The UK-based coffee chain has credited new stores, retail partnerships and a growing delivery presence in the UK as boosting sales during its first quarter of 2022, but warns of significant economic headwinds ahead
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Caffè Nero said delivery sales grew by 10% between June and September 2022 | Photo credit: Caffè Nero
Caffè Nero has announced robust trading for the first four months of its financial year, with sales at 107% of pre-pandemic levels.
Covering the period from June to September 2022, the company said it achieved strong like-for-like sales growth and progressed both its store expansion and outlet refurbishment programmes.
Caffè Nero opened 14 new stores during the period, including a flagship store in Stansted Airport. The site recorded the highest level of sales in its first week of any Caffè Nero store in the company’s history.
The company, which operates over 1,000 stores across 10 countries, including more than 650 across the UK, is forecasting a further 18 new outlets during its second quarter this year.
Caffé Nero also initiated a substantial refurbishment programme earlier this year which has seen an initial 200 stores upgraded in the last six months. A further 60 stores are scheduled for refurbishment before the end of 2022.
In May 2022 Caffè Nero announced a new partnership with Just Eat to tap into the delivery platform’s significant UK reach. The company said delivery sales grew by 10% between June and September 2022.
Furthermore, the UK coffee chain said more than 30% of all UK store transactions now take place via the Caffé Nero app.
However, Caffè Nero said ‘substantial economic headwinds’, particularly in the UK, would likely impact the business during the winter. The chain highlighted that new partnerships, including with UK retailer Waitrose, would be key to maintaining sales momentum in the coming months.
“We’ve seen a very encouraging first quarter of sales. Customers really embraced our new range of iced drinks during the hot summer with sales up 55% LFL, the Iced Pistachio Latte being particularly popular. We also saw very strong coffee sales throughout and growth in food attachment. Despite the challenging conditions the whole country is facing, I’m confident we can have a successful autumn and winter and capitalise on strong new brand partnerships, an exciting festive menu and our new store openings programme,” said Gerry Ford, CEO, Caffé Nero.
Founded in 1997, Caffè Nero is the largest independent coffee house group in Europe. It is third largest operator in the UK, behind Costa Coffee and Starbucks, and seventh largest in terms of outlets across Europe.