An increasing number of U.S. businesses are concerned with managing their ecological footprint, and in recent years this dedication to going green has trickled down to the U.S. coffee market. In particular, to have a competitive foodservice coffee platform, being environmentally and socially responsible is increasingly important, according to Coffee and Ready-to-Drink Coffee in the U.S.: Retail and Foodservice, 8th Edition, a recent report by Packaged Facts.
To illustrate this point, consider the positioning of these leading coffee foodservice operators:
- Starbucks furthers environmentally-responsible initiatives by building greener with energy-efficient stores, reducing and recycling waste with in-store recycling bins, and sustainable packaging efforts (i.e., sells reusable cups, EarthSleeve).
- Caribou Coffee sources all of its coffees and espresso from Rainforest Alliance-certified farms. These certified farms provide the coffee house with coffee beans that are produced using sustainable, eco-friendly farming practices.
- McDonald’s McCafÃ© moved to double-walled paper cups in 2013 as an environmentally responsible act. As well, in September 2013, the company announced that all McCafÃ© espresso drinks from McDonald’s USA are brewed with 100% Espresso from Arabica
But beyond efforts swirling around the foodservice coffee segment, Packaged Facts predicts in Single-Cup Brew Beverage Products in the U.S.: Coffee Pods and Beyond that improved recyclability and sustainability will become ever more important to the success of the single-cup brew market-if not a cost of entry-as the business matures.
For instance, more environmentally friendly designs for use in K-Cup brewers have been implemented by LPB Manufacturing, Inc. in their UpShot Solution and by Rogers Family Co. in their OneCup capsule design. LBP Manufacturing, Inc. markets the UpShot Solution, as a “flow-through” technology made from 100% polypropylene, which can be recycled with other #5 plastics. Companies and brands using the UpShot Solution include Saxbys Coffee, Mystic Monk Coffee, Red Diamond, Woodshed Roasting Company and Hawaii Roasters. In the office coffee service channel, last fall Mars introduced Freshpacks that use new materials to decrease the carbon footprint by 40%. The new packaging has no aluminum foil layer, reducing what had been a three material package to one fully recyclable plastic.
Recent activity on the merger-and-acquisition front further emphasizes the necessary marriage of retail coffee products with eco-friendly planning. In mid-July 2014, household-products company Seventh Generation-which is known for supplying eco-friendly cleaning products-made headlines when it announced plans to acquire Gamila Products LLC, a company that sells a stainless-steel tea infuser and a single-cup coffee brewer that doesn’t use paper filters. The acquisition is regarded as a shrewd business strategy that echoes efforts by several other makers of packaged consumer goods who have expanded into additional categories.
Long-term, the $48 billion U.S. retail and foodservice coffee market will thrive due to several factors. Chief among them is the reality that America is undoubtedly a nation of coffee drinkers. However, the pervasive desire to recreate coffee shop quality at home and the continued adoption of single-serve brewers in offices and hotels will also be primary catalysts for industry growth. But as mentioned there is little hope for success at either the foodservice or retail level without an eco-friendly strategy. Expect more businesses to follow in the footsteps of Seventh Generation and others.
For more information on Packaged Facts’ catalog of food and beverage reports focused on coffee products, please visit: http://www.packagedfacts.com/food-beverage-market-c84/.
Order Coffee and Ready-to-Drink Coffee in the U.S.: Retail and Foodservice, 8th Edition or Single-Cup Brew Beverage Products in the U.S.: Coffee Pods and Beyond by September 30, 2014 and receive a 5% discount using promo code PFCOFFEE.
-- Daniel Granderson