A Study on the Impact of COVID-19 on Costa Coffee Operations in London

This research project analyzes the impact of the COVID-19 pandemic on Costa Coffee, a British coffee house, focusing on its operations in London. The study examines the evolution of the pandemic, its effects on the coffee industry's profitability and operational efficiency, and the strategies Costa Coffee can employ to regain market share and attract consumers. It also identifies challenges faced by the company in attracting consumers and recommends potential solutions. The report includes a literature review, research methodology, data analysis, findings, conclusions, and recommendations, providing a comprehensive overview of the pandemic's impact and potential recovery strategies for the coffee shop. The project aims to understand the pandemic's impact on operational efficiency, identify effective consumer attraction strategies, and determine the challenges hindering consumer engagement. The findings are relevant for other businesses in the hospitality industry and researchers studying similar topics.

RESEARCH PROJECT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
Background.................................................................................................................................3
Aims and objectives....................................................................................................................3
Significance.................................................................................................................................4
Rationale.....................................................................................................................................5
Dissertation structure..................................................................................................................5
Chapter 2: Literature Review...........................................................................................................7
Evolution of pandemic situation and its impact over profitability and operational efficiency of
overall coffee industry................................................................................................................7
Strategies to regain their market share and attract more of the consumers.................................9
Different challenges which create issues for attracting the consumers.....................................11
Chapter 3: Research Methodology.................................................................................................13
DATA ANALYSIS AND FINDINGS..........................................................................................17
Discussion.................................................................................................................................26
CONCLUSION AND RECOMMENDATION.............................................................................28
Conclusion................................................................................................................................28
Recommendation......................................................................................................................29
REFERENCES..............................................................................................................................30
Abstract..........................................................................................................................................32

INTRODUCTION
Background
In the present competitive error the economy is being affected by the pandemic to a great extent.
This is particularly because of the reason that the current pandemic it has affected the operations
of the companies in a great manner. Thus for the success of the company it is very essential for
them to analyse the impact of the current covid-19 over their businesses. The major reason
underlying this factors that in case the company will know the impact relating to the current
covid-19 than they can effectively manage the business. Along with this the current covid-19
also affected theme overall economy as well. But the hospitality industry is the one which is
widely affected by the effects of pandemic. Does it is very essential for the researcher to conduct
the research over the impact of the current covid-19 over the coffee shops within London. The
present study is based on Costa coffee which is a British coffee House.
The company was founded within the year 1971 by Bruno Costa and Sergio Costa. The
company is headquartered in Dunstable within UK and is a wholesale operation supplying
roasted coffee to all the caterers and specialist within Italian coffee shops. The current research
will outline the different impact which the current covid-19 has created over the working and
operations of the Costa coffee. In addition to this the evolution of the pandemic situation and its
impact over the overall coffee industry will be analysed with help of some key data. in addition
to this the different strategies will also be analysed with the help of which the Costa coffee can
try to regain the market share. This is very essential for the company as if they will not work
properly in increasing the attractiveness of coffee shop among the consumer then this will affect
the business. Along with this the research will also outline some challenges which affect
company and attracting the majority of the consumers.
Aims and objectives
Aim
To analyse the impact of the pandemic that is COVID 19 over the coffee shops in London. A
study on Costa Coffee.
Objectives

 To understand the evolution of pandemic situation and its impact over profitability and
operational efficiency of overall coffee industry.
 To examine the different strategies through which Costa Coffee can try to regain their
market share and attract more of the consumers.
 To determine the various kind of the challenges which create issues for Costa Coffee in
attracting the consumers.
 To recommend some of the ways in which they can attract the consumer in great and
effective manner.
Research question
1. What is the understanding and impact of pandemic over operational efficiency of the
coffee shop?
2. What are the different strategies through which the consumer can be attracted relating to
the coffee shop?
3. What are the various types of the challenges which restricts in attracting large number of
the consumers?
Significance
The present covid-19 has affected the whole hospitality industry to a great extent. Does it
is very essential for the companies within the hospitality industry to analyse the different
strategies in order to evaluate the strategies through which the company can increase the
demand. The major reason behind this fact is that this research is of significance to all the
companies within the hospitality industry in order to ensure the different strategies through
which the sales of the company can be improved. in addition to this the present research is of
significance to Costa coffee as it will assist the company in understanding the different
challenges which can affect the process of attracting the consumers. In addition to this, the
current study is also of significance to other competitors of Costa coffee. The reason behind this
fact is that the strategies used by Costa coffee can also be assistive to other competitors in
attracting the consumers. In addition to this the present research is of also significance to other
researchers who are also undertaken the research was similar topics.
Rationale
The current pandemic has affected the economic situations of all the countries to a great
extent. In addition to this thing economic condition of the hospitality industry has been affected

