Coffee shop markets in focus: Benelux

Belgium, Luxembourg and the Netherlands were quicker than most European countries to relax pandemic restrictions in 2021, enabling these branded café markets to get ahead of the curve in terms of recovery and a return to normal trading. Project Café Benelux 2022 reveals the branded coffee shop market achieved net store growth of 64 to reach 1,291 outlets, with 73% of industry leaders surveyed positive about the current trading environment

The branded café market in Benelux has the potential to expand significantly as demand for coffee grows | Photo credit: Stephanie LeBlanc

The Benelux branded café market, comprising Belgium, Luxembourg and the Netherlands, is small in comparison to neighbouring European markets with its total 1,291 outlets around one third the size of the French market and a quarter of the German.
Nevertheless, new data from Project Café Benelux 2022 indicates the market has the potential to expand significantly as demand for coffee and branded cafés grows.  
With Covid-19 restrictions, such as mask wearing mandates and trading limitations, eased earlier than many neighbouring European countries, it is unsurprising that the Benelux branded café market adapted quickly and effectively to new operating realities.
In 2022, the market achieved 5.2% growth, adding by 64 net outlets. The coffee-focused segment led growth, expanding 2.1%, or 59 outlets, to reach a total of 468 stores. 
Dunkin’ was the fastest growing coffee chain across the region over the last 12 months, increasing its presence from 37 to 79 outlets.
The region’s three largest coffee-focused chains all achieved store growth across the period, with Panos opening two new net outlets for a total of 272, Délifrance opened 16 net outlets for a total of 185, and Starbucks opened five net outlets for a total of 127.
There is a strong tradition of coffee drinking among consumers across the region, with 96% of World Coffee Portal’s 2,000+ respondents consuming coffee – 83% daily.
Market stability generates industry optimism

Although the Benelux market was adversely impacted by Covid-19, industry leaders surveyed expressed optimism about current trading conditions.
 Nine in ten industry leaders say consumers should feel safe to visit coffee shops in the Benelux region, with only 8% fearing a long-term negative impact for consumer desire for coffee out-of-home as a result of the pandemic.
This positive view of the market was reflected in greater consumer confidence about visiting coffee shops, with just 12% of those surveyed indicating they did not feel safe visiting a coffee shop.
Even as cases of the Omicron variant were spiking in late 2021, 73% of industry leaders reported feeling positive about the trading environment for coffee shops in Benelux, with 77% of operators enjoying a sales uplift since 2021.
Furthermore, industry leaders report that consumer education on premium and specialty coffee has grown and demand for high-quality beverages at coffee shops continues to rise. The vast majority (73%) of industry leaders agree that consumer appetite for specialty coffee has increased over the last 12 months.
Leaders also reported customers appearing more loyal to domestic brands because of an increased desire to support local businesses and a shift away from city centre working, where café chains are more prevalent, due to the pandemic. 
This is reflected in the popularity of specialty cafés in the region, such as 30ml Coffee Roasters, which has 13 outlets across the Netherlands, Antwerp-based specialty coffee house Vascobelo, which now operates 26 stores in the region, and Luxembourg’s Golden Bean, with five stores in its home market and two in Belgium.
Covid safety measures popular despite restriction objections
The Benelux at-home coffee market is also experiencing growth, particularly among a more cautious older population who may be more reluctant to return to stores in-person despite the relaxing of restrictions.
This has often been at the expense of reduced footfall in stores and fluctuating sales, although the craving for something indulgent and a desire to relax remain key motivators for consumers to resume out-of-home beverage purchases.
In fact, 68% of Benelux consumers surveyed maintain that a beverage handmade by a barista adds value to purchases.
Cashless-only payment and improved ventilation policies (69%) are the safety features commonly implemented during Covid-19 that industry leaders feel will outlast the pandemic, ahead of expanded outdoor seating (60%) and beverage delivery (54%). 
Most consumers (48%) agreed that hospitality closures were effective in halting the spread of Covid-19, with 24% disagreeing with the sentiment.
Hospitality recruitment remains a headwind
Despite positive market performance following the pandemic, obstacles to growth remain. Leaders report challenges in retaining and recruiting staff, and an overall shortage of qualified staff who are interested in a career in hospitality.
Businesses are facing demands for higher wages as employee power increases amid hospitality sector shortages, with the migration of a workforce seeking employment in other industries.
This poses a major problem as obtaining finance is a growing challenge for operators in Benelux, as some have accumulated debts throughout the Covid-19 pandemic, which they may now find difficult to repay. Others noted rapidly increasing prices across goods, raw materials and energy as major headwinds for the year ahead.
Coffee-focused chains expected to lead growth
World Coffee Portal anticipates that a trend towards higher quality coffee at home may challenge the out-of-home market in the medium-term. Nevertheless, the branded chain market is expected to exceed 1,500 outlets by 2027, with the coffee-focused segment expected to lead growth to more than 620 outlets over the next five years.

Project Café Benelux 2022 is World Coffee Portal’s annual deep-dive study into the branded coffee shop markets in Belgium, the Netherlands and Luxembourg.

The report features market sizing and growth forecast, Covid-19 impact analysis, industry insight and a consumer study of more than 2,000 coffee shop visitors across the three nations.

To purchase the report or to make an enquiry, please contact: | +44(0)20 7691 8800

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