Pre-COVID-19, most operators reported that office coffee service (OCS) accounts were strong. Our annual State of the Office Coffee Service Industry report, released last month, revealed that the OCS segment had its best year yet, hitting revenues of $5.97 billion, a 4.8% increase over the previous year. But as COVID-19 drove employers to allow their employees to work from home, OCS accounts were hit hard.
According to the Stanford Institute for Economic Policy Research, 42% of the American labor force is currently working from home full-time, a trend that is likely to continue until a COVID-19 vaccine is widely available. Instead of waiting for workplaces to fully open and the workforce to return — or trying to predict the future on when and how this will happen — operators should take a more proactive approach. Here are three ideas for OCS operators to maintain and grow accounts throughout the pandemic.
1. Clean up your current accounts
When offering a premium service such as OCS, many operators have minimums in order to turn a profit. If you have accounts that haven’t been performing well — or were among the first to cancel their coffee service — it may be time to cut ties.
“[COVID-19] allowed us to clean up our business,” explained Andrew Didier, CEO of Agora Refreshments, located in the greater Seattle area. “A lot of the cancellations we received were from clients that weren’t performing significantly well, so those were the first to go. When we’re providing the level of service that we’re providing, our profit has to be at the right spot or it just doesn’t make sense for us.”
Didier said that his company was down more than 90% at the end of March 2020. He added that they gradually increased to about 30% of their usual business over the summer, and now they’re back to about half of their normal revenue. Agora has been able to acquire new business to replace accounts lost during to the pandemic.
“We’ve been able to acquire new business to replace that business. The overarching theme for us is to be a resource,” Didier said. “Come in as more of a consultant on how you can be a resource to bring people back to work — I think that’s been much more effective for us.”
Didier said email marketing has been an effective way to inform current and prospective customers about new touchless equipment offerings and the variety of break room solutions his company offers to fit a client’s specific needs.
“People are still out there looking,” Didier said. “We found them through email marketing campaigns through our CRM — we’ve been doing a lot of email blasts. We have a newsletter we send out monthly with updates on cool products we’re offering and what types of nourishment we can provide in the office so employees don’t have to leave work and possibly endanger their coworkers by being out in public.”
Need another reason to carefully examine your OCS account list? Operators who had healthy account diversification going into the pandemic experienced smaller losses. Since they weren’t dependent upon one industry that was massively affected by COVID-19, they could manage the revenue loss from non-essential businesses that were closed during lockdowns.
As you’re looking to grow future OCS business, be sure to grow strategically throughout different industries so you’re better positioned to endure future crises. This keeps you from being too reliant on a particular industry or business.
“Diversification of our customer base saved us,” Didier said.
2. Explore how you can modify service offerings without reinventing the wheel
Many operators started offering personal protective equipment (PPE) and cleaning/sanitization supplies. This gives your accounts one less place to get what they need to keep employees — and the break room area — safe.
“We started a bioprotection spray service,” Didier explained, noting his company uses PLNTSOP's BIOPROTECT™ RTU. “Basically, you spray it on and it adheres to surfaces for up to 90 days and kills viruses and bacteria. We’re trying to make the break room a safe place so people can use our equipment.”
Didier also modified the snack and pantry service Agora offers to accommodate employees working from home. Through this service, employers pay for Agora to curate a break room snack box that is delivered to employees at home.
“We’ve seen a big pickup in our grab-and-go snacks options,” he said. “We still do have minimums and we need to bring in revenue, so we’ve offered the remote break room. We’ve noticed that for parents who are also taking care of kids or having to homeschool, grab-and-go snacks are helpful to nourish kids as well as yourself throughout the day when you’re working from home. We’ve had a good response — I’d say our snack revenue has doubled.”
3. Make good use of the many touchless options that are now available
The biggest trend in convenience services in 2020 is clearly touchless equipment. While savvy operators were previously investigating and investing in more connected solutions to streamline service and overall operations, this paved the way for easy upgrades to existing equipment.
Didier explained that Agora had been integrating equipment with cellular connections prior to the pandemic so it could serve clients quickly and efficiently.
“Touchless wasn’t something that we were really thinking of — it was more about the level of service opportunities and being able to track how people were using the equipment or adding marketing materials,” Didier said, noting that Agora started enabling touchless services as soon as suppliers and equipment manufacturers offered them. “Hats off to the suppliers for how quickly they were able to move in getting touchless options.”
Among the many touchless solutions available is a new partnership between 365 Retail Markets and Bunn-O-Matic Corporation: VirtualTOUCH by BUNN. Powered by the 365Beacon and BUNNlink, a cloud-based solution, operators can easily integrate a touchless solution that works with all 365 micro market points of sale and the 365Pay app. Consumers benefit by having access to a full beverage menu — displayed through the user’s mobile phone — and access to their Global Market Account for payment.
Didier says that he believes this is an important window for operators to communicate with clients and identify new accounts. .
“In the next six months, people are going to return to work. I think a lot of companies are realizing that working from home is not as productive as they thought it would be,” he said. “I don’t see people ever fully returning to work with the staff they had previously, but I could see a four-day work week/one-day work-from-home situation. At this point, we’re trying to find opportunities where we can and be a resource to potential and current clients so they don’t stray. This is the best time to communicate with your clients so they don’t feel alone.”