Cafes & Coffee Shops in Australia: Market Size, Businesses & Forecast 2026

The Cafes & Coffee Shops industry in Australia provides food and beverages in a relaxed, typically small-scale setting, with coffee being the primary offering. The industry has shown resilience despite economic challenges, with sector output reaching $6.8 billion in 2022-23 (source: ABS). The sector is experiencing modest growth driven by premiumization and third-wave coffee trends, though facing pressure from rising input costs and changing consumer preferences.

Industry snapshot

Key public data points

Historical & forecast

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What does the Cafes & Coffee Shops in Australia industry cover?

The Cafes & Coffee Shops industry encompasses establishments primarily engaged in preparing and serving coffee, tea, light meals, and snacks in a casual dining environment. This includes independent cafes, chain coffee shops, and franchised operations that may also offer related retail products such as packaged coffee beans and merchandise.

• •Operates under ANZSIC code 5610 (Cafes and Coffee Shops)
• •Generated $6.8 billion in revenue in 2022-23 (ABS)
• •Employs approximately 130,000 people across Australia (ABS 2022-23)

Who operates in the industry and how is it structured?

The Australian cafe market is characterized by a mix of independent operators and national chains, with small businesses dominating the landscape. Major international players maintain significant market presence through extensive store networks, while numerous independent establishments cater to local preferences and specialty coffee trends.

• •Independent operators account for approximately 70% of industry establishments (industry sources alternative source)
• •Franchised operations represent about 30% of total industry revenue (Franchise Council of Australia)
• •The average cafe employs 8-10 full-time equivalent staff (Fair Work O)

What drives demand in the industry?

Consumer demand is primarily driven by the social nature of cafe culture, with Australians among the world's highest per capita coffee consumers. Changing lifestyles and remote work trends have increased cafe visits, while growing health consciousness has influenced menu offerings toward more nutritious options and plant-based alternatives.

• •Australians consume approximately 2.7 kg of coffee per capita annually (International Coffee Organization)
• •The take-away segment accounts for approximately 65% of cafe revenue (Coffee Association)
• •Gen Z and Millennials represent the primary customer demographic, driving specialty coffee trends

Who are the notable companies in the industry?

The competitive landscape features several major players, including international chains with substantial Australian operations and successful homegrown brands. These companies compete on factors such as location quality, product differentiation, pricing strategies, and customer experience, with premium positioning becoming increasingly important.

• •Starbucks Australia operates over 100 stores nationally
• •Gloria Jean's Coffees maintains a network of over 500 franchise locations
• •The Coffee Club is a major domestic player with 60+ company-owned and franchised outlets
• •Michel's Patisserie operates under the same parent company and has cafe offerings

What are the recent trends and outlook?

Recent trends include increased focus on sustainability with compostable packaging and ethical sourcing, the rise of 'experience cafes' incorporating workspace elements, and digital transformation through mobile ordering systems. The industry outlook remains cautiously positive with moderate growth expected, though operators face challenges including labor shortages and rising operational costs.

• •Approximately 40% of cafes have implemented digital ordering systems (Restaurant & Catering Australia)
• •The specialty coffee segment is growing at 5-7% annually (Coffee Industry Report)
• •Sustainability certifications have increased by 25% among cafe operators in the past three years

How is the industry regulated?

Cafe operators must comply with food safety regulations under the Food Standards Code, occupational health and safety requirements, liquor licensing (where applicable), and fair trading laws. The industry is also subject to minimum wage regulations, with recent increases in award rates impacting cost structures.

• •Food businesses must comply with the Food Standards Australia New Zealand Code (FSANZ)
• •The Hospitality Industry (General) Award 2020 sets minimum wage requirements for cafe staff
• •Food Safety Standards (Australia) Regulation 2021 governs hygiene and handling practices
• •All food businesses must be registered with their local state or territory health authority

Government, statistical and trade sources used for this Claight analysis.

• Australian Bureau of Statistics (ABS) Australian Industry 2022-23 ·
• Food Standards Australia New Zealand (FSANZ) ·
• Fair Work Ombudsman (Australia) ·
• International Coffee Organization ·
• Franchise Council of Australia