In 2024, hot drinks in New Zealand is set against the backdrop of inflation, which has reached more than 20-year highs, peaking at over 6% in recent years. While some inflationary pressures have started to ease due to reduced consumer spending amid the cost-of-living crisis, coffee prices remain notably elevated.
The cost-of-living crisis has led more consumers to choose home-brewed beverages over frequenting cafés, with many hospitality venues closing due to shrinking household budgets in 2024. In response, some cafés are introducing creative offerings to attract customers, leveraging social media for visibility.
Competition remains intense within hot drinks in New Zealand. Nescafé, under Nestlé New Zealand Ltd, maintains a leading position, though closely trailed by Moccona from Jacobs Douwe Egberts NZ, with Avalanche Coffee Ltd in third place.
Supermarkets continue to be the dominant retail channel for coffee, though the pandemic’s influence has fostered enduring growth in e-commerce. Although post-pandemic online sales growth has slowed, e-commerce remains a vital channel as consumers increasingly turn to digital platforms to compare prices amid the cost-of-living crisis.
New Zealand’s high inflation and elevated interest rates have curbed consumer discretionary spending, impacting hospitality. Statistics NZ reported a 3% drop in electronic card spending on hospitality during the first half of 2024, resulting in closures of numerous restaurants, bars, and cafés.
In 2024, New Zealand faces a recession driven by high interest rates, with both private and public sectors reducing spending and headcount. However, tax relief introduced by the newly elected National Government, along with declining inflation rates, provides some relief for consumers.
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Hot Drinks
This report originates from Passport, our Hot Drinks research and analysis database.
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