When coffee isn’t ‘just coffee’: Building the business case for office beverages

Most coffee and refreshment services operators will remember COVID-19 as a time when the bottom fell out as offices closed by the tens of thousands. But in retrospect, as the economy has recovered from that setback, the reality has become more nuanced.

More employees are working remotely, but for those still coming to the office, the coffee service program has taken on a new importance. So says Michelle Scott, national account executive, Royal Cup Coffee & Tea, a Birmingham, Alabama-based importer, roaster and distributor of coffees and teas.

Beverage service reinvents itself

"Today's office beverage programs have had to reinvent themselves because of COVID," Scott said in a recent National Coffee Association webinar. "For example, younger coffee consumers' entry into the coffee world is cold coffee, and not hot…Ice coffee, cold brew and nitro — they all make up a significant portion of the workforce."

This is why the majority of office coffee service operators are now offering cold brew options.

Young consumers are also more apt to purchase coffee with a "cause" claim like organic or Rainforest Alliance, Scott said. As a result, the next evolution that addresses functionality and taste preferences is a beverage program more than just beverage in the cup to alleviate thirst.

The 'office program'

"It's an office program that offers employees the beverages they want, both hot and cold that are customizable to their taste preferences that reflect corporate sustainability and environmental concern," Scott said.

Employees may only come to the office three days a week, but the employer is willing to give them more when they come, including higher end coffee equipment and free snacks.

"We're seeing signs of recovery, but it will not happen overnight," Scott said. More workers are returning to the office, but many are still working remotely.

Despite the growth in remote work, access to coffee at work has increased since the start of the pandemic, Scott said, citing numbers from to the Fall 2022 NCA National Coffee Data Trends report.

In July, 2022, 36% of Americans said they have access to a coffee station at work, up from 30% the prior year. More and more offices are going beyond drip and single-serve machines to bean-to-cup machines, water solutions and cold brew machines.

Consumption expands to more choices

Beverage consumption has also expanded to more types of beverages, even though coffee remains the number one beverage of choice.

Over two thirds of Americans 25 years old and over consumed at least one cup of coffee in the past day, according to the NCA study.

Past-day penetration is now 66% coffee, 42% soft drinks, 46% tap water, 60% bottled water, 47% tea and 21% juice, according to NCA. The soft drinks marks a big gain over the prior year at 38%, while tap drink is a big increase over 42% and bottled water is a gain over the prior year's 54%.

"From seeing these numbers, a well rounded office coffee service program needs to present a variety of beverages to keep all employees happy," Scott said.

The workplace is the third highest location for past-day coffee consumption after at-home and the coffee shop. In addition, 85% of employees feel coffee breaks at work are important. Coffee at work makes employees feel valued, increases their productivity, offers positive social interaction and manages stress.

"When employees have good relationships with those they work with, they're more productive, it increases morale, and may help employees feel included and have a sense of belonging in their workplace," Scott said.

Corporate social responsibility gains importance

"Your corporate social responsibility initiatives say a lot about your company, but it can be difficult to communicate those to employees in a meaningful way," she said. "The coffee, tea and beverage initiatives are initiatives in action. This can include organic, direct or fair trade or Rainforest Alliance coffees communicated with signage at the coffee station."

Scott offered the following steps for setting up a successful workplace beverage program to present to prospective locations:

• The budget is a first step. Determine the number of employees that will most likely participate, visitors and frequency.
• Determine the types of beverages and snacks.
• Determine the corporate initiatives you will align with the program.
• Locate the coffee station and product storage area.
• Select customization options like flavored creamers and syrups.
• Select equipment that addresses volume needs, power requirements, operations and maintenance.
• Identify internal or external resources to run the program.

For such a process to succeed, guidance by a "coffee service expert," i.e., a coffee service operator, is critical, in Scott's view.

The coffee service expert will also help measure success. What is the participation percentage? The percentage of budget used? The turn of inventory?

"Each program is customizable, so as your company grows and changes, the types of beverages and snacks that are offered can grow along with you, and consulting that OCS expert is the best way of implementation and maintaining a robust program that employees can enjoy for years and years to come," Scott said, speaking from the perspective of a location manager.

Post COVID changes

Asked what trends she's most surprised by post COVID, Scott said the variety of snacks being offered. This is because employers are willing to expand the budget more.

Asked what new beverages employees expecting, Scott said water. Not just a water cooler, but also flavored and sparkling water, either via equipment or as a canned beverage.

Successful OCS programs often include a variety of different types of machines, providing the location warrants it. It could be a combination of bean-to-cup and espresso machines, a sparkling water machine and organic teas.

"The variety is where we have seen success," Scott said.

Locations with more than 100 employees merit a bean-to-cup machine. It's costly, but if it's a new program, it will be a "wow" feature.

Single-serve machines are better for smaller offices. A lot of them now have touchscreens which also bring a "wow" factor.

Location surveys are important, Scott said. You need feedback to know what is and is not working well.

"The food and beverage amenity program in some offices is more important to some people than let's say a 401K match," Scott said. "We're especially seeing that in (the) younger generation."