Consumers’ insatiable craving for caffeine has fueled a boom in the number of coffee shops across the U.S., The Wall Street Journal reports.
Over the past five years, the number of cafes, including chains like Starbucks, has jumped 16% to 33,000. But the boom is hurting some business, as consumers are visiting traditional coffee shops less often in favor of cheaper specialty brews offered at fast food chains, grocery stores and gas stations.
Traffic growth to large coffee chains like Starbucks is slowing, while business at small coffee chains and independent shops is also on the decline, according to market research company NPD Group.
The troubles facing the coffee business are similar to those plaguing the broader food-retail and restaurant industries, which have an oversupply of retail space competing against a proliferation of new food options.
“I just don’t see room for more coffee shops,” says NPD analyst Bonnie Riggs.
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