Coffee#1 Marks 25 Years, Adapts to UK's Crowded Coffee Market
Coffee#1 marked 25 years with more than 130 stores, as Bruce Newman said the chain has to keep evolving for drinkers shaped by specialty coffee.
Coffee#1 reached its 25-year milestone with a market that looks nothing like the one it entered on 30 April 2001. What began in Cardiff as a single coffee shop has grown to more than 130 stores across Wales, Southern England and the Midlands, and the brand still frames itself around giving customers “a more complete experience” while staying “locally loved.”
That language matters now more than ever. Twenty-five years ago, the high street was still full of generic espresso counters and uniform café chains. Today, Coffee#1 is selling into a far sharper market, where provenance, preparation and the feel of the café matter as much as speed. In his Q&A, managing director Bruce Newman said the sector is much larger than it was in the early years and that more niche operators have moved into the space, forcing Coffee#1 to keep evolving without losing sight of its core identity. That core, he said, is community, premium coffee and outstanding service.
The company’s own values show how it wants to be judged. Coffee#1 says it serves great coffee made by talented baristas in a relaxed, welcoming environment where customers’ time is their own. That positioning has been tested in the menu as much as the fit-out. Iced drinks, once a seasonal add-on for many chains, are now central to the business. Newman said innovation around iced beverages is no longer a fad but a normal part of serving customers year-round. Coffee#1 said like-for-like iced coffee sales grew nearly 400% in the quarter to 31 May 2023, then rose another 39% on a same-store-sales basis in the quarter ending 31 August 2023.
Digital trading has become another major lever. Coffee#1 reported more than 600,000 app transactions in one quarter and said nearly 30% of all transactions were being made through the app at that point. By October 2023, the chain said more than 28% of all transactions ran through the app, underlining how loyalty and payment have become part of the café routine. The chain remains predominantly a drink-in brand, but delivery and Click and Collect have been added to fit changing working patterns and buying habits.
Ownership has also shifted as the business has expanded. The Nero Group took a 67% stake in Coffee#1 in 2019 and bought the remaining 33% from S.A. Brain in February 2022. Coffee#1 later said revenues had reached 120% of 2019 levels in January 2023, sales stood at 117% of pre-pandemic levels in the three months to 31 May 2023, and three new stores had taken the estate to 115 outlets by August 2023. Alongside that growth, the chain has kept its local charity links, including work with Samaritans, Mencap, homelessness charities and other community groups.
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