[jaboober]

This news is a bit old now, but Vancouver coffee chain Caffe Artigiano's attempt to break into Toronto didn't last long. I tried them a few times but the location on Yonge was awkward (I walked past the entrance by mistake several times even when I knew it was there) and the coffee honestly didn't seem that exceptional.

http://www.blogto.com/eat_drink/2016/02/popular_vancouver_coffee_chain_retreats_from_toronto

So that's what happened to that place. I always thought it felt like a chain. You could tell by the menu and how orderly everything was carried out. Independents aren't so laser focussed on having a sterile atmosphere and perfect displays.

 

[the lemur]

This is kind of the opposite phenomenon, but Shell Canada stations will start selling Costa Coffee, the UK's largest coffee retailer and the global #2 after Starbucks ... which is weird, considering some Shell gas stations have Tim Hortons, don't they?

 

[someMidTowner]

some Shell gas stations have Tim Hortons, don't they?

I thought that was only Esso stations, but I could be wrong

 

[Skeezix]

Weird way for Costa to break into the Canadian market - at gas stations.

 

[GeneralGrievance]

There are already Costa Coffee stands in the Shell Stations at Yonge and York Mills, and at Marlee and Roselawn (those are the ones I've passed by).
I haven't had it yet, but I'm not a fan of the chain in other countries (tried it in the U.K. and in Serbia)

 

[the lemur]

I thought that was only Esso stations, but I could be wrong

I thought so too, but oddly enough, Shell has a grand total of nine stations across Canada with Tim Hortons attached.

It's a little like how Tim Hortons expanded into Ireland, at gas stations only.

 

[Skeezix]

It makes sense for Tim Hortons, given its image and appeal (and many of us are old enough to remember when Timmies wasn't as omnipresent as it is today and for many people was mainly a road trip coffee), to be in gas stations. In any event, Canadians already know the brand (well).

My impression of Costa Coffee from the UK that it competes more on Starbucks-type turf than Tim Hortons-type turf (maybe I am wrong). And while there are undoubtedly Starbucks in gas stations on this planet, I would guess those are in markets where Starbucks is already deep on the ground and the gas station customers are already familiar with Starbucks outside of a gas station context (they are not associating Starbucks as mainly gas station coffee in their mind).

Seems odd for Costa to be introducing itself to Canadians in gas stations. That might be a hard association for them to break. I don't know - maybe it's an inexpensive and effective way to break into Canada, or maybe the deal was lucrative. It makes sense for Shell - if one likes Costa Coffee, one needs to go to Shell to get it.

 

[PinkLucy]

My impression of Costa when I was in England recently was more of a Tim's vibe ... but that's perhaps there were a lot of rest stops along the motorways with Costas.

 

[Skeezix]

Maybe Costas like their gas stations and rest stops...

 

[Admiral Beez]

Timmies is Brazilian now, so I'll take UK-coffee at Shell just as well.

 

[TOareaFan]

Weird way for Costa to break into the Canadian market - at gas stations.

Actually not that weird.

In the suburbs the combo gas station/coffee shop is (by observation) causing a real shift in how things are done. People getting their coffee in the morning is actually shifting traffic patterns at gas stations to the point the gas station owners are pushing much higher margins on their gas in the a.m. peak than they do at any other time of the day....people are, clearly, shifting their gas filling preference to the a.m. (regardless of price) on the basis they are/were going to stop there anywhere for their morning java so they might as well fill their cars at the same time. The Esso station near me has same day swings in pricing from 7 - 10 cents a litre between the a.m. morning peak price and the evening price and the lineup at the Tim's is unbelieveable.....I shifted my morning fill up to the Mac's station around the corner where they move Seattle's best coffee and it is a bit quicker (unless you get stuck behind someone turning a convenience store into a lottery casino)....they also move their prices between the morning peak and the evening but the gap there is somewhere between 5 and 7 cents a litre.

I would imagine that the Shell deal with Costa is a move to attract the sort of morning traffic that the Esso stations have with Tim's.........I would also bet it was Shell that went looking for a premium coffee retailer rather than the other way around.

 

[Skeezix]

As usual, the lifestyle choices of suburbanites simply baffle me.

Still, for a chain that has no other brand presence in Canada and is largely unknown to Canadians (in contrast to a chain like Tim's), I would have thought it's a potential risk. Just because people in the burbs like to get coffee and gas at the same time in the morning doesn't mean Costa won't get stuck with a gas station coffee label which might make it harder for them to build the kind of retail network they have in the U.K. (i.e. a network that extends beyond service stations). Maybe that label is not such a bad thing, and maybe Costa had no plans for Canada so being the coffee of choice for Esso Shell customers here is just gravy to them.

 

[TOareaFan]

As usual, the lifestyle choices of suburbanites simply baffle me.

Still, for a chain that has no other brand presence in Canada and is largely unknown to Canadians (in contrast to a chain like Tim's), I would have thought it's a potential risk. Just because people in the burbs like to get coffee and gas at the same time in the morning doesn't mean Costa won't get stuck with a gas station coffee label which might make it harder for them to build the kind of retail network they have in the U.K. (i.e. a network that extends beyond service stations). Maybe that label is not such a bad thing, and maybe Costa had no plans for Canada so being the coffee of choice for Esso Shell customers here is just gravy to them.

Coffee is a tough market to crack for a latecomer to a relatively mature market player.....sure, if you want to open a boutique coffee shop and, even, grow it into a "mini chain" that is one thing....but for a big chain (like Costa) to come to the Canadian market and get then number of locations that they would need/want to justify a country expansion that is very tough. There is a dominant player with a lot of the good locations already tied up....the global behemoth that is Starbucks is also already here with hundreds of locations....there are secondary domestic chains like Country Style and Second Cup...and a whole lot of those local/boutique places. My bet is they had/have no plans to open stand alone locations and when the Shell opportunity presented itself ( it seems they already have a relationship with Shell in other markets) it was a way to sell more coffee but in a market that they are not in.

Here is what you will see in ~150 shell locations (with options for more).

 

[Johnny Au]

It would be interesting if David's Tea were to get into the coffee business.

It is very interesting that many coffee shops sell a large variety of tea as well.

There is a very good reason why Starbucks bought Teavana.

 

[Johnny Au]

I have an idea: it would be interesting if there were a craft coffee and a craft tea industry, just like the craft (beer) brewing industry. However, the coffee beans and the tea leaves would be sourced from small, independent growers.

Craft brewers could experiment with craft kombucha (fermented slightly alcoholic tea) as well.