February 26, 2020

How to Profitably Serve Cold & Sparkling Drinks in a Coffee Shop


The market for cold drinks is growing rapidly. From sparkling teas and lemonades to cold brew coffee, customers are increasingly thirsty for a more refreshing beverage than the traditional coffee shop offerings. And businesses that don’t serve these risk losing out to competitors.

But which cold and sparkling drinks should you be serving? And how can you do this profitably and efficiently? Let’s take a look.

Lee este artículo en español Cómo Servir Bebidas Frías y Con Gas en tu Café de Forma Rentable

Cold drink with lime and ice. Credit: Sebastian Franzén

Why Serve Cold & Sparkling Drinks?

While coffee shops could just set up a fridge with name-brand canned soft drinks, this is a lost opportunity. Meeting the demand for cold drinks with a well-planned menu opens up the potential for greater profit margins, brand reinforcement, and a more premium experience for customers.

A Growing Demand For a Wider Menu

Olwyn Ledwidge is Events & Digital Marketing Coordinator at Marco Beverage Systems, which specialises in water boilers and brewing equipment, including the award-winning three-temperature Mix font and the newly launched hot, cold, and sparkling undercounter water system FRIIA. She tells me that consumers are shifting away from alcoholic and sugary soft drinks in favour of healthier, fresher options such as sparkling water and infusions. 

This is particularly true of younger consumers. Health Survey for England data reveals that almost one in three people in England aged 16–25 doesn’t drink, compared to one in five in 2005. The shift away from alcoholic and sugar-loaded drinks gives other beverages such as cold brew coffee, kombucha, sparkling teas, and housemade lemonades room to grow. 

“Consumers these days have more knowledge about, interest in, and access to different types of beverages and are, overall, more health-conscious,” Olwyn says. She adds that consumers will usually look for these more adventurous beverages in coffee shops, as they tend to lead the way in innovation. 

At the same time, consumers tend to be more conscious of environmental sustainability, rejecting straws and opting for plastic-free packaging. “Making drinks in-house means that coffee shops can reduce their single-use plastics and waste,” Olwyn points out.

High Profit Margins 

While there might be an initial outlay for new equipment, sparkling teas and lemonades are easy to make and the ingredients are relatively cheap.

“Tea concentrates and syrups, which are diluted with sparkling or cold water, offer great margins to the retailer, with the bonus that customers are often willing to pay a little more for the premium, fresh, healthy options,” Olwyn says. 

Patrick Geer, Cold Brew Operations Manager at Draft Coffee Solutions in Boston, says that these beverages can also increase profit margins because they can be produced in bulk and don’t require as much supervision as other specialty beverages. “You get it all done at once [when you] do one big batch of ice coffee [and] that’s easier than making 50 pour overs,” he says. 

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Serving nitro coffee on tap. Credit: Draft Coffee Solutions

Menu Variety

“Coffee shops that create new and exciting cold-drink menus can really showcase their brand, their personality, and keep customers and staff engaged,” Olwyn says. 

Launching a line of sparkling lemonades for the summer can establish the brand as innovative and attract customers curious about the new flavours on offer. You can experiment with different ingredients such as loose-leaf teas, concentrates, syrups, crushed herbs, fruits, and more to create a diverse menu. 

Providing it’s not overwhelming, customers generally appreciate an extensive menu. Matt Lee, General Director at La Marzocco Korea, says that this means customers feel confident going to your coffee shop because they are sure that they will find something they like on the menu. “Sometimes when you don’t want one of those [beverages on the menu], you just go to a different café,” he says. 

“[House-made drinks] allow the coffee shop ultimate control over their menu and ingredients. It provides flexibility and creativity, allowing coffee shops to change and adapt according to their customers’ tastes, seasons, or busy periods,” Olwyn says.

A cold mocktail. Credit: Sebastian Franzén

Which Drinks Should You Serve?

With so many options, it’s easy to stand out from the crowd, but you need to make sure the drinks you choose appeal to your customers as well as to you. “As a coffee shop owner, you should know your customers’ tastes and expectations, and this should determine your cold and sparkling menu,” Olwyn says.

“If your coffee shop prides itself on innovation, you can afford to be a little more adventurous.

Think about tea concentrates, infusions, or kombucha. If you have a slightly more traditional feel, start simple with recognisable ingredients and recipes, such as fresh lemonades and iced teas.”

Before any drink is added to your menu, you need to carefully consider if it is financially and operationally viable. While tea concentrates and syrups are relatively inexpensive, garnishes and exotic fruits can soon push costs up. You may also need to pay extra for sustainable and quality ingredients. 

