Should I Try Crowdfunding
Sites like Kickstarter and Indiegogo have popularized crowd funding, and a few coffee shops have had success using those platforms. We caution against it because of how difficult it is to deliver rewards while youre opening. Managing a campaign is also incredibly time consuming during a period where your time is very precious. This is a recipe for upset backers and a bad reputation. A much better use of crowdfunding is for a specific event or addition once you are already open and have an established brand.
Get Insurance For Your Coffee Shop
You want to protect your coffee shop business and your employees. This includes general liability and workers’ comp insurance for starters. You will also want insurance that covers your equipment from theft or damage.
In every state, you will need to get workers compensation insurance. This will not only satisfy the requirements in your locale but also serve to protect you and your business assets from an accident.
Avoiding accidents will be important through hiring competent people, training, and developing best practices, but accidents do happen, so Worker’s Compensation is essential.
You should be proactive with your business about getting workers compensation insurance andgeneral liability insurance for your business. Not only is it the law, but it will help you sleep better at night.
However, dont take our word for it. Ask an insurance agent in your city to help you determine what is right for you and your café and check with your state’s Worker’s Comp agency.;
Read Through Application Materials
Look through your applications to see who stands out. Candidates who fill out every section of the application tend to be more detail-oriented and professional. You may want to choose candidates who have prior experience in the service industry. However, if you see potential in someone with little experience, you can start them in an entry-level role and give them the opportunity to grow with your business.;
Recommended Reading: Where Can I Buy Senseo Coffee Pods
Decide Whether You Want To Open Your Own Shop A Franchise Or Buy An Existing Business
When it comes to starting a business you usually have at least two ways to go about doing it, and with coffee shops, you’ve got three.When it comes to how to open a coffee shop you can do one of the following:
Completely start from scratch and open your own shop
Open a coffee shop franchise
Buy an existing coffee shop that’s for sale
Each of the options has its pros and cons and varying degrees of work required by you. If you choose to open a franchise you’ll be bound by many of the aspects of that franchise like the beans they use and the decor of the actual shop. If you buy another coffee shop you might have less construction to do to set up the space as a coffee shop. These options come with limitations as well.
Compare Your Coffee Shop Options
There are three basic options for starting a coffee shop:
- Purchase a franchise. To jump in with a built-in business model, you might consider a franchise, where most of the major business decisions will be made for you. For a fee, you will be provided with a turnkey business in a location selected by the provider of the franchise.
- 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.
- Start from scratch. Starting your own business from the ground up requires the most effort, but it also offers the most flexibility and the best potential to maximize profits.;
Whichever option you choose, the same fundamentals for success apply. Your business plan for starting a coffee shop should incorporate the following key factors.
Also Check: Can You Drink Coffee With Kidney Disease
Choose The Equipment For The Coffee Shop
As we already said, the easiest way to get the equipment is to rent a premise which already has it. But if not, you will have to choose one of the following ways:
Buying New Equipment. It can cost a lot, but you can try to save some money. Dont buy the equipment from the first producer explore the market and the prices first. Then, if you buy a lot, you can try to get at least a tiny discount.
Buying used equipment. Obviously, it will cost less than the brand new one. However, you will have to check the equipment wear. If the equipment is already at the last stage of its life cycle, it is better to spend more money but buy reliable equipment. Or you can choose the next option.
Getting equipment for free. Yes, it is possible but you will have to apply your diplomacy skills and be pretty lucky. This trick can work with foodstuffs suppliers if you sign a long-term contract with them, they can provide you with, for instance, their branded refrigerators.
Implement A Loyalty Program
Here is one more tip on how to run a coffee shop efficiently make up a special loyalty program for your visitors. It will motivate them to come back again and again, and this is exactly what you need, right? There are two popular variants of loyalty programs for coffee shops.
The first one is offering a constant discount to visitors who have already spent a certain amount of money in your place. The second option is developing a special system which will allow clients to collect bonuses and then exchange them for something cool. Both options are very popular, but at least you can create a really catchy design for discount cards.
To Franchise Or Not To Franchise
To give you an idea of the range of costs of buying into an existing franchise, listed below are various franchise costs . As you can see, many require a hefty financial commitment right from the start:
- Cost range to launch: $50.5K to $457K
Alternatively, you can simply open your own shop. This option is less expensive and gives you the flexibility to decide on everything in the store your business hours, what you sell, where you source your coffee beans, your décor, your prices, etc. Of course, you dont get the benefit of an established brand or a ready-made business plan. The trick is to be meticulous and realistic in your own business plan and budget to avoid overspending and make sure youre set up for success.
