5 days ago

The Death of the Traditional Café. With Raihaan Esat

In this thought-provoking discussion, hospitality veterans Phil Di Bella and Raihaan Esat dive deep into the evolution—and possible extinction—of the traditional café. They trace the journey from café culture’s golden age to today’s high-cost, low-margin reality, uncovering the harsh truths behind shrinking profits, rising expectations, and the impact of automation. This is a must-listen for café owners, coffee lovers, and anyone invested in the future of hospitality.

 

Key Topics & Themes:

  • The evolution of Australian café culture from the 1990s to 2025

  • Why prices haven’t kept up with rising costs—and what it means for café profitability

  • The “magic triangle” of speed, quality, and price—and why you can’t have all three

  • The rise of automation: threat or opportunity?

  • How consumer habits are shifting from daily visits to at-home consumption

  • The future of cafés: hyper-convenience vs. curated experiences

  • Why community and customer engagement are more important than ever

 

Time-Stamped Highlights:

  • 00:00 – Intro to the show and guest Raihaan Esat

  • 02:00 – What cafés were like in 1993 vs. 2007

  • 05:00 – Coffee pricing, wage growth, and the shrinking profit margin

  • 10:00 – From grab-and-go muffins to the bistro café boom

  • 14:00 – The café model today: espresso bars, cafés, and specialty diners

  • 19:00 – Why automation is growing—and how it fits into the café ecosystem

  • 25:00 – The role of baristas in an automated world

  • 27:00 – The cost of customisation: milk alternatives and their hidden overhead

  • 30:00 – Future predictions: home machines, hyper-convenience, and destination cafés

  • 34:00 – Global coffee demand vs. production – and what it means for future pricing

  • 39:00 – Final thoughts: why every café must find their “one thing”

 

About Our Guest:

Raihaan Esat is General Manager at International Coffee Traders and a shareholder in the Coffee Commune. A Hall of Fame recipient with over 15 years in the industry, Raihaan brings a unique perspective on retail, roasting, and international sourcing. His insights into the economics of coffee are rooted in real-world experience and deep sector knowledge.

Connect with Raihaan on LinkedIn

Visit Coffee Commune

 

Takeaways:

  • Cafés today are operating with just 5–10% profit margins, down from 30–35% in the 1990s.

  • Automation can improve efficiency, but it must complement—not replace—customer service.

  • Café success now hinges on offering a distinct experience or being hyper-convenient—there’s little room for in-between.

  • The price of coffee beans is rising due to global demand outpacing supply—prices at the cup level are likely to surge.

  • The café of the future must lean into its “one thing” to stand out—whether it’s product, service, or experience.

 

Links and Resources:

 

Listen now on your favourite podcast platform.

 

Produced by The Podcast Boss

The Coffee Commune

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