Hot Drinks in Estonia

COVID-19 impact on hot drinks

Despite some short-term stockpiling in March 2020, initial consumer panic diminished fairly rapidly as supplies of hot drinks were relatively unaffected and consumers were still able to shop at grocery outlets and online. As a result, unit prices remained stable, and unit price growth was actually slower than the previous year.

COVID-19 country impact

On 13 March, the government declared a state of emergency until 1 May, and all recreation and leisure outlets closed, including gyms, saunas and day care centres. Full border controls were imposed from 17 March, with only Estonian citizens, permanent residents and relatives and freight transport workers permitted to enter.

Company response

Estonia is a digitally advanced country, and many major players had established an online presence and digital shopping channels prior to the COVID-19 pandemic. As a result, it was relatively straightforward for players to develop their e-commerce and delivery capabilities and continue to offer hot drinks to their customers.

Retailing shift

Although grocery stores were not closed in Estonia during the lockdown in spring 2020, online sales increased significantly, as greater numbers of wary consumers sought to limit face-to-face shopping experiences and preferred the convenience of shopping from home. Major grocery retailers in the country, such as Rimi, Maxima and Selver, either initiated or expanded their online shopping systems sales during the lockdown, adding momentum to online sales of hot drinks.

Foodservice vs retail split

There was a significant decline in foodservice sales of hot drinks in 2020 as a result of the lockdown measures imposed by the government; however, these sales did not directly transfer across to retail, which recorded only moderate growth in volume terms across coffee, tea and other hot drinks, with tea registering the strongest retail volume growth of the three categories. Hot drinks is not a significant part of foodservice home delivery portfolio, and therefore sales in this respect remained fairly small.

What next for hot drinks?

Coffee will remain the most popular hot drink in Estonia, continuing to outpace other hot drinks categories across the forecast period. Although the enduring popularity of coffee will enable sales to bounce back quickly in 2021 as consumers return to cafés and restaurants, 2021 is likely to be a problematic year for tea and other hot drinks.

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