Supply chain should wake up and smell the coffee

Customers constantly want something new, competitors are on our coat tails and it’s not easy coordinating a nationwide expansion programme that saw us open 160 new stores last year.

I’ve spent more than 25 years in commercial property, most of it in the hospitality industry with the likes of Costa and Whitbread. The biggest lesson I’ve learned is the foundations for a successful real estate-hungry business like ours are innovation and partnership.

Any successful brand will be innovating all the time through new products, new services and the new experiences it can provide for its customers. The most enduring and powerful brands combine tradition and integrity with innovation and modernity. Stand still and you are going backwards, as they say.

In our business, that means finding new formats, new locations, new store environments and those property and design solutions that amplify our brand and put our products in front of our customers in a way that’s right for them. So what does that mean for the market? It means we need space, first and foremost, then we need landlords, development partners, agents, franchise partners and everyone in our supply chain to be able to move at the pace we need to stay relevant.

Today we have around 130 coffee shops on retail parks and more than 250 concessions in stores such as Next and Tesco. Until relatively recently, landlords and developers didn’t really get the value we could bring and the type of space and service we needed from them. We were pushing boundaries when we started; now it’s commonplace. We led, the supply chain adapted, and we now have fruitful relationships with partners who see the mutual benefit.

It might also be illuminating that more than half of our UK coffee shops are on turnover rents. That works for us and it works for our landlords. Having adversariallandlords and tenants doesn’t cut it in our business, it adds time and cost. We want to work as part of schemes to create footfall, broaden the options and experiences available to shoppers, and participate in collective success. The value we create is now well recognised.

Building on the spirit of partnership, we have just opened a pioneering new ‘eco pod’-format Costa within a zero-energy building. With Hammerson, we have both put in more than is conventional to deliver a potentially revolutionary new building. What we are learning could be scaled significantly.

I’m proud that, in the UK, we have built a business made possible by the quality of service we can access in the market. Occupiers with clear propositions such as ours benefit from a responsive property supply chain. Innovation and commercial property can exist in the same sentence. People have realised change is good and the pace of change is an opportunity not a barrier. Last month, we pressed ‘go’ on a £36m new coffee roastery in Basildon. The support we received from the industry to make it happen was second to none.

By focusing on and appreciating occupiers’ need for innovation and partnerships, the market will continue to serve businesses like ours well — and generate benefits at the same time. As we look to open more stores this year, I see a considerable number of opportunities to embed these principles still further and for us to play our part in delivering value for the people helping us to deliver for the people that matter most to us — our customers.

Clive Bentley is global property & commercial director at Costa Coffee