Thriving coffee chain LAP Coffee from Germany poses a challenge to established local cafes.
LAP Coffee, a fast-growing startup chain in Berlin, is making waves in the local coffee scene with its aggressive expansion and unique approach to coffee service. In just two years, the company has opened 13 locations across the city, offering cappuccinos at an affordable price of €2.50.
The LAP Coffee model revolves around small, micro-space shops with strong branding, digitized ordering, and automated coffee machines. The target customers are not just coffee drinkers, but those who rarely buy coffee out, such as bike couriers, Gen Z students, and local creatives. The aim is to create a community space that blends affordability with a modern, tech-driven experience.
LAP Coffee partners with Berlin roaster 19grams, known for its commitment to ethical sourcing. However, the rise of LAP Coffee has prompted Phillip Reichel, a long-time figure in Berlin's indie coffee scene, to question the efficiency and digital transformation of his own processes. He sees LAP as a wake-up call, stating that they need to look at how they can make their processes more efficient and digital, and how they can better communicate their values.
Traditional, indie cafes are feeling the pressure from LAP's growth. To counteract this, they are responding by increasing efficiency, adopting digital tools, enhancing the communication of their unique values and product quality, and organising community events and collaborations.
LAP Coffee's expansion is not intended to replace neighbourhood cafes, but to attract a different demographic. The company has already opened branches in Munich and plans to expand to Hamburg next. Despite the concern among indie cafes in Berlin, LAP Coffee's founders, veterans of the startup world, are confident about the future.
However, the pricing model of LAP Coffee, with a cappuccino costing €2.50, is causing controversy. For instance, a cappuccino at Isla Coffee, a Berlin cafe, costs €3.50. Phillip Reichel criticises this pricing model as undermining the value of the product.
LAP Coffee uses fully automated devices for coffee preparation, with milk frothing done by hand. The compact cafes have few seats, creating an environment where bike couriers, Gen Z students, and local artists can meet. The company is backed by heavyweight investors such as HV Capital, Foodlabas, and Insight Partners from the US.
As LAP Coffee continues to grow, it remains to be seen how traditional, indie cafes will adapt and whether the company will become increasingly present in the coming years, potentially displacing many shops.
[1] Source: TechCrunch [2] Source: Berliner Morgenpost
- LAP Coffee, an entrepreneurial venture in the food-and-drink sector and backed by prominent investors, is leveraging digitized ordering, branding, and automation to create a unique cafe experience.
- To compete with LAP Coffee's small but efficient small-business model, traditional neighborhood cafes are embracing digital tools, enhancing value communication, and fostering a lifestyle-oriented environment for their target audience.
- As LAP Coffee's presence in the finance scene grows, with branches in Munich and planned expansion to Hamburg, questions arise about its long-term impact on the home-and-garden of traditional, indie cafes in major cities such as Berlin.
