Chapter 1: Executive Summary Office Coffee Service Market Size and Forecast Office Coffee Service Macroeconomic Drivers

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Chapter 1: Executive Summary Scope and Methodology Scope of coverage Methodology Consumer survey methodology Market size and forecast Menu item trend analysis Other sources Restaurant categories Limited-service restaurant definitions Full-service restaurant definitions Other definitions Office Coffee Service Market Size and Forecast Office Coffee Service Macroeconomic Drivers Consumer Trends Shaping Office Coffee Service Coffee Foodservice Menu Trends Consumer Coffee and Office Coffee Usage & Behavior Office Coffee Service Provider Analysis Chapter 2: Office Coffee Service Market Size and Forecast Market size and forecast summary Moderate growth ahead But competition looms Pursuing smaller accounts is paramount Consumer purchase patterns a wildcard Bottom line Graph 2-1: Office Coffee Service Revenue, 2005-2014 Largest sales category? Coffee, naturally Graph 2-1: Office Coffee Service Revenue, Dollar Share by Product Category, 2005-2011 Branded coffee makes a comeback Table 2-1: Office Coffee Service Revenue, Percent Share by Product Category, 2005-2011 Industry segment analysis Table 2-2: Office Coffee Service Accounts, by Industry Served, 2005-2011 Chapter 3: Office Coffee Service Macroeconomic Drivers Overview Macroeconomic trends: our take Economic forecast through 2014 GDP: A long time getting back, but finally passes pre-recession levels Forecast factors

Graph 3-1: Unemployment, GDP & Inflation Forecast, 2011-2014 Consumer confidence remains abysmal but is rising from bottom Graph 3-2: Unemployment Rate, Savings Rate & Consumer Confidence, 2007-2012 Unemployment remains high but is tapering downward Demographic analysis Trouble areas Table 3-1: Unemployment Trends, by Demographic, October 2009 to December 2011 Consumer spending trends Consumer spending ticks upward Inflation-adjusted foodservice & accommodations consumer spending up 4% since 2005 Coffee price outlook Commodity coffee prices coming back down to earth? Graph 3-3: Monthly & Annual Coffee Price Trends: 2001-2011 PPI for coffee Graph 3-4: Producer Price Index: Coffee, 2007-2011 PPI industry index follows commodity trends Graph 3-5: Producer Price Index: Coffee and Tea Manufacturing, 2007-2011 Translation: higher coffee and coffee drink menu prices Table 3-2: Average Increase in Price of Coffee and Drinks, by Beverage Type, 2007-2011 Retail price trends Graph 3-6: Consumer Price Index: Coffee, 2007-2011 Coffee imports: volume flat; value on the rise Increase in coffee sales highly influenced by cost per ton, not volume increases Table 3-3: Coffee Imports, by Product Type Value, 2006-2010 Table 3-4: Coffee Imports, by Product Type Volume, 2006-2010 Table 3-5: Coffee Imports, U.S. Dollars per Ton, by Product Type, 2006-2010 Chapter 4: Consumer Trends Shaping Office Coffee Service Overview Opportunity: morale, retention and productivity Coffee does helps employees through the workday at least employees think so Employees view coffee as productivity tool For many, high-quality office coffee is an important workplace perk Rise of the K-Cup The office coffee pot is still king but for how long? Pods/K-cups closing gap; office usage significantly influenced by personal purchases Table 4-1: Office Coffee Service Single Cup Brewer Placements: Manufacturer Share, 2005-11 Consumer K-cup purchases encroach on office coffee service territory It s going to get worse fast Dunkin Donuts Starbucks Tripling household penetration within 5 years? Opportunity: move beyond coffee Water filtration Office and cleaning supplies Specialty coffee & tea growth

