Are coffee shops actually viable?

[Pot Bellied Fool]

tumble dryer said:

Averaging 40 cups of coffee per day, every day, from a small outlet with low expected footfall is doing VERY well.

I'll have around 200 clients that I supply (mostly rent) coffee machinery to and less than 25% of them achieve that figure.

Thanks for that Mr Tumble, really interesting insights - I'd have thought 40 was easily do-able - particularly if just off the High St - but clearly my coffee skills are limited to drinking the stuff!

[Pot Bellied Fool]

As I sit here waiting for the kettle to boil - it's clear my ideas of how many cups of coffee can be served are way off after some industry insights - she needs to think about how to build a community. Maybe kit it out as a co-working space or attract groups like Jelly networking & similar, but it sounds like the venue is probably a bit small.

She needs to find something as her USP and also to boost the average spend/profit per customer whilst avoiding coffee-shop workers who'll sit there for a morning & only buy one coffee...

I quite liked the Ziferblat pay-per-minute model, https://www.ziferblatuk.co.uk/, used to be one I used in Liverpool but it closed down in a dispute over rent.

[singlecoil]

It must be borne in mind that coffee shops frequently sell tea as well. And cakes. And toasties. And other stuff.

[citizensm1th]

singlecoil said:

It must be borne in mind that coffee shops frequently sell tea as well. And cakes. And toasties. And other stuff.

Even more other stuff if you brand yourself as a Dutch café ja?

[anonymous-user]

sideways sid said:

- better still, take a job in one of them and learn how the business works

This.

It's relatively rare for a successful business to not have roots in some kind of employment experience. Even a trial shift would be useful.

Edited by anonymous-user on Wednesday 18th December 11:15

[theguvernor15]

singlecoil said:

It must be borne in mind that coffee shops frequently sell tea as well. And cakes. And toasties. And other stuff.

Spot on....

I don't think many would survive 'just' selling coffee, variety, ice coffees/teas/hot chocolates/smoothies etc.

Plus a few cakes/simple dishes, keep it simple, i'll use Costa as an example, but anything they cook either goes in a high speed oven or a contact grill (toasties etc.) It takes about 2 minutes or so to produce any hot item of food they sell.
They're slightly different as they're delivered to site pre-made, so it's very simply, open the packet, bang it on/in, then onto a plate.

But there's no reason why your friend couldn't make a load of pre-made panini's, display them, then cook them on order.
Very simple, very quick.

[GOATever]

And bear in mind, that should someone pop a big brand franchise right next to you, unless you have a very good USP, that’s pretty much going to be game over. ‘Themed’ places can fare well, but the marketing has to be on point. Targeting social media groups, which are to do with your chosen ‘theme’ for example, and trying not to make that theme so niche, that you’ll never get the numbers you need. The ability to up sell, is crucial as well. Get a line of something that can be made for pence, tarted up easily and cheaply, and sold for a healthy mark up ( think bespoke cup cakes, or the drinks themselves for example ). And make sure you try and up sell whenever a customer orders a drink.

Edited by GOATever on Wednesday 18th December 13:04

[TCS1]

Might be stating the obvious here but a coffee shop must have...good coffee. There's so many coffee shops now, costa/starbucks have their model - the coffee is what it is and the independents are more or less the same with a creating relaxing environment, cakes, pastries, lunches etc. I return to the places that make a good cup of coffee and it's night and day between these plays and the coffee you'd get from Starbucks. Certainly not a business to jump into without a proper foundation of skill/knowledge.

Edited by TCS1 on Wednesday 18th December 14:20

[sparkyb999]

My idea for a decent coffee shop was to make it Cyclist, Motorbike & car group friendly and boom.. cash will roll in.

Fill it with decent cake & coffee, provide decent clean toilets, decent parking and areas to rest up bicycles.

In the bucks/oxon area, there are very few decent cafes with room that caters for this type. If you can base it like the waterfront café in Benson, this café has a good network of country roads making it a good cyclist route, it has enough parking for motorbikes. If it had more parking for cars it would be perfect.

[technodup]

StevieBee said:

I camped out in one (Costa) for a day a few years back doing interviews. In between which and during the usual no-shows, I watched the operation. This was a busy city centre (Canterbury) with two tills operating. Rough average I counted was that each till rang 4 times every minute with an average order value of a fiver. That's takings of £20 every 60 seconds - £14k a day

A sale every 15 seconds? Value of a fiver? So two coffees or so? Even to pour them from a jug would take longer, never mind ringing it up and giving change etc.

I've never drunk a cup of coffee but I've seen the performance that goes into making it in these places and it takes way longer than 15 seconds. And even if you had one person permanently on the till the others doing the making/serving would be bottlenecked.

[Mandarin VX]

Evening all!
So we've been progressing the idea, working through the numbers.

As stated previously the 40-a-day figure is realistic for a small independent cafe, as depressing as that sounds, it may well be the truth, lets call it a baseline.
This location isn't on a busy highstreet, its off the main drag so visitors will need to intentionally aim for it, which is fine once established as a "destination" rather than "lets nip into this generic big brand shop for an overpriced coffee" on the way past.
Its strong points are that it's in a quiet area, family/kids friendly, has an actual garden with grass and a tree, so in summer would be 10x more attractive to a lot of people that really want to sit down and enjoy a coffee than the soul-less generic costabucks. Its just getting them in, and getting established regulars.

Going back to the rent etc, it turns out the ad was wrong.... sigh, its £560 a month but its worth it we think, its just a matter of making the business pay for it.
We've estimated fit-out at circa £6k with some savings from used equipment initially.
we're viewing it this weekend.

I seem to have been sucked into this don't I...!!!!!!!!!

As for turover, of course it cant only be based on coffee sales, so we need to figure out a menu and other drinks, and other added value things to do.

Lots of interest from local arts groups too, but they may be the types to fill the place for 4 hours and only buy 1 drink/cake each....

[anonymous-user]

You won't make much money but don't let that put you off if its the life you want.

Have you considered a trial shift in a similar cafe to get the gist of the day to day? In best case scenario, you will be doing every job more often you might expect. Staff get ill etc.

[citizensm1th]

you need a usp, how about a kids play area outside in the summer and a kids drawing/art area inside for the winter?

other than that you need to do the best cakes in the area something to tempt the yummy mommies to go out of the way to get to you

[Mandarin VX]

Sambucket said:

You won't make much money but don't let that put you off if its the life you want.

Have you considered a trial shift in a similar cafe to get the gist of the day to day? In best case scenario, you will be doing every job more often you might expect. Staff get ill etc.

Its not me, I'm just the friend in this, were viewing the place on saturday, so will be discussing options/ideas etc

[Mandarin VX]

citizensm1th said:

you need a usp, how about a kids play area outside in the summer and a kids drawing/art area inside for the winter?

other than that you need to do the best cakes in the area something to tempt the yummy mommies to go out of the way to get to you

Not really enough space for either of those, but yes, needs a