When you pass most British pubs on a Tuesday morning around half past eight, you’ll notice the same things: shutters down, chairs still piled on tables, and a handwritten sign in the window stating that meal hours begin at twelve. In the meantime, a line emerges from the Costa Coffee across the street, past a Pret, and around the corner in the direction of a third wave independent that charges £4.80 for an oat flat white and makes it appear to be well worth the money. The pub, which has enough space for forty people and has weathered bar stools and exposed beams, is vacant. When you consider it, it’s an odd kind of waste.
The bar industry in the UK isn’t exactly doing well. The British Beer and Pub Association estimates that 378 bars will close permanently in 2025 alone, or about one per day. Since 2000, more than 15,800 pubs more than one third of all those that existed at the beginning of the century have closed. Business rates, energy expenses that are still twice as high as they were before the war in Ukraine, increases in National Insurance, and the gradual decline in younger consumers’ alcohol consumption are all well known causes. It’s all not new. The discussion of what pubs might do in response is more recent and possibly more fascinating. And the topic of coffee keeps coming up in that discourse.
| Category | Details |
|---|---|
| Industry | UK Pub & Hospitality Sector |
| Market Value (2025)** | £24.1 billion (pub sector); £6.1 billion (branded coffee shops) |
| Annual Pub Closures (2025) | ~378 pubs, nearly one per day |
| UK Daily Coffee Consumption | ~98 million cups per day |
| Morning Trade Growth Rate | 13.7% year-on-year (fastest meal occasion) |
| Consumer Preference | 48% would choose their local pub over a high street chain for morning coffee if pubs opened earlier |
| Coffee Gross Margin | 70–80% (vs 50–65% for beer and spirits) |
| Key Operators | JD Wetherspoon, Admiral Taverns, Shepherd Neame, Barons Pub Company |
According to research done by Allegra Strategies on behalf of UCC Coffee, 48% of patrons would prefer their neighborhood pub over a chain on the high street if it just opened earlier in the morning. Almost 10% already think that coffee from pubs is superior to coffee from Pret, Costa, or Starbucks. That isn’t a preference for a specialty. In essence, half of the nation is stating that there is an opportunity, but it isn’t being seized.
There may be a cultural component to the reluctance. The British bar has long seen itself as an evening institution a place you visit after dinner or work, not one you happen upon before the school run. Many operators don’t appear to comprehend how quickly this understanding is changing. According to tracking data from Lumina Intelligence, late night pub visits that take place after 10 p.m. have decreased by about two percentage points annually. There has been an increase in visits between 2 and 5 p.m. and between 5 and 8 p.m. The client is relocating early in the day. Whether or not the pub is moving with them is the question.
Although its magnitude makes direct comparison challenging for independents, JD Wetherspoon offers the most illuminating case study. The business, which offers filter coffee with free refills for 99 pence and a full meal for £2.99, extended opening hours to 7am at several of its more than 900 locations. The company currently sells over 50 million coffees and teas and 24 million breakfasts annually, bringing in about £150 million from those early hours alone. The findings were hard to dispute. In the 26 weeks leading up to January 2015, food sales increased 10.1%, but bar sales only increased 1.5%. The morning trade was simply exceeding the evening one, according to Chairman Tim Martin’s direct explanation of that comparison.
This is appealing in part because of the margins. Compared to beer and spirits, which normally have a gross margin of between 50 and 65 percent, a single cup of coffee priced between £2.50 and £3.50 has a gross margin of 70 to 80 percent. In comparison to what consumers will pay for coffee, the cost of production is essentially zero, especially if the product is high quality and the environment is cozy.
The average transaction value increases toward the £7 to £8 level that SpendMapper data indicates is typical for out of home coffee and meal situations when you add a bacon roll or a slice of sourdough with eggs. Before food is taken into account, a tavern that sells 50 cups a morning at an average price of £2.50 makes £3,250 a month. With 70% gross margins, a daypart that now generates no revenue for the majority of operators can generate more than £2,000 in gross profit per month.
In order to attract midweek morning business, Marcus Pearcey, the owner of Marcus Hospitality Group in Norwich, incorporated a bakery onto the front of one of his locations. At a different site, a hatch offers coffee and cakes in addition to a membership service where patrons pay a monthly charge for unlimited coffee at several group locations.
Delivered at The Morning Advertiser Leaders conference, his reasoning was simple: “During the day, people are sipping coffee instead of purchasing booze. People have been requesting cappuccinos throughout the week instead of espresso martinis, so that’s what we will serve them.” When you listen to operators like Pearcey, you get the impression that some of them have already surpassed a psychological threshold that others haven’t yet reached a recognition that the pub’s identity must adapt to this change rather than fight it.
There isn’t exactly a lack of momentum in the UK coffee sector to pull from. After growing by 5.2% the year before, the branded coffee shop market alone is expected to be worth £6.1 billion in 2025. Despite an average price increase of 17% in just two years, weekly out of home coffee trips have increased from 13% in 2022 to 15.1% in 2025. Roughly 98 million cups of coffee are consumed daily by Britons. The market isn’t saturated; in fact, it’s still growing into the routines and habits of individuals who haven’t yet made going to coffee in the morning a habit. This is exactly the type of customer that a pub with a nice machine and an early opening could attract.
The picture is complicated by the fact that capturing morning commerce involves more than just turning on a bean to cup machine and opening the door at seven. Pubs that are located close to transportation hubs and on high streets have a clear advantage over those in rural villages that rely on passing trade. Research shows over half of people who drink coffee outside of their homes now look for premium or specialty beans, and 70% of them regularly prefer specialty coffee. This indicates that consumer expectations have significantly increased. People will not return for a subpar flat white in a plastic cup. The cost of entry is the investment in tools, beans, and a staff member who truly knows what they’re doing.
Looking at this from the outside, it’s difficult to ignore the fact that the bars that treat the morning day section as an afterthought are the ones most likely to have trouble. The successful operators appear to have made the realistic decision that the pub can no longer afford to let a coffee shop across the street turn over its fourth cover every day while three or four hours of potential trade time remain empty.
“That early part of the day looks like it could be a growing market, we hardly get any bookings past 7.30pm anymore”, stated Clive Price, CEO of Barons. Something has truly changed when an evening led business begins to think that way. The morning trade data at least indicates that the demand is there, waiting, and won’t wait forever. It has to be seen if enough of the pub industry changes with it, swiftly enough.
i) https://www.merchantswitch.com/blog/pub-profit-margins-uk-guide
ii) https://www.ibisworld.com/united-kingdom/industry/pubs-bars/3446/
iii) https://mysticdrink.com/pub-profit-margins-what-uk-owners-should-know/
iv) https://www.karaokeforbusiness.com/blog/average-pub-revenue-in-the-uk-stats-2025
v) https://www.lumina-intelligence.com/blog/foodservice/uk-pub-market-2025-size-growth-share-statistics/