Mainstreaming is at hand Shift away from carbonated beverages Opportunity and challenge: tapping into breakfast 142 million opportunities to sell coffee every morning: but office coffee service loses out Pre-work coffee drinking siphons away workplace drinking Challenge: the VIA effect Starbucks VIA revitalizes instant; threatens office coffee VIA raises instant coffee quality bar The Via Effect Challenge: virtual workspace trend Off-site-only employment reaches 16% in 2009 Percentage of employed working only at home surges Table 4-2: Employed Persons* Working At Home, At Workplace, and Away From Workplace, Time Spent Working At Locations, 2003-2009 Office coffee service vulnerability Continued growth in remote employment expected Opportunity: tap into wellness A trend on the rise Table 4-3: Wellness Program Benefit Access, 2000-2010 Healthy food promotion policies nearing majority status Tea provides health and wellness halo Tea s healthful properties a hit with consumers Table 4-4: Consumer Beverages Purchased for Nutritional Benefits, 2011 Table 4-5: Tea Types Purchased in Last 12 months: Health Significance, 2011 Challenge: Restaurant options beckon offsite Familiarity and ease of use drive restaurant decision Convenience is King Among restaurants, convenience comes in many forms For employees, what does it mean? Restaurant density analysis provides insight As urban as it gets: Aon Corporation 400 restaurant choices! A giant in Rural America: Tyson Foods Setting up shop on the suburban fringe: General Motors Suburban sprawls: Baxter International, Allstate and Why it matters Table 4-6: Restaurant Selection Density, Selected Fortune 500 Locations Challenge: healthy coffeehouse and coffee-centric QSR chain performance Same-store sales comparisons Reading the graphs One-year and multi-year comparisons Coffeehouses ride positive sales wave Graph 4-1: Coffeehouse and Donut Shop Restaurant Annual Same-Store Sales Index: 2005-10, 2006-10, 2007-10 & 2008-10 Positive segment momentum through 2011 Graph 4-2: Coffeehouse and Donut Shop Restaurant Quarterly Same-Store Sales Index:

2008-11, 2009-11 & 2010-11 QSR coffee players: coffee is big business McDonald s: the behemoth grows while others falter Graph 4-3: QSR Coffee-Centric Restaurant Annual Same-Store Sales Index: 2005-10, 2006-10, 2007-10 & 2008-10 Mixed momentum through 2011 Graph 4-4: QSR Coffee-Centric Restaurant Quarterly Same-Store Sales Index: 2005-10, 2006-10, 2007-10 & 2008-10 Chapter 5: Coffee Foodservice Menu Trends Overview Datassential Coffee varieties Table 5-1: Top Coffee Varieties, Restaurant Penetration, by Segment, 2011 Restaurant penetration increases Table 5-2: Top Coffee Varieties, Restaurant Penetration, by Segment, 2007-2011 Coffee flavors and types Table 5-3: Top Coffee Flavors/Types, Restaurant Incidence, by Segment, 2011 Chapter 6: Consumer Coffee and Office Coffee Usage & Behavior Summary Analysis: Coffee Mature usage dictates need for expanding varieties & usage occasions The Via Effect Single-brew/instant innovation cannibalizing ground/whole bean coffee? Coffee conversion opportunities 143 million opportunities to sell coffee every morning But office coffee service faces first cup dilemma Weakness: Drive-thru Competing on price and customized programs are keys to success Coffee usage holds steady through recession Table 6-1: Coffee Usage Trending, 2008-2011 Coffee drinks, espresso/cappuccino and instant coffee Coffee drinks, espresso/cappuccino and instant coffee Note on reading charts on this section Instant coffee gaining traction among higher-income households Espresso/cappuccino an important racial/ethnic distinction; usage trends are afoot Table 6-2: Coffee Drinks, Espresso/Cappuccino and Instant Coffee Usage Trending, 2008-2011 Instant coffee & instant flavored coffee Usage upswing among black consumers Table 6-3: Instant Coffee & Instant Flavored Coffee Usage Trending, 2008-2011 Ground and whole bean coffee: suffering at the hands of single-brew? Table 6-4: Ground and Whole Bean Coffee Usage Trending, 2008-2011 Framing foodservice coffee drinking trends: coffee drinkers Usage baseline: 183 million adult coffee consumers Age gap exists but is gap narrower?