However, Patrick says that this should be fine if you have a reputation for sourcing direct trade and sustainable products. “If you’re known for doing that, your customers will appreciate that you put the effort in,” he says. 

Olwyn suggests checking with your coffee suppliers, as they can also offer solutions for cold and sparkling drinks such as syrups, concentrates, and ready to drink options.  

If a drink’s price is putting off customers, could you substitute an ingredient for one that doesn’t eat into your bottom line as much? She adds, “Remember, cold and sparkling drinks can be made in batches and you can always tweak and experiment.”

Trial and error will likely be a key part of your menu development process. Patrick recommends starting “one [new drink] at a time and carefully” so as not to overwhelm staff or customers, and getting feedback from staff and customers before investing in a new drink.

“Not everything works,” he says. “And that’s the truth of it is, you know, we’ve had a lot of different ideas and not all of them work.”

Ready-to-drink sparkling teas and cold brew coffee. Credit: Draft Coffee Solutions

How to Incorporate Cold & Sparkling Drinks in Your Menu

The difference between a successful and unsuccessful menu item often comes down to how well planned the processes are. You can create a delicious drink that customers are happy to pay for and has a good per-item profit margin, but if the processes are poor, you will still receive complaints and find your costs rising. 

  • Equipment & Operations

Olwyn advises thinking through how the drinks will be made. Knowing how long it will take to prepare a drink is crucial. It helps you plan staffing and processes, and lets you know how profitable an item really is. Cheap ingredients won’t compensate for having to hire an extra staff member to fulfil the same amount of orders.

“If you’re in a fast-paced service environment, your cold and sparkling drinks shouldn’t be too complicated to serve,” Olwyn stresses. “Make sure your staff is comfortable with the new drinks… and all your required ingredients are quick to hand.” 

If you can do part of the beverage preparation beforehand, it will also increase efficiency. Olwyn says, “For cold and sparkling drinks, we recommend creating a large batch of concentrate or syrup at the start of the day which can be topped up with ice and filtered water from like the Marco FRIIA, which can deliver hot, cold and sparkling water from one sleek tap.” 

Using garnishes or adding fruit? You can still do part of this beforehand or in quiet periods. “Added prep time for things like fruit, crushed herbs, and tea brewing can all be carried out before your shop opens,” Olwyn tells me.

She points out that beverage preparation time isn’t just about efficiency. It’s also about providing a friendly, personalised service. “Baristas can prep and serve premium cold and sparkling drinks in a matter of seconds without ever turning away from the customer,” she says.

Good organisation is also crucial to efficiency. Where will you store syrups and concentrates? How much can you store? Patrick says that sparkling water and seltzers “are very popular” and suggests brewing them in bulk – but this requires space. 

“You can definitely get good margins on that because you’re not really doing much to it…,” he explains. “It’s definitely attractive for business owners if they have a way of consistently doing it and if they can make their batch size, you know, five gallons instead of one gallon or 50 gallons instead of five gallons.” 

He tells me that there are many tools that will help baristas in their drink preparation. However, he advises that coffee shop owners do their “homework” to figure out what is the best fit for their shops. “It’s just about putting in your time, doing the research and making sure that this item or device or dispensing mechanism is really what is going to work,” he says.

An iced beverage with a garnish. Credit: Sebastian Franzén

  • Staff Training 

Your staff are responsible for the beverage’s quality, consistency, and food safety. Matt advises standardising procedures as much as possible. “It would be very important for the staff to know exactly what step he or she should go through to make that drink and serve it to the customer,” he stresses. 

The more precise the recipe and the greater control over the variables, from water temperature to ingredient freshness, the better. Some of these can be managed with temperature-precise water boilers and fonts, but staff will need to be trained on the importance of these points.

Staff members are also key to marketing the drinks. Patrick says, “Aside from just making sure that they know how to use the equipment or they know how to properly serve customers, I think the next important piece is making sure that your staff knows what the drink is because customers are always going to ask lots of questions…

“The more your staff knows, the better they can help customers… But most of the time, it helps them make a sale on the new product.” 

Good staff members aren’t just informed but also genuinely passionate about the beverages they serve. Olwyn suggests including your team in the menu development process. “They will be more enthusiastic, knowledgeable, and engaged [as a result],” she says. 

Cold brew coffee over ice. Credit: Sebastian Franzén

The benefits of offering cold and sparkling drinks are powerful: strong profit margins, product diversity, attracting customers, and meeting existing customers’ needs. Some careful preparation and planning, from menu design to staff training, is all that is needed to make this a successful addition to your menu.

Enjoyed this? Read What Café Owners & Baristas Need to Know About Water Quality

Written by Gisselle Guerra.

Please note: This article has been sponsored by Marco Beverage Systems.  

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