With Christmas fast approaching, consumers across the UK will be hitting their nearest high street in order to purchase gifts for friends and family, greatly boosting the festive spirits of retailers nationwide. However, with the chill of winter settling in for the long haul, these shopping trips will often be broken up by the need for hot drinks – something which coffee chains such as Costa Coffee will capitalise on in order to continue its strong run of sales increases.
The UK’s most popular coffee shop has already seen great success in the past quarter, posting a 20.4 per cent lift in total sales during the 13 week period culminating on the 28th of November. Furthermore, same store sales climbed by 4.9 per cent, indicating that it is not simply the chain’s recent run of new store openings which has seen consumers reaching for a latte.
So far this year, parent group Whitbread has opened 133 new Costa outlets in the UK, significantly contributing to the 246 new total openings worldwide. However, this number is expected to increase in the next few months following the huge success of the third quarter.
Also playing a starring role in Whitbread plc.’s recent growth is the Premier Inn hotel chain, especially in London, which saw revenues increase by 16 per cent thanks to the addition of an extra 10 per cent of rooms available. Outside London, performance waned a little with a revenue boost of 13.5 per cent – yet this is still an extremely positive result in a highly competitive industry.
Altogether, a total of 22 new branded Premier Inn hotels opened in the UK this year. However, Whitbread has been forced to scale back the number of rooms it intends to open from 4000 to 3500 due to a delay in the completion of its new 270 bedroom hotel in central London.
Whitbread chief executive Andy Harrison explains that new store and hotel openings played a considerable role in the group’s strong third quarter results.
He says; “Whitbread has delivered another strong quarter.
“Our network expansion, as we deliver our growth milestones, combined with a strong focus on returns should continue to generate substantial shareholder value and create many new jobs.”
Overall, Whitbread group results were extremely strong, marred only by its restaurants division which saw only small increases. Total group sales rose by 13.8 per cent, leading analysts to believe the group will certainly meet, and possibly even exceed, its top range targets for the 2013-2014 financial year.
With Costa Coffee proving to be a runaway success on the high street in the approach to Christmas, it is fairly safe to assume that the fourth quarter will continue on from the third quarter in terms of increased profits and sales.
Do you tend to drop into Costa Coffee when doing your Christmas shopping, or do you prefer to patronize smaller independent coffee shops?
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