So you’ve had this dream of opening a coffee shop? You are a bit scared as your friends and family have told you not leave your cushy corporate job for entrepreneurship! Well, we hope this will help you just a little bit to make your decision a bit easier.
Opening a coffee shop can be extremely profitable – if you do it right that is. Today, the coffee shop has become the new market place for people across the world, it is a safe place for mom’s waiting for their kids after school, a library for students who are writing exams and a meeting place for other entrepreneurs like you. This all depends on your location, the types of coffee your serve and added extras like free wi-fi to service your customers.
Coffee shops have become big business, with large chains such as Vida e Caffe, Seattle Coffee Company and Mugg and Bean making massive investments to serve South Africans with their daily cup of java. The investment drive in this sector hasn’t stopped, with Starbucks and other stores like Krispy Kreme growing their footprint extensively as they see opportunities in targeting our youth. So this tells you, that there definitely potential within the industry.
The most important part about making your business a success comes down to one thing! Your passion. If you love coffee and are looking for a business opportunity, please continue reading this.
Your business model is important and you should take your time in ensuring you clearly understand your options. If you don’t understand how to start a business, get an accountant and lawyer involved early. There are three simple models for starting a coffee shop for you to consider:
Purchase a franchise – Starting a business from scratch can be extremely time consuming. Setting up processes, supplier negotiations etc is a complex process and comes with time. Becoming a franchisee allows you to buy in to an existing business in a box allowing you to get up and go from day one. There are some downsides like royalty and franchise fees, as well as set-up costs, but if the business model fits your coffee shop, this may be an easy entry to the market.
Buy an existing business – Investing in a shop that is for sale or in need of a revamp is another way to acquire a turnkey operation. However, finding a profitable business for sale is no easy task, its important that your accountant supports you in your due diligence to ensure that you aren’t buying a business which isn’t viable.
Start it Up yourself- Starting your own business from the ground up requires the most effort, but it also allows you to do it your way and your way, may just be the new way.
Whichever option you choose, the same fundamentals for success apply as with any business. Ensure your business plan for starting a coffee shop incorporates the some of the following key factors which may make you stand out from the rest.
Your location is imperative!
Ensuring your shop is in the right location is important this defines the type of customer you intend to service. Cycling and coffee have a symbiotic relationship for example. Having a secure lock-up rack for bikes in front of your coffee shop is essential.
Serve a High-Quality Product
When opening a coffee shop, consider that gourmet coffee and tea drinkers want more than a mug of ordinary joe or a teabag in a foam cup. In South Africa, with our summers are also suited for a more cooler drink and our younger generation like the look of walking in the mall with a freezo. No matter how the product looks, quality of taste will push you over the top to gain that market share. Make sure your coffee has a consistently high coffee grade and full of taste. You may want to look at companies like Java Roasted Coffee to give you a blend to keep those customers rolling through the door.
Create a Trendy, Relaxing Café Atmosphere
When opening a coffee shop, having the right atmosphere is key to attracting customers. Surveys have shown that most consumers cite comfort, familiarity, and overall atmosphere as the primary attractions for a coffee shop. Look at your competitors., especially those setting world class standards which gets customers wanting to tell their friends to visit so that they can post these instagrammable coffee shops on their gram.
The ideal atmosphere is clean and bright with plenty of natural light and comfortable seating space. Use a mix of seating and table types so you can accommodate single customers as well as groups of various sizes. Having an outdoor patio space is a huge attraction in warmer seasons, and greatly increases the visibility of your business.
Unless you have some designing experience, consider hiring a professional interior decorator to handle layout, furniture, flooring, etc. You want a distinctive, personalized ambiance that will draw in customers.
Have a great supporting cast
Another key to success when planning how to start a coffee shop is to realize that, even though coffee and tea have a high markup, a coffee shop cannot survive on coffee sales alone. Most successful food service and retail establishments know to diversify their offerings. Make sure your meals, snacks or cakes compliment your coffee and is a great supporting cast.
Having an assortment of quality snacks on display at the counter will tempt your customers to make an additional purchase. Most bakery items pair well with coffee, but to further define your brand and increase sales, you may want to think beyond the typical muffins and pastries. Is there a local bakery or sandwich shop you can partner with? Many customers are eager to support small businesses, and baked goods can often be sourced wholesale from local bakeries.
There are many areas to look at when starting a coffee shop. Get creative but also ensure that the basics on quality and customer service are at the forefront of your new venture. That’s all from us! Now get out there and do it. Your country needs you!
Subscribe to our newsletter for weekly coffee articles
