US reality show Shark Tank investor Barbara Corcoran once said: “Finding opportunity is a matter of believing it’s there.” We have heard for years that the office breakroom houses plenty of potential for additional sales and growth, but many independent dealers have stopped focusing on this category after winning the coffee and tea business.
This lack of additional discovery is a missed opportunity and all dealers need to understand that there is more and that it is in their best interest to uncover these prospects.
Start with coffee
The average employee drinks 1.5 cups of coffee per day, so starting with the coffee business is the easy choice when deciding how to enter the breakroom category. Beware, however, that dealers will likely have to be competitive with pricing, as coffee is the second largest commodity in the world behind oil. So while the coffee and tea business is the perfect entry into the breakroom category, dealers will make little margin on these sales, and it is imperative that they capitalise on other opportunities.
If employers offer coffee and tea, for example, they will also need essentials like cups, lids, creamer, sugar, stir sticks and more. Supplying these sub-categories improves margin and further establishes the dealer as a partner with the company.
As a general guide, start the conversation with the customer’s office products buyer, as this person probably does the purchasing for the breakroom as well. And even if customers do not offer any beverages or other breakroom products yet, dealers have a chance to become consultants and educate them on the advantages of carrying these products. Improved productivity is a good example as employees are less likely to leave the office on a coffee run.
Capitalise on trends
There are two emerging trends that dealers can capitalise on in an effort to expand within this category: personalisation and snacking. Over the past decade, food and beverage establishments have done this very successfully, creating a core menu of options, but being flexible and able to offer a personal experience.
This customisation has become the norm and recently migrated into the office. Specifically, employees expect to not only have the basics like coffee, creamer and sugar, but to also have options within those basics. For example, in addition to original flavour coffee creamer, employers will also need to carry other flavours such as French vanilla and hazelnut to cater to their increasingly demanding employees. All dealers should see this as an opportunity to expand and grow sales.
The second trend surrounds snacking. Over 40% of consumers eat three or more snacks a day and statistics have shown that snacking has increased across every part of the day. Companies such as Google and Facebook have changed employee expectations by providing plenty of food options at work, which opens the conversation for dealers.
Do their customers offer snacks? If so, what kind of snacks? Do they offer breakfast bars or microwavable soups as meal substitutes? Do they have meetings where someone usually picks up candy or pretzels? All these are opportunities to expand breakroom sales.
After dealers have established themselves as the partner of choice for all breakroom items, they need to look for occasions to upgrade products and increase profitability. Wellness and sustainability are two developing trends they can use to do that. Research has shown that people are looking for healthy snacking alternatives at work, so trade in the candy for whole nut mixes. Add additional sweetener options like stevia or turbinado sugar that are more natural.
For customers that want to become more eco-friendly, suggest they trade out their foam cups and plates to recycled alternatives or sugar cane compostable options. These items tend to have a higher ring and therefore increase margin for the dealer.
Dealers need to stay close to their customers and really understand their needs, so when the time comes and they need a new toaster or want to renovate their entire breakroom, they are the first ones that spring to mind.
So ask the right questions and become a consultant on all the latest trends and products. And remember, if you believe there are additional opportunities, you will find them.