York Coffee Emporium, which has grown its turnover from £11,000 to £800,000 in five years, was bought by the vending machine supplier in an undisclosed deal.
The firm imports and hand-roasts coffees from around the world, and supplies retail customers throughout the UK, as well as sourcing and selling loose specialty teas.
Following the acquisition, co-owner of the York Coffee Emporium Laurence Beardmore will remain closely involved with the running of the firm, as well as taking on the role of commercial director for the Upton Group.
His wife, and fellow co-owner, Philippa Beardmore, will become operations manager at the York Coffee Emporium.
Remaining a standalone company, the addition of the York Coffee Emporium will see the Upton Group grow to a £6m turnover and increase employee numbers to 70.
Managing director of the Upton Group, Ross MacDonald, said: “This acquisition brings together two successful family businesses with a similar ethos to create a broader-based company which will benefit all our staff and current and prospective customers.
“As well as bringing a talented team and top-class products into the Upton Group, acquiring York Coffee Emporium takes a margin out of our business.
"Our annual turnover has risen by 16 per cent annually since 2012 but we now have 36% projected growth in 2016-2017.”
Beardmore added: “Both we and the Upton Group realised that it would make perfect sense for us to become a single entity and it was just a matter of timing.
“Our growth has been helped by the fact that customers, whether they are buying a drink in a hospital vending machine or from a café at a major tourist attraction, see themselves as coffee connoisseurs and expect the best.
“Becoming part of the Upton Group will allow us to go for bigger national clients and offer a wider range of services, training and technology and we are all excited by the opportunities it offers.”