade, shade grown), and even sustainable alternatives to traditional coffee, like bean-free coffee or mushroom or adaptogen-infused drinks.
The office coffee scene may be evolving, but one thing remains constant: the desire for a great cup of coffee (or a satisfying alternative) to fuel the workday. By embracing these trends and adapting their offerings, office coffee service providers can ensure they stay relevant and continue to be a valued partner in creating a positive workplace experience.
About the blogger:
Cara Rasch is a food and beverage analyst for Packaged Facts. She studies consumer and industry trends in this space and has a B.A. in economics from Allegheny College.
Additional analysis on the office coffee service market can be found in the May 2024 Packaged Facts report Office Coffee Service in the US: Market Trends & Opportunities.
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