Greggs has surpassed Costa Coffee to become the largest branded coffee operator in the United Kingdom, according to the Project Cafe UK 2026 report by Allegra World Coffee Portal. The bakery chain reached a total of 2,737 outlets after opening 34 new locations in the first half of the year. This marks the first time Greggs has overtaken Costa, which currently operates 2,707 sites.
The change in market leadership follows a period of expansion for Greggs and financial challenges for Costa. Earlier this year, Costa Coffee reported losses exceeding £13 million for 2024. Additionally, a planned sale of the brand by its parent company, Coca-Cola, was canceled after interest and bids were reportedly lower than anticipated. Costa is currently focusing on a refurbishment program and refreshing its product range.
The Allegra report indicates that the total UK branded coffee economy reached a value of £6.8 billion in 2025, representing a 5% year-on-year increase. The number of branded outlets across the country grew by 3.5% to more than 12,300 locations. While Greggs is traditionally known for savory pastries, its 2025 annual financial report noted that it has increased its market share in categories including coffee, breakfast items, and iced drinks, ranking first for value on YouGov’s Brand Index for quick-stop services.
The change reflects a shift in how people spend money. While profit margins remain narrow—with one industry executive reporting a profit of just 18p on a £4.10 drink after energy and labor costs—consumers are mixing high-end preferences with value purchases. This trend may continue as the price of imported coffee beans is projected to rise further due to climate events such as El Nino, which may place additional pressure on higher-priced competitors.
Looking ahead, Greggs has stated its intention to open more than 100 shops in total throughout 2026. The company has set a long-term target of reaching 3,500 outlets, including its smaller "Bitesize" store format. Meanwhile, Costa will proceed with its refurbishment strategy. The industry will continue to monitor caffeine levels and value rankings as competition intensifies across the £6.8 billion sector.