Find Professional Service Staff
To find reliable personnel, start developing portraits of your future workers. What should they look like? What qualities do they need? Then, create a catchy job description and publish it on job portals and social networks. Dont forget to prepare for interviewing your potential employees think about questions you want to ask them.
Remember that hiring the right people will be one of your biggest challenges. And as much effort you’ll have to put in retaining your employees. That is why it’s important to develop a nice motivation system with bonuses, extra days-off, lunches on the house, and so on. Besides, you will have to combine friendliness with more or less strict control. Otherwise, your employees may relax too much and spoil your business.
Explore A Coffee Shop Point
Every coffee shop needs a POS system, which is a modern-day cash register. Having a reliable coffee shop POS system is essential for your business transactions.
Choosing your Coffee Shop POS systemwill be an important decision to make on behalf of your coffee business.
Your Coffee Shop POS system can either make your life easier , or it can slowly bleed your bottom line.;
You may make your decision based on your choice of accounting software, ease-of-use and implementation, or fees associated with every transaction. Like the other recommendations, its always best to start early.
As the owner of the coffee business, you definitely have options. Ensuring its the right one for you will have an immediate impact. ;
We have an extensive review of the Coffee Shop POS System: ShopKeep.
Step #21 of How to Open a Coffee Shop:
Know Your Food Safety
As with any business where you will serve food and drink to the public, you need to be keenly aware of the relevant law. The Food Standards Agency , the government body that regulates food safety in the UK, produces the Safer Food, Better Business leaflet which contains key pointers on serving food, including cooking, cleaning, chilling, management, contamination and keeping a food diary.
You should also learn the Hazard Analysis Critical Control Point, or HACCP, which is an internationally-recognised method for identifying the most common food safety hazards in a preparation process.
And, once you’ve got your coffee shop idea off the ground, you will also need to make sure you have shop insurance to protect your business. Read our guide to shop insurance cover here.
For a detailed step-by-step guide on how to run a coffee shop and coffee shop ideas, read our comprehensive guide on;how to open a café.
We Discuss Coffee Shop Startup Costs In Greater Detail:
A large portion of these startup costs will go to the leasing or monthly rent, your build-out, and equipment. While it has been a retail industry standard that your rent should be no more than 15% of your sales, it is not always feasible. For example, if your rent is $10,000 a month, is it feasible that your monthly sales will be about $67,000?
Step #3 of How to Open a Coffee Shop
Pick Your Target Audience
Choose your target audience and cater your business to them. You can base this off of your location or what kind of business you want to run. For example, if your coffee shop is on a college campus, consider gearing it toward college-aged students. Along with your marketing efforts, make sure your interior design, menu items and company values align with the tastes of your target audience.;
Create A Business Name
The next item on your to-do list? Create a coffee shop name. While the options are endless, most states have rules when it comes to;how to name an LLC. A name must be unique. Most states have a searchable database on the secretary of states website to let you check.
If you plan to;LLC, most states require the name to contain limited liability company or LLC.
Before registering a name with the state, check for a matching domain name. Ideally, the company website and company name will match.
Promote The Heck Out Of Your Coffee Shop
Promoting your coffee shop business takes a lot of work. Opening a coffee shop or any coffee business requires a deep commitment, financial investment, time, and emotional and physical energy. It requires passion and excitement to maintain your momentum during the planning phase. Share your passion!
Without a doubt, plan your coffee shop’s grand opening and enjoy your journey!
We believe starting a coffee shop is a labor of love.
While money and profit may be part of the benefits of owning a coffee business, maintaining a successful business requires knowledge and planning. However, maintaining your passion and excitement about your business is also critical.;
We aim to help you process your thoughts and ideas in a manner that allows you to better plan and execute your coffee business strategy.
Take your time and be methodical about checking off the items on this list. By working on an item on this list every day, you’ll be closer to achieving your goal.
Classic Coffee Drinks You Can Make At Home
Cappuccino: For this, you’ll need 1-2 shots of espresso and 4 oz. fresh whole milk. You can use an espresso machine or a manual espresso maker, or the Aeropress method. The idea with a cappuccino is that it’s equal parts espresso, steamed milk, and milk foam.
Cold Brew: This will give you a boost of energy, that’s for sure. Grind 1 cup of whole coffee beans to a coarse cornmeal consistency. Add the coffee grounds to a 1-1/2 glass container, then add 4 cups of water and stir gently. Cover and let it steep overnight. Line a small strainer with cheesecloth and place over a bowl. Pour the coffee through the strainer. Transfer the coffee to a small bottle or jar and store in the fridge for up to a week!
