Hybrid and remote working continue to take their toll on the once flourishing office lunch trade as businesses wait anxiously to see if habits have changed for good.
Two years after the great office abandonment, coffee shops, sandwiches and salad bars are reporting that business in the once thriving spaces has dropped by as much as 60 pcs.
The news comes as ‘Lunchflation’ has looked at the cost of ingredients, as well as the cost of packaging, labor and energy costs for lunchtime staples including salads, meats, grains and vegetables.
Chopped’s owner Brian Lee, which has 50 locations across the country, said it was “shocking” that his outlet at Grafton in Dublin continues to be 60pc below pre-pandemic levels.
If this continues, the whole scenario will change, he said. “We are still nowhere where we used to be in office spaces before Covid-19. We’ve seen a surge in the last three weeks, but it’s certainly nowhere near where it used to be. Even the buyers are not going to the city center the way they used to.”
Most firms have taken a hybrid approach – one, two or three days a week – but flexi-work means many are choosing Mondays and Fridays as their work-from-home days.
“Businesses tend to close at the beginning and end of the week because people are choosing Tuesday through Thursday as their days to come into the office,” said Mr. Lee, who will consider moving some outlets to residential areas. “If sales do not reach a certain level”, the office world has changed forever, “but what level it will reach remains to be seen”.
Inflation crisis is also hovering at home. “I don’t know of a component that hasn’t grown,” Mr. Lee said. “Chicken is through the roof. Grains, nuts, even lettuce are on top. The packaging cost is insane too. It costs €3,000 to ship a container from the Far East for bags, disposable gloves and cutlery Used to come in. Now it costs €15,000.
“Nobody wants to increase prices, but wages and energy costs are also going up, it is a ‘squeeze, squeeze, squeeze.’
Keith Ryan, owner of Boca Coffee and Sandwich Bar in Dublin’s IFSC, said his business is back to 70pc of pre-pandemic levels, a huge improvement over the business he reported earlier this year. “In January, business was 90 pc below pre-pandemic levels,” he said.
Employees of their biggest customer, PricewaterhouseCoopers, recently returned to the office three days a week. However, they have also seen an increase in costs. “Emails are coming in every day. Just yesterday I was told that the price of bread would increase by 10pc, the day before our coffee increased by 10pc, last week on milk by 15pc. It’s stable.”
James McCormack, owner of Dublin Barista School, which has a coffee shop on South Anne Street, was selling more than 500 cups of coffee a day, but says sales have dropped by 50 pcs.
“Coffee as a commodity has grown by 80 per cent last year,” he said. “Some coffee roasters may have lowered their prices – I am lucky we did here – but the price of coffee will have to rise in the short term for those who have not. A flat white that could cost €3.30 or €3.60 can go up to about €4.
“We still have morning rush, but with fewer people. Dewey Stockbrokers are one of our biggest clients. There is more flexible work – some of them two to three days a week and some of the buildings here Working from home for four days.
“Some people in Davis used to buy three coffees a day and now they can cut it down to two or one. It is very tentative how consumers will react. Everyone is feeling the squeeze and there is a fear of the unknown. ,
Alex Bruce, owner of the Soma coffee chain in Cork, is looking at how the business has affected office districts.
“We have three coffee shops, two in the city, which are busy, and one that we opened in the black market. [a new development of food stalls featuring local produce]Which is more office-based.
“He is not as busy now as our campus in the city. If we can get more people back into the offices it will be a big help to the business.”
Despite rising costs, Mr. Bruce expects customers to continue to pay for the little luxuries. “We roast all our coffee ourselves, so the price of our raw material, green coffee beans, has gone up by 20 to 30 pcs. We have raised the price of our coffee by 10c to cover our costs.
“Whatever is going on in the world, people will spend €3 or more to enjoy a cup of coffee or any other small treat during their day to make life a little easier. But, apparently, none Wants costs or prices to keep rising.”