September_2021 - 12

CHART 5A: % OCS sales
by supplier type
SUPPLIER TYPE
Private label
Local coffee brands
(known to customers)
National brand -
value coffee
National brand -
specialty coffee
Espresso coffee
2020/21
23.5%
25.5
26.8
15.0
9.2
CHART 5B: % OCS sales
by product category
PRODUCT CATEGORY 2020/21
Frac pack
Whole bean coffee
K-cups
Single cup (non K-cup)
41.5%
30.5
13.1
14.9
CHART 5C: Top-selling OCS
products for past 12 months,
by volume
TOP PRODUCT
Local coffee brands
Private label
Value frac packs
Specialty drinks
Whole bean
National brand coffees
K-Cups
Single-cup
Tea
Pantry or direct
delivery service
(food/snacks/beverages
delivered to locations)
Water filtration service
(point-of-use/POU)
year, with a majority reporting a loss
between 50% and more than 80%.
Despite the dramatic downturn
in sales, providing high-quality coffee
and high-tech brewing options continued
to trend in 2020, and the deployment
of app-based touchless solutions
became more common. The placement
of bean-to-cup brewing systems,
some featuring contactless interfaces,
was the only equipment type to witness
marginal growth last year.
23.8%
26.7%
2020/21
20.80%
12.50
4.20
4.20
12.50
29.10
4.20
8.30
0.00
0.00
FROST AND FREIGHT
Green coffee prices remained relatively
stable through most of 2020, compared
with the previous two years. In the
first half of 2021, however, bean prices
have significantly jumped each month
due to frost in Brazil, freight and
supply chain disruptions, and labor
issues in some major coffee-producing
countries, including Columbia and
Vietnam. Data from the International
Coffee Organization show green coffee
prices up 30% in August 2021, compared
with August 2020 (see chart 3A).
Most operators said they are rais19.9%
8.3%
2019/20
2020/21
19.9%
24.6%
4.20
CHART
5D: OCS product
category, % of sales
PRODUCT CATEGORY 2020/21
Coffee
Non-coffee hot beverages
Soft drinks
Bottled water (5 gallon)
Creamers/sweeteners
Cups/plates/paper
products
Tea
Pantry service/micro
kitchen (paid by employer
offered to employees)
Water filtration service
(non bottled)
Ice machines
51.3%
7.5
4.6
8.5
4.9
5.9
4.9
3.1
7.7
1.6
ing prices or absorbing costs (mostly
a combination of both) to offset these
historically high commodity prices
(see chart 3B). A small percentage of
operators chose to divest their OCS
businesses because of rising costs and
other challenges posed by COVID's
damaging effects on business.
Almost 70% of OCS companies
had to reduce their staff counts last
year. Additionally, most operators
represented in this survey applied and
were approved for the Small Business
Administration's Paycheck Production
Program (PPP) loan either in 2020 or
early 2021.
In 2020, average revenue for a
6-fl.oz. cup produced by " frac packs "
in a plumbed-in brewer was 11.4¢,
compared with 10.6¢ the previous
year. Revenue per single-cup capsule
and bean-to-cup offering was 49.4¢
and 44.8¢, respectively, increasing
12 Automatic Merchandiser * September 2021
CHART 6: Plumbed-in, automatic
and thermal as % of total
● Pourover glass pot
● Automatic thermal
● Pourover thermal
● Automatic glass pot
● Single-cup
10.4%
26.3%
33.2%
5.5%
compared with
prices in previous
years (see charts 4A and 4B for
a five-year review). Frac packs and
whole-bean varieties where the dominant
coffee products sold in the OCS
channel in 2020.
In OCS accounts that were open
in 2020, nationally branded coffee
was the top seller (27%), followed by
local brands familiar to clients (26%)
and private-label products (24%).
The delivery format for these brands,
in order of popularity: fraction pack
(41.5%), whole bean (30.5%), singlecup,
excluding K-Cups (14.9%) and
K-Cups (13.1%). The sale of lowercost
private-label brands is expected
rise in the current coffee market.
Regarding equipment, automatic
pot/thermal brewers and single-cup
systems continued to supplant traditional
pot/thermal brewers last year
(see chart 6).
Also notable last year, deliveries
of janitorial supplies by OCS operators
more than tripled, compared with
2019. Along the same lines, " bottleless "
water coolers enjoyed growth in
September_2021

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