Costa Coffee: The UK Chain That Beat Starbucks in Britain

In the 1990s, as Starbucks was taking off in the U.S., another coffee chain was quietly building a different kind of empire across the pond. This one didn’t come from Seattle, but from London—and by the turn of the millennium, it had overtaken its American rival in the UK. If you’ve ever wondered how Costa became Britain’s biggest coffee brand, the answer lies in a specific roast style, a precise blend ratio, and decades of strategic growth starting with two Italian brothers.

By 1999, Costa had 186 stores in the UK and was selling 3.7 million cups of coffee per week. It became the country’s leading coffee chain by 2010, surpassing Starbucks.

The Costa Brothers: From Wholesale to Retail

The story begins in 1971, when Italian brothers Sergio and Bruno Costa started a coffee bean wholesale business in London, supplying roasted beans to restaurants and Italian-style cafes. Drawing on Sergio’s training in Parma, Italy, they developed a unique approach to blending and roasting. Their signature method—slow, low-temperature roasting for 22 minutes—produced a richer, less bitter cup, avoiding the harshness of high-heat roasts. They also created a proprietary espresso blend using a fixed 6:1 ratio of Arabica to Robusta beans. This blend, known as MochaItalia, defined Costa’s taste profile and remains central to their coffee identity today.

From Family Business to Global Brand

In 1978, the brothers opened their first Costa coffee shop in London. With help from family and friends, they expanded at a steady pace of two new stores per year. By 1988, they relocated their roastery to Old Paradise Street in Lambeth, London, allowing better storage for green beans and roasting equipment. This move supported rapid scaling. The 1990s saw explosive growth: by 1999, Costa operated 186 UK outlets, serving 3.7 million cups weekly by 2000. The brand expanded beyond standalone shops into high-traffic retail locations including WHSmith, Homebase, Marriott hotels, Waterstones bookstores, and Ottakers.

International Expansion and Whitbread Ownership

In 1995, Costa was acquired by Whitbread plc, a major British hospitality company founded in 1742. Whitbread, which also managed brands like Marriott and TGI Friday’s, gave Costa resources to accelerate growth. By 2010, Costa had 1,069 stores across the UK and became the country’s largest and most visited coffee chain. Globally, it operated 442 stores in 31 countries including China, India, the Middle East, Eastern Europe, and Russia—but not North America. The brand’s largest store, in Dubai, seated 320 people.

Costa in China: Going Toe-to-Toe with Starbucks

Costa entered China in 2006, opening its first store in Shanghai’s Nanjing Road pedestrian street. In 2008, it launched in Beijing and quickly grew to 43 outlets. Unlike Starbucks’ American-style coffee culture, Costa positioned itself as “European, with aristocratic flair,” and priced slightly higher. Rather than pursuing global uniformity, Costa adapted store design and offerings to local tastes. By 2011, it had adopted an aggressive expansion strategy, often situating stores directly beside Starbucks outlets—a “co-location” tactic similar to how McDonald’s and KFC are often found near each other. This approach leveraged Starbucks’ brand recognition while saving on market research costs. Costa’s Asia president set a target of 2,500 stores in China by 2018, aiming to claim one-third of the market. At the time, China’s coffee market was growing at 15% annually—far outpacing the global average of 2%.

What Makes Costa Coffee Different?

Costa emphasizes quality at every stage of production:

• All Costa coffee is slow-roasted at low temperature for 22 minutes, enhancing natural aromas and creating a smoother, less bitter cup compared to high-heat methods.
• The brand’s signature espresso is a proprietary blend of 6 parts Arabica to 1 part Robusta, developed in-house.
• Baristas in every Costa location receive specialized Italian-style training to prepare espresso drinks fresh on-site.
• The company invested over £1 million in new roasting equipment at its Lambeth Roastery, later expanding capacity to 65 tonnes per week.
• Coffee is handcrafted by baristas rather than produced via automated machines.
• Costa offers Fairtrade-certified coffee options and sources tea from Cafédirect’s TeaDirect range.
• Beans are imported from nine countries across South America, East Africa, Asia, and the Far East, blended in a unique proprietary ratio.

Frequently Asked Questions

When was Costa Coffee founded and by whom?

Costa Coffee was founded in 1971 by Italian brothers Sergio and Bruno Costa, who started as a coffee bean wholesaler in London before opening their first retail shop in 1978.

What is the roast style used by Costa?

Costa uses a slow, low-temperature roast for 22 minutes, which enhances the coffee’s natural aroma and results in a smoother, less bitter cup without the harshness of high-heat roasting.

What is the blend ratio in Costa’s signature espresso?

Costa’s unique espresso blend consists of 6 parts Arabica beans to 1 part Robusta beans, a ratio developed in-house that defines its distinct flavor profile.

How did Costa grow so quickly in the UK?

With support from family and friends, Costa expanded at a rate of two stores per year after 1978. By the 1990s, strategic roastery investments and store placements in high-footfall retail and transport locations helped fuel rapid growth, reaching 186 UK stores by 1999.

Is Costa Coffee available in the United States?

No, despite its global presence in over 30 countries, Costa Coffee has not entered the North American market, including the United States.

How does Costa differentiate itself from Starbucks?

Costa positions itself as having European, especially Italian, heritage with a more premium positioning. It adapts its store designs and coffee offerings to local markets rather than using a standardized global approach, and often locates stores near Starbucks to capitalize on foot traffic.

Recommended FrontStreet Blends for Costa-Style Coffee

For fans of Costa’s bold, smooth espresso blends, FrontStreet Coffee’s Classic Blend delivers rich crema and full body with notes of dark chocolate and caramel—perfect for milk drinks. The Black Cocoa Blend offers a deep, intense profile with cocoa undertones, mirroring Costa’s signature strength. Both are crafted for espresso and milk-based drinks, using high-quality sourced beans roasted to enhance sweetness and balance. Freshly roasted within 5 days · Orders placed before 17:00 ship the same day · Next-day delivery across most of Guangdong Province.