Nestle begins street cafes
Despite coffee consumption out of home dropping throughout the pandemic, Nestle Thai is pursuing a fresh coffee cafe model.
Nestle opened the first Nescafe Street Cafe earlier this month in Chiang Mai as a pilot project before branching out into major cities across the country.
Nescafe Street Cafe is operated by Nestle Professional, aimed at Thai entrepreneurs who want to have their own cafes.
"The Nescafe Street Cafe allows us to cover both in-home and out-of-home consumption," said Naritta Vipulyasekha, business manager for Nescafe mixes at Nestle Thai.
"The majority of our sales come from instant coffee, which is suitable for consumption at home."
Thailand's coffee market is estimated at 60 billion baht, with 33 billion from home sales.
She said continuous growth in demand for out-of-home coffee the past several years led Nescafe to open Nescafe Hub, a fresh coffee cafe, at skytrain stations in 2018.
The company opened two new Nescafe Hubs at Ploenchit and Mo Chit a few weeks ago, bringing the total to seven stores.
"During the outbreak, our in-home coffee fared quite well with a growth rate of 10.7% year-on-year in the first eight months this year, while the out-of-home segment fell by 30-50% for the period," said Ms Naritta.
"This year is a golden year for Nescafe. With more people unemployed and staying at home, drinkers have shifted from out-of-home consumption to making their own at home."
She said with consumers more concerned about the environment, the company has vowed to change all of Nescafe's coffee packaging to be 100% recyclable by 2022, up from 50% now.
This plan is in line with Nestle's global mission of creating a waste-free zone by transforming all its packaging to be 100% recyclable or reusable by 2025, and in line with Thailand's 2018-30 plastic waste management plan.
Nestle Thai has two key strategies to maintain a sustainable business operation: introducing innovative green packaging to the market and contributing to a waste-free future by upcycling used packaging into a variety of value-added items.
"We hope our move to inspire more Thais to switch to green packaging will help create a waste-free society in the future," said Ms Naritta.