The UK specialty coffee roaster and subscription service achieved significant sales growth in the fourth quarter of 2023 following its first supermarket listing, with new retail distribution deals expected to perform strongly
Pact Coffee forecasts it will achieve double-digit sales growth across all channels in 2024 | Photo credit: Pact Coffee
London-based Pact Coffee has hailed the success of its multi-channel strategy after its first supermarket partnership with Waitrose significantly boosted in the final quarter of 2023.
Following two years of flat sales growth, B Corp-certified Pact Coffee achieved a 2% year-on-year rise in the 12 months ending 31 December 2023 to reach £11.7m ($15.6m).
Highlighting the success of Pact’s first retail listing with premium UK supermarket chain Waitrose in October 2023, fourth quarter sales rose 19%.
Business-to-business (B2B) channel growth and an uptick in direct-to-consumer sales during the latter part of the year also offset lower first-half sales.
Full-year EBITDA increased 260% to £325,729 ($434,888), despite a 2% fall in gross margin due to higher arabica coffee prices.
“As many returned to the office and drank less coffee at home, we expected to see a dip in direct-to-consumer sales over 2021 and 2022 following a 2020 surge. But we withstood this challenging post-pandemic world prudently over the last two years while many direct-to-consumer companies folded. That’s no mean feat, and I’m thrilled that we’ve returned to growth so quickly afterwards, considering the year’s many challenges, like inflation, rising green coffee costs, and volatile exchange rates,” Pact Coffee CEO Paul Turton told World Coffee Portal.
Founded in 2012 as a direct-to-consumer coffee subscription, Pact Coffee has pursued a multi-channel strategy by introducing B2B and supermarket sales channels. In 2024, Pact Coffee signed distribution deals with premium retailer Whole Foods Markets and grocery delivery firms Ocado and Gopuff.
Pact Coffee forecasts it will achieve double-digit sales growth across all channels in 2024, with e-commerce and a popular Christmas range expected to perform strongly. Despite ongoing coffee price volatility and higher costs, the specialty coffee roaster is also forecasting further full-year EBITDA growth.