Research has shown Americans drink between two to three coffee cups a day and the United States is the 25th on the list of countries that drink the most coffee per capita.
More specifically, Americans’ consumption of espresso-based drinks has gone up by 50% since 2015. These drinks are especially popular in the 25 to 39-year-old population, per the National Coffee Association USA (NCA).
But what exactly is espresso?
Espresso (pronounced ess-PRESS-oh) is a concentrated form of coffee, most often served in “shots.”
Produced by a specialized machine that forces water through any kind of coffee beans, espresso is commonly used as a base ingredient for a number of coffee drinks, dessert drinks, and cocktails such as the following:
- Affogato: Vanilla gelato served in an ice cold glass or dish with espresso encasing the gelato.
- Caffé Americano: A shot of espresso combined with hot water.
- Caffé Latte: A double shot of espresso topped with steamed milk.
- Cappuccino: A single shot of espresso topped with steamed and frothed milk.
- Espresso Macchiato (Caffé Macchiatos): A single or double espresso topped with a dollop of heated, foamed milk.
- Flat White: A shot of espresso and two shots of steamed milk.
- Red-eye: Filtered coffee combined with one shot of espresso.
- Triple Espresso Martini: Triple Shot Espresso Vodka, coconut, and amaretto (sometimes with a chocolate rim).
Per coffee connoisseurs, the signature of espresso is a tan-to-brown colored foam on the top of the liquid, which forms after the espresso is made. The foam is the result of air bubbles combining with the soluble oils of the ground coffee. The crema contributes to the richer flavor and common lingering aftertaste.
Espresso has a reputation of being more caffeine laden than regular coffee. However, according to The Spruce Eats, “Since the beverage tends to be served in smaller servings than coffee, it can sometimes end up having less caffeine than standard, brewed coffee. Double and triple shot drinks and mixed drinks like red-eyes can up the caffeine level significantly.”
Coffee Drinkers’ Increasing Taste for Gourmet
Many coffee franchises, including espresso franchises, have taken on a gourmet posture over the years.
In fact, as of a few years ago, nearly 60% of coffee served in the United States is now termed as gourmet, or brewed from premium beans. The growing sophistication of coffee drinkers has encouraged coffee franchises to branch out in terms of their coffee bean sourcing.
For instance, PJ's Coffee “utilizes only the top 1% of Arabica beans, sourcing 14 origin coffees from Sumatra to Ethiopia, from Colombia to Papua New Guinea. This gourmet coffee is small batch roasted in quantities of 300lbs or less by Chief Roastmaster Felton Jones, who alone has over 25 years of experience with PJ's Coffee.”
Sustainability Concerns
A more sophisticated customer base has also forced espresso franchises to step up their game on the sustainability front. Per the NCA, more than half of coffee drinkers (53%) want to buy coffee that is certified good for the environment and good for coffee farmers and communities.
The pursuit of sustainability is leading coffee franchises to not only adopt better business practices, but explore different technologies to verify the provenance of their ingredients.
For example, striving for high levels of sustainability is prompting Café Barbera to embrace the possibilities offered to it by blockchain. The franchise, the oldest Italian roasting company, is among the first to experiment with the technology in what it hopes is a completely decentralized way to view its entire supply chain.
The desire of blockchain companies is that the technology contributes to supply chain visibility by recording each step along an ingredient’s journey from the first producer all the way through the time it gets to the end user on the blockchain, providing a record that can be viewed by customers through a mobile app or online.
Ideally, customers can know everything, absolutely everything about what they are drinking or eating: from the origin details of the producer to details on processing, storage, shipping, and the expiration dates of the all parts of the product.
“Thanks to the implementation of a decentralized blockchain protocol capable of validating our precious supply chain and demonstrating to our consumers the long journey of coffee, from the plantation to the cup, we have emphasized an aspect that is fundamental for us: to make known to all the positive impact that a shared policy between all the players in the supply chain can have on society and the environment,” says Elio Barbera, Managing Director of Café Barbera.
Initial Investment and Opening Costs for Espresso Franchises
The amount necessary to open an espresso franchise varies depending on the unique business system and execution requirements.
Like any other coffee franchise, the opening costs for an espresso franchise owner can depend on many factors, including but not limited to: the franchise fee, land and building costs, training expenses (such as travel and living expenses, not the actual training courses), grand opening advertising and marketing costs, and more.
One of the most important variables in how much it costs to open an espresso franchise is the type of franchise being opened and how big it is. The two types of food franchise most commonly offered are traditional and non-traditional. Traditional franchises are usually the biggest option. They are typically standalone buildings where the service of the franchise is the only business offering. Non-traditional franchises are smaller with little or shared sit down space. Non-traditional food franchises are typically located within another building like malls, airports, or gas stations.
It's become a trend recently for coffee franchises to somewhat blend the styles, however. New franchises are popping up that are a standalone building, much like a traditional style food franchise, but these newer builds are commonly decreasing their space for sit-down consumption. Many are opting for a second drive-through and/or a walk-up window for quick service.
Our franchise profiles will present you with a basic range for the initial investment required to open a gourmet food franchise. But when it comes to finding out the details of an initial investment, the franchise disclosure document (FDD) is the best place to look. Franchisors offer itemized estimates in their FDD based upon their experience establishing, and in some cases operating, units.
Franchisors offer estimates in their FDD based upon their experience establishing, and in some cases operating, units. However, prospective franchisees should keep in mind these estimates are just that—an estimate. Prospective franchisees should review the figures presented with a business advisor, taking into consideration their unique circumstances, before making the decision to enter into a franchise agreement.
Ongoing Costs for Espresso Franchises
Throughout the length of the agreement there are costs for being a part of the franchisor’s business system. These costs include items such as royalty fees, charges for technical support, and continued advertising/marketing costs.
The most common is the royalty fee. Royalty fees are assessed for the continued use of the franchisor’s trademarks and patented processes, along with certain types of operational support. In addition to regularly assessed fees, other fees are charged on an “as needed” basis such as audit fees, or costs for additional, non-mandatory, training.
In addition, it’s important to note that while many initial and ongoing costs are detailed in the FDD, there are some costs inherent to business ownership, like employee wages or utility costs, that aren’t.
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