But while it's relatively easy to get a single site operation up and running, it's quite another matter to get to the stage that Costa has reached. This is a concern that started with the efforts of two brothers, Sergio and Bruno Costa, who set up a business supplying roasted coffee to caterers and Italian coffee bars in 1971. They plunged into cafés in 1978, when the first branch opened in London.

The company was acquired by Whitbread in 1995 - at the time Costa had just 41 stores nationwide, so the great bulk of its growth has taken place within the last decade. Today there are around 430 UK outlets.

Costa's property director, Chris Bentley, says that the chain is expanding at the rate of "about one every three to four days - we passed the 400 mark just before Christmas." Around 60 Costas are in shopping centres and Bentley says that the intention is to expand in this area. He comments: "It's not enough just to have A1 retail in a shopping centre. People need a break as well." Backing up this assertion he points out that in the financial year that has just ended in February, 19 branches have been opened in shopping centres including thecentre:mk.and Luton's Arndale centre.

As far as an overall property strategy at Costa is concerned, there are two business models: equity-owned units and franchises. Bentley says that the equity-owned outlets, company-owned, are what is found in almost every shopping centre.

So why is this a successful brand and is it likely to find further favour in shopping centres? The answer to the first question must lie, in part, in the fact that this is a coffee brand with a real heritage: "We are a historic coffee brand. We're not a made-up brand created by some marketeer," as Bentley puts it. It is also a brand with distinct attributes. From the "baristas" (people who make coffee), to the louche ABC1 females sipping skinny lattes on dark leather sofas, this is a coffee retailer that is located firmly in the luxury end of the market, although its prices are distinctly mid-market. Women make up 60 per cent of Costa's customers, according to Bentley, which he says is what you might expect in a shopping centre.

Bentley says: "We've got a number of store formats to unlock the shopping centre market." He adds that the ideal for a shopping centre is a corner site covering about 1,400 sq ft and that this is what has been installed in the majority of malls in which Costa has been active to date.

But over the last year, a smaller mini-format has also been introduced with a 500 sq ft footprint, in Edinburgh's Gyle centre - giving room for flexibility. There is also what he refers to as a "Mall Café" where a Costa coffee shop is located in the middle of a shopping centre, as is the case at the White Rose centre.

Finally, an additional bonus for shopping centre owners - the effect a branch of Costa has upon a shopping centre. Bentley comments: "If you think of a relatively low ticket price, say for a coffee and a muffin, we bring in at least 3,000 extra people into a shopping centre a week. That's a lot of people. We're driving footfall."

When it comes to size, Bentley believes there is still a long way to go and that there is room for somewhere between 600 and 700 UK outlets. He comments: "There are malls coming out of the ground all the time and we would love to be in those as well." A good bet then if what a centre requires is a focal point where the weary can rest their feet and feel better about life. This is an upscale proposition that would slip into the new-generation of design-conscious malls as easily as its products slide down the throats of shoppers yearning for the piazzas and café-chic of down-town Milan. Check it out, before the opposition does.

Statistics

Costa

Established: 1971

Founders: Sergio and Bruno Costa

Managing director: Mark Phillips

Number of outlets: 430 in the UK, 100 overseas

In-mall outlets: "around 60"

Average mall store size: 1,400 sq ft

Acquired by Whibread: 1995

Head Office: Whitbread House, Park Street West, Luton, LU1 3BG

Website: http://www.costa.co.uk

Printer friendly version

Email this article to a friend