What Will Happen to Second Cup in Mississauga?


Published October 31, 2016 at 9:30 pm


If you’re a big fan of coffee chain Second Cup, we have some bad news for you–the struggling brand doesn’t appear to be doing very well.

According to a recent Canadian Press article, the company says it has created a special committee to “review its strategic options.”

The CP reports that prior to establishing the committee, Second Cup said it was pursuing options to refinance its debt. The article added that “such strategic reviews by companies often result in a sale or other major transaction.”

While the news isn’t good–especially for all those Mississauga-based Second Cup fans who love to hang out in the spacious location on the ground floor of the Capital Condos in City Centre–it’s not unexpected.

Second Cup hasn’t quite thrived the way Starbucks has. According to the CP, the company reported a net loss of $75,000 for the third quarter ending Sept. 24. Revenues are also down to $7.7 million from about $9.3 million in the same quarter last year.

The numbers are indeed disappointing, especially since Second Cup hasn’t fallen behind for lack of trying.

In the summer of 2015, The Toronto Star ran an engaging piece about Second Cup CEO Alix Box’s valient attempt to revive the ailing chain.

According to the article, Box revitalized the brand by re-imagining it as “Canada’s go-to specialty coffee retailer.” In order to breathe new life into the company, she attempted to make it more–not less–upscale.

Box told The Star that she was planning to streamline the brand’s look across locations and make the overall appearance less “down market.”

Awhile back, the company launched its more sophisticated look in its King. St. W. entertainment district location in Toronto and, according to The Star, incorporated “more modern signage” and wireless smartphone chargers.

The rebrand was risky, but ultimately made sense. With more people gravitating to boutique and high-end cafes, the move to scale up rather than down appeared to be a novel one.

That said, it appears the brand is still struggling to keep up with competitors.

To give some context, the CP reports that rival Starbucks had 1,378 locations at the end of its third quarter on June 26 compared with 1,348 locations at the end of the same quarter last year. Second Cup closed six locations in its most recent quarter, leaving it with 298 franchised and company-owned stores in Canada. In the same quarter last year, the store had 327 locations across the country.

It’ll be interesting (and perhaps disheartening) to see what happens to the homegrown brand.

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