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The demand for premium coffee has led to a rapid increase in the number of coffee shops in the UK, with over 5,000 branded outlets open in June 2012. Major companies’ influence on the world coffee market has contributed to the weak bargaining position of the small-scale producers, many of whom face debt and poverty. However, supporting ethical schemes such as fair trade can reconcile our enjoyment of coffee shops with the needs of the producers.

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UK coffee shop market

The retail coffee market was worth over £5.8 billion in 2012. Branded cafés account for an estimated £2.3 billion of this business, and the three main players (Starbucks, Caffè Nero and Costa Coffee) make up over half of the branded market – and that market is still growing. Predictions that demand for premium coffee would only be a short-lived trend in Britain have been discredited, as the country embraces a European-style café culture. An annual growth rate of at least 6 per cent is expected in this sector for the foreseeable future.

The growth of chain cafés throughout Europe and North America has made a small number of companies very influential in the coffee market as a whole. Most notably, Starbucks now buys 2.2 per cent of the world’s coffee. Large companies are able to dictate terms to smaller producers and force down the price of coffee, pushing many small producers below the poverty line. This is a serious problem that all coffee drinkers should be aware of.

Fair trade

The fair trade scheme is the most effective and well-known way to help the 20 million people involved in the production of coffee. Fair trade protects small producers from fluctuating prices and acquisitive middlemen by guaranteeing a minimum price for their coffee and ensuring that farmers are paid regularly. The scheme also charges a premium of 15 US cents per pound of coffee to fund future development. The growing popularity of coffee shops means that cafés can make a significant difference by embracing fair trade. For example, Café Revive’s decision to buy only fair trade coffee in 2004 led to a 14 per cent increase in the UK’s consumption of ethically sourced coffee.

Developments in the coffee shop sector and the emergence of more ethical cafés show what can be achieved by pressuring companies to undertake more ethical forms of practice. In 2004, AMT announced that the reason for their change to fair trade was ‘due to your demand’. As more and more people seek out fair trade coffee, it its likely that other cafés will also consider ethical purchasing as a means of improving their profits.

Café wars

The growth of branded coffee shops has contributed to the growing monotony of Britain’s high streets. In spite of now serving mainly fair trade coffee, Starbucks in particular has been criticised for its aggressive expansion. The resources of the company enable it to sacrifice immediate profits in order to ensure that the brand is visible in prime locations and town centres. Starbucks has also been accused of deliberately locating branches near other established cafés in order to force competitors out of the market. Readers who are concerned about these tactics, and those who value diversity on the high street, can easily vote with their wallet by supporting the smaller coffee shops, which (at the moment) are still more common than their branded rivals.

Tea drinkers may want to support their local tea rooms rather than buying from branded coffee shops.

Ethical Comparison – Café Rankings Detailed Table

Buy our detailed Ethical Research Reports. See the findings behind companies’ ethical ratings, as featured in The Good Shopping Guide. Several different product sectors available covering hundreds of consumer brands.

We have created ethical comparison rankings for the following brands, based on the activities of the company group (see above tables): Café Revive, AMT, Café Nero, Costa Coffee, Coffee Republic, Puccinos, Pret a Manger, Starbucks

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