in a great manner. Hence the major reason behind selecting the analysis of impact of pandemic
over the working of coffee industry is to increase the popularity of coffee shops among the
consumers. This is particularly because of the reason that with help of this present study the
company will be able to effectively attract the consumers to a great extent. In addition to this
another reason for selecting the present study is that this will also assist the company in
improving their business. This is because of the reason that when the company will evaluate the
different strategies for attracting the consumer than this will definitely result in increase in
operational efficiency of the company. Another major reason for selecting the topic is the
personal and academic interest of the researcher.
Dissertation structure
Chapter 1- Introduction
The introduction chapter release with the introductory part of the research where in the
brief introduction of the topic is being provided along with the aim and objective of the study.
This chapter also highlights the significance and rational a relating to the selection of the topic of
research.
Chapter 2- Literature review
The second chapter that is the literature review is being defined as the chapter which
deals with providing the theoretical knowledge relating to the key objectives of the study. Under
this is the viewpoint of different authors is being highlighted in order to explain the research
topic and the different research questions.
Chapter 3- Research methodology
Further the next chapter deals with theme identifying of the methods of research which
are essential in order to complete the research in successful man of earth stop it is very helpful
for the researcher to outline all the different methods of research necessary to complete the study
successfully are being listed in this chapter. And the present study will outline the various
methods use like the qualitative or quantitative research, the philosophy of research along with
the approaches and different data analysis techniques will be highlighted in this chapter.
Chapter 4- Data analysis and findings
The chapter 4 deals with the analysis of the data collected and the findings being
highlighted. The major aim of this study is to analyse the collected data to prove the objectives of
the hypothesis of the research to be correct. Hence in this chapter the collected data will be

analysed with help of different data analysis tools and the findings will be presented with help of
graph, chart and interpretations.
Chapter 5- Conclusion and recommendation
In the last chapter that is the conclusion and recommendation all the conclusions of the
finding a being highlighted in order to provide a brief summary of the key findings of the
research report. In addition to this sum of the recommendation for improving the research and for
improving the company's performance are being provided. These recommendations will assist
the company in improving the performance by adapting to these recommendations.
Chapter 2: Literature Review
Literature review chapter is a part of research project that depict the views and opinions
presented by different authors over the topic of study. This is an important part of research study

where the opinions stated by the scholars are represented to project the best suitable information
and knowledge over the topic of study.
Evolution of pandemic situation and its impact over profitability and operational efficiency of
overall coffee industry.
As per the views presented by the Rafi (2020), the entire world has noticed the pandemic
situation. The effect of pandemic is such that based on the guidelines issues by the world health
organization lockdown is being imposed in United Kingdom. The lockdown situation couldn’t
let the business ventures to open up the restaurant and other such entities. This is important for
the overall growth and development practice of business entity to open up stores so that company
can attract customers and sale the products offer by the business entity. Especially the coffee
shops are totally based on the customer attraction. Pandemic could not let the coffee houses to
open up the stores which fundamentally stopped the income or the inflow of the income in the
business. Pandemic has completely stooped the business life cycle that could somehow imposed
many restrictions as a business undertaking. This is important fact part of the business house that
the ventures should be open up in respect to attract potential customers in the market. The role of
the business entities is essential in attracting the potential customers of the organisation in
respect to sustain an operational flow in business.
On the basis of the views projected by the Nordmann and et.al. (2020), the impacts of the
covid pandemic has been drastic and such that the guidelines issues by the world health
organisation related to covid pandemic is such that social distancing like norms. This could cost
extra financial resources for the companies to deliver the same level of operations. All this could
completely damage the business and growth possibilities of the business unit. Social distancing
norms could minimise the overall space of the coffee houses and such other aspects. The extra
cost incurred by the coffee houses to cope up with the covid 19 guidelines has been charged
agabst the sales process charge by the company. All this certainly decreased the profit margins
earn by the business venture. Profit making is among the core objectives behind the business
operations entertained by the organisation. Due to the extra cost incurred by the company the
profit percentage could minimise or restrict in favour of the business undertaking. It could
certainly restyrict the company in meeting up the overall objectives set behind the business
operations entertained by the company.

The criticism has been made by the Narula and et.al. (2020), in its study over the covid
19 impacts over the coffee houses in United Kingdom. This has been evaluated the pandemic
situation could completely shatter the entire business growth and development possibilities in the
market. The impacts of the pandemic has been drastic that the business ventures could not
entertain and run the regular business operations which could completely stop the business
undertaking in entertaining and meeting up the final business objectives. The role of the
pandemic is such drastic that the entire growth situation could minimises by the business
environment. The lockdown could not let the business venture to sale the products and to run the
business operations. Along with this the cost of producing the same products in the market has
also increased due to the pandemic like situation. On the basis of the views illustrated by the
Morton (2020), it has been certainly indicated that the pandemic has increased the cost of
producing the final products. This could certainly reduce the profits of the company. As the
company could not increase the sale prices in comparison to the increased cist which has directly
reduced the profitability of the business entity. This has also impacted negatively over the
growth and development of business possibilities of the company. Growth and profit making is
among the core objectives associated with the business venture. The role of the covid pandemic
is such that company could not meet its core business objectives. The stakeholder engagement
has also shattered due to the low profit and growth rate achieved by the coffee houses in the
market. There are many business reports has depicted that as an impact of the covid pandemic
many coffee houses has reported the negative growth rate. This could also raise about the
question of sustainability of the business house in market.
As per the views stated by the Milojevic and Katsadze (2020), covid 19 pandemic could
completely loose the stakeholder trust in favour of the business venture. Especially the investor
of the business venture could not offer the possible engagement of the stakeholders and other
investors associated with the business entity. This has challenged the business entity at a huge
level in against to the pandemic crisis. The trust of stakeholder in business operations and overall
growth of the company has been massive. It has certainly changed the mindset of the investor as
many of the stakeholders looking for the business expansion and growth oriented opportunities
could stop all the plans that can allow such people to gain the effective financial returns and
outcome as a business venture. It is certain that the business venture has been effectively allowed
to manage the business operations but due to the pandemic like situation all operations that

business venture are operating could damage all the chances and opportunities related to the
profit making perspectives. This is another drastic impact that covid 19 pandemic has faced in
against to deliver the business operations. It has been very essential for the business venture to
certainly allow the major business expansion and growth oriented opportunities. Due to the
pandemic situation the already operating business ventures are also not being able enough to
deliver and approach the best level of business growth and development possibilities.
Strategies to regain their market share and attract more of the consumers.
The views projected by the Memon and et.al. (2021), about the strategic choices available
with the companies engaged in coffee business. The post covid situation has been strongly
challenging for the companies at a global level. Especially the business venture that has been
involved under the coffee business this is strongly favourable for the business houses to clearly
implement all the plans that can empower the best level of business growth and development
possibilities. Business ventures can adopt the social media marketing strategies. This is a crucial
strategic choice that is available in front of the business entities as it supports the business houses
to effectively promote the products and services offer by the business venture. This strategy
would allow the company to regain the brand value even after the impact of pandemic. This is
essential in the coffee business to hold a strong brand value that can empower the companies and
business undertaking to approach the best possible growth and business development
possibilities.
The criticism has been made by the Leclerc, Murray and Ircha (2021), about the use of
the social media strategy. This model is only capable enough to attract a particular customer
base. The young people are certainly active over the different social media platforms. This make
is more effective for the company to encourage the overall strategic growth of the business
venture. This strategic choice could risk the entire business model at a huge level. The data
protection becomes the major challenge associated with the business house. Data safety is always
a priority aspect of every business growth and development possibilities. As the social media
marketing do not cater the strong control over protecting data and personal information related to
the business idea. This can certainly empowered the business unit to certainly approach the
business in the best way possible. Due to the data and information leakage issue this is a high
possibility that company get to face a strong failure in against to deliver the business operations.

The views illustrated by the Igbinakhase (2021), is such that company can also follow the
competitive pricing strategy. This is a strong strategic choice that would favour the organisation
to attract the customer even in the situation of pandemic. This is pretty obvious that due to the
pandemic like situation many people get to lose the job and employment opportunities in market.
This strategy would also attract to the customers that has also loose the job to come and explore
the various coffee products. The competitive pricing policy of the business venture would also
attract the competitive advantage in favour of the business venture. This is essential for the
business undertaking to take on the competitive advantage by attracting all the products at the
most affordable price range. Pricing become an important tool that attract the customers to have
and entertain the products offer by the company. This strategy would attract all types of customer
base start from the middle class to upper class economic background people. This makes it more
essential for the business unit to effectively approach target customer base and profile.
The Høier, Chaaban and Andersen (2021), has criticised the use of the competitive
pricing policy. This is a strategy where company offer the products at a price where business
venture can easily attract all its potential customers available in the market. This strategy
certainly allows company to attract more customers but it is equally difficult for the business
venture to cope up with the desired profit margin. The profitability is among the core business
objective and with support of this strategic choice company require to lose the expected profit
margin business can offer to its operations. The criticism has been made on the ground or the fact
that loosing profitability margin becomes the essential task that certainly restricts the business
venture and entity to approach the operations in the best way possible.
As per the views stated by the Alexandri and Janoschka (2020), company can adopt the
safety and strong health measures. The pandemic could make the people and customers in the
market more aware about the safety and hygiene like aspects of products. This is important that
the business entity get engaged in all these aspects and factors so that trust of the customers
could have been gained by the business venture. This will certainly empower the organisation
and business entity to approach the business objectives in the best way possible. This is an
important aspect associated with the business model that the company take care of all the health
and safety like margins. If the business entity would get engaged into all these aspects than it
would favour and empower the company to approach the requirements and needs of the target
customers in the best way possible. This will not only motivate thee existing customers of

company to sustain in the business but along with that it also empower the new customer base to
come and explore the business possibilities in the market. This strategic choice would certainly
allow the organisation and venture to expand the growth rate and profit margins and possibilities
related to the business in the best way possible. This is among the key strategic choices available
with the company that can easily be used by the company in against to deliver the overall
strategic growth and development possibilities even in the situation of covid pandemic and the
post pandemic situation.
Product development is another strategy that company can adopt in order to regain the
market share even after the situation of covid 19 pandemic. This strategy will favour the business
entity to achieve the best level of business growth and development possibilities’. This is
essential for the company to understand the market requirements and based on that approach the
best possible strategic choice that can empower the business unit to boost up the existing market
share of the business enterprises. The views of the Szromek (2021), supported to use of this
strategic choice a sit guide the company in such way that the organisation gets to attract new
potential customers in against to deliver the business objectives associated with the organisation.
Different challenges which create issues for attracting the consumers.
Market is full of competitive forces that restrict the company for achieving the business
objectives. Attracting customer is a huge challenge that company face. The coffee product offer
potential level of profitability margins. The markets full of aggressive level of competitive
factors that do not favour business enterprises for taking up the competitive edge in the
respective market. Badat, Ocampo and Yong (2021), depicted the fact in its study that
availability of plenty of business enterprises is always tough for the business venture to handle
and attract the similar business objectives. This creates a huge challenge for the business venture
to attract the similar number of customers. Availability of multiple options always distracts the
business enterprises to sustain more effective growth and business advancement practices. This
also restricts the company for keeping prices of products at a lowest level. This is essential for
the business entity to effectively approach the best level of business growth and development
possibility of the organisation.
As per the views reflected by the Nguyen and et.al. (2020), it is indicated that the pricing
is another key challenge that company require to face in against to deliver the business
operations. In case the business entity charge more than the average level of prices companies

are charging in market than it would negatively affect the decision making of the potential
customer in market. This would certainly influence the decision making of the target customer
for entertaining the product and services offer by the company. If the company charges the usual
prices in order to sale the product than there is a high possibility that the business entity get to
loose the customer base. This is a usual circumstances associated with the business entity that the
company and business entity get to deliver the business operations at a sacrificed pricing
structure. As per the views illustrated by the Limsuwan (2021), this is certainly indicated that
company require to mitigate the profitability margins at a prices where the business entity get to
deliver all its business objective. The challenge is always associated with the level of price
company charge. Every customer in the market always motivated towards buying the product
that can cost them less as compare to other products. In case of company do not reduces its
pricing than this would certainly allow the extra cost to business entity. This is a huge challenge
associated with the business entity as it is not allowed to charge the cost that is desired by the
business entity in against to deliver the business objectives.
The illustration over the topic done by the de Queiroz and et.al. (2018), was such that
inflation in economy is also considered as among the major challenge part of the business entity
when it comes to deliver the business operations of organisation. Inflation directly influence and
restrict the buying capacity and ability of the potential customer in market. This is an important
element that restricts the company to achieve all its various business objectives in the best way
possible. The factor is very significant in nature that can drive and guide the company at such
level that the organisation do not get to achieve the sales targets. The role of inflation is directly
under to reduce the income or the purchasing power of potential or target customer and to restrict
the overall potential ability of the business enterprises in order to achieve the business objectives.