Relevance to Hispanic and Asian consumers Table 6-5: Coffee Drinkers, Selected Demographics, 2011 Daily coffee consumption frequency At least 240 million opportunities to sell coffee per day Table 6-6: Daily Coffee Consumption Frequency, Selected Demographics, 2011 Coffee drinking by daypart 142 million opportunities to sell coffee every morning Table 6-7: Coffee Drinking by Daypart, 2011 Coffee Procurement in Past 7 Days, by Method/Location Coffee relevance rises among full-time employed Coffee procurement methods among the employed Before work versus during work A toss up: Bringing coffee versus making coffee On-the-go importance Table 6-8: Coffee Procurement in Past 7 Days, by Method/Location: Full-Time Employed Consumers, 2011 Feeding the habit: usage frequency Table 6-9: Coffee Procurement Method/Location in Past 7 Days: Full-Time Employed Consumers, by Coffee Usage Frequency, 2011 Generational analysis Table 6-10: Coffee Procurement Method/Location in Past 7 Days: Full-Time Employed Consumers, by Generation, 2011 HH income analysis Table 6-11: Coffee Procurement Method/Location in Past 7 Days: Full-Time Employed Consumers, by Coffee Usage Frequency, 2011 The office coffee pot remains king for now Pods/K-cups closing gap; office usage significantly influenced by personal purchases Table 6-12: Coffee Types/Methods Used by Consumers Drinking Coffee at Work, 2011 Coffee usage frequency significantly influences office coffee procurement choice Pods/k-cups may pose price barrier for frequent coffee drinkers Table 6-13: Coffee Types/Methods Used by Consumers Drinking Coffee at Work, by Coffee Usage Frequency, 2011 Generational differences Table 6-14: Coffee Types/Methods Used by Consumers Drinking Coffee at Work, by Generation, 2011 Coffee pods/k-cups: urban office usage emphasis Table 6-15: Coffee Types/Methods Used by Consumers Drinking Coffee at Work: Urban/Outer Suburbs/Rural, 2011 Satisfaction with office coffee procurement methods Free vending on top? Table 6-16: Satisfaction with Coffee Types/Methods Provided by Employer, 2011 Coffee helps them through the workday Table 6-17: Coffee Helps Keep Me Productive Through The Workday, Selected Demographics, 2011 For many, high-quality coffee is an important workplace perk

Table 6-18: Coffee Helps Keep Me Productive Through The Workday, Selected Demographics, 2011 Aramark Corp Foodservice operations Chapter 7: Office Coffee Service Provider Analysis Sales analysis North America Education Sector North America Health Care Sector North America Business and Industry Sector Vending & Office Refreshments Operations Filterfresh acquisition Waste-to-Energy and Terracycle sustainability initiatives Small business service innovation Giving clients choices Equipment upgrades help drive bottom line On-Site Foodservice Event Catering Strategy: Workplace Productivity, Value-Added Services, Contract Design Workplace Productivity Value-Added Services Contract Design Table 7-1: Aramark by the Numbers Compass Group PLC Compass Group North America (CGNA) Sales analysis Foodservice strategy Room for growth It Takes You - Eat Local Leveraging role of single-source provider North America Business & Industry Sector Corporate Dining Premium/Executive Dining Catering and Event Services Vending and Refreshment Canteen Office Coffee Service The Starbucks connection Canteen s aggressive acquisition path Coffee Distributing Corp brings strong northeast office presence Strategy Focused Promotions and Value Offerings Kimco & Cross-Selling Table 7-2: Compass Group by the Numbers Farmer Bros. Co. Acquisition-based growth Business operations

Office Coffee Service: Custom Coffee Plan Sales performance Table 7-3: Farmer Bros. by the Numbers Green Mountain Coffee Roasters, Inc. Growth strategy A beverage for every occasion pushing beyond coffee Penetrating away-from-home venues K-Cup branding reach Expanding its own foodservice & retail coffee brands Tully s Timothy's Coffees of the World Diedrich Coffee Roasters Tea branding Other beverages Table 7-4: Green Mountain Coffee, Tea and Other K-Cup Brands, 2011 Coffee makers & accessories leader Significant business relationships with coffeehouse giants Dunkin Donuts Starbucks Lavazza Filtered coffee machine in the works Operating segments Sales performance Segment sales Table 7-5: Green Mountain Coffee Roasters, Selected Metrics, 2007-11 Peet s Coffee and Tea Coffee & tea types and blends Growth strategy California base Geographic expansion Thwarted acquisition crimps single cup presence Distribution channels Retail stores Grocery: strong growth Home delivery Foodservice and office Office Coffee Sales performance Business segments Business categories Historical summary Q3 2011 Table 7-6: Peet s Coffee and Tea, Selected Metrics, 2007-11 Royal Cup Coffee Office Beverages On the office menu Table 7-7: Royal Cup Coffee, Coffee Offerings

Marketing & promotional activity Sales performance Sodexo Inc Education Foodservice North American Health Care Corporate Foodservice North American Corporate Foodservice North American Corporate Foodservice Strategy: Sustainability, Celebrity Chef Partnerships, Employee Health Employee Health Celebrity Chef Partnerships Sustainability Work/Life Balance Cafes, Retail Brands Catering Office Refreshment Recent initiatives Table 7-8: Sodexo by the Numbers