Source; http://www.theherald.co.uk/news/other/display.var.2461385.0.coffee_chain_feels_pain_of_caffeine_cutbacks.php
By Julia Horton, The Herald
CAFE chain Coffee Republic yesterday blamed the "toughening" economic climate for a downfall in sales as credit crisis-hit customers cut back on their daily lattes.
Like-for-like sales from April to September were down 0.2%, despite an initial 2.5% rise between April and June, signalling a significant downturn in the past three months.
The company said the fall in sales "reflected a toughening climate".
However, it also claimed that it had begun to reverse the trend with more aggressive sales and marketing activity. Newly-opened bars have been helping to boost the chain's fortunes, including an outlet at St Andrew Square in Edinburgh opposite the historic headquarters of the troubled Royal Bank of Scotland.
There was no obvious sign of people cutting back on spending there yesterday as a dozen or so customers enjoyed a drink.
Cafe director Paul Anderson said: "Our like-for-like sales are up every week. Obviously it's a new shop. I think it depends a lot on location but we're doing fine. Our busiest hour is still 8am to 9am when people buy coffees on their way to work."
Staff at RBS, where the cafe holds its business accounts, also seemed to show no sign of cutting back on their hot drinks with an order of 24 coffees placed with Mr Anderson yesterday.
However, one customer said that she tended not to buy coffee from outlets any more because of the economic downturn.
Kelly Drew, a 32-year-old Edinburgh marketing executive enjoying a coffee with her mother who was visiting for the weekend, said: "Personally it's a rarity for me for that reason. I don't really buy coffees as a rule in the morning because you can make your own and it's a lot cheaper."
Meanwhile, Coffee Republic has secured a key concession deal with cinema chain Cineworld which it expects to increase sales as customers flock to see blockbusters such as the new James Bond film, Quantum of Solace.
The chain has 195 outlets internationally, including 184 in the UK.