“Au lait” is French for “with milk,” so cafÃ© au lait is not much more complicated than that. It’s coffee with hot milk. You could even use your regular old coffee maker for this one.
Flat White: This is 1 shot of espresso, 2 shots of steamed milk, and a little micro-foam.
Caffe Latte: 1 shot espresso, 2 parts steamed milk, 1 part milk foam. Lattes are laid back, dependable, and simple joys of life.
Macchiato: This is 1 shot of espresso and a dash of steamed or hot milk. It gets the job done without overpowering the espresso flavor.
Equipment Utilities And Supplies
Here, we outline the equipment, utilities and supplies youll need to start your own coffee shop. Well also look at the process of sourcing equipment, utilities, and suppliers.
Opening a café or coffee shop requires a lot of equipment. Some of it youll need straightaway, while other items you may be able to get further down the line, depending on your business requirements.
Essential kit includes:
- Coffee makers espresso machines, as well as drip and cafétieres, plus equipment for any other specific drinks you offer e.g. pour over/filter
- Coffee grinders ensure these are suitable for commercial use
- Cooking devices e.g. ovens, toasters, sandwich presses
- Cooling and storage e.g. refrigerators, freezers, shelving/cupboards
- Food containers for syrup, ingredients, milk etc.
- Security devices e.g. alarms, CCTV cameras, water detectors;
- Payment equipment this includes a card reader, an iPad and/or a till, plus software. For more information on payment equipment, read our guide on small business POS systems
You can choose to buy some items outright from the beginning, or you can hire them on a rental or lease basis. For example, espresso machines are notoriously expensive, and it may be more sensible to rent one. By contrast, food containers are likely to be cheaper to purchase.;
Create A Timeline To Open Your Coffee Shop
Develop a timeline for starting your coffee shop development. As with all business planning efforts, establishing goals and benchmarks tied to an approximate timeline or calendar will be important to your strategic planning. Having a timeline will also help push yourself to get started and keep you motivated.;
Figuring out which items still need to be completed should be written somewhere on a calendar.
Having a timeline will help propel you to start your coffee business more effectively and efficiently. We recommend giving yourself an end goal and work backward.
Be realistic. Balance your timeline to put a little pressure on yourself but not so much that you get overwhelmed and paralyzed. Start small, but start.
If you are consistent and work every day on a strategy that you put together in a business plan, you will start seeing progress quickly.
Step #28 of How to Open a Coffee Shop:
Start Marketing Before You Open
A busy first day will help you put your best step forward as you kick things off. One crucial element of a coffee shops success is the buzz you generate before you open. Youll naturally pick up some interest in your business during renovations. A simple coming soon sign with your logo outside your new space will get your neighborhood excited about your new cafe.
You can also generate some awareness for your local business with a strong local network. Your chamber of commerce and business association will help you establish a connection to your city or town. You can also make appearances at some local events, where you give out samples and coupons for your opening day. Drop off some free coffee and flyers at businesses in your vicinity, and dont forget to tell local news outlets about your new business. Build a social media presence and design a website, too.
Dont Just Focus On The Interior Of The Building
Its likely that youll stress over every little detail of your shop, from what paintings to hang on the wall to the point of sale system youll use. That being said, it can be very easy to ignore the exterior of your shop or coffee cart which directly contrasts with choosing a location with heavy foot traffic.;
According to Wilson, youll want to pay attention to the landscaping, signage, and exterior appearance because thats the first thing people see. Some people decide whether or not to come in based on their first impression of the building, so make it count.
A Few Things To Consider Before You Start A Coffee Shop
Next, you need to make difficult decisions about how to get your coffee business up and running.
There are a few different options to consider when it comes to deciding on your coffee shop concept:
- Purchase a coffee shop franchise: This is the right option for you if youd prefer to buy an existing business with an established model. As opposed to your own coffee shop, many of the business decisions will be made for you.
- Buy an existing coffee shop: In this instance, you would be investing in an existing coffee shop that is for sale. This can be a great opportunity to revamp the premises and put the coffee shop on the map. However, finding an established coffee shop with a solid business plan and in the right location can be challenging.
- Start your own coffee business: Arguably, this option will require the most effort and startup costs. On the other hand, this option provides the most flexibility and you would have complete control over your coffee shop business plan.
If you decide that being a business owner is for you, there are also a few different types of coffee businesses you can open.
Here are a couple of coffee business ideas:
- Coffee kiosk at local events
- Coffee roaster
Now you need to take steps to decide where your new coffee business will be located, what you will offer on the menu, whether you will run the business or hire someone else, and how you will attract regular customers and foot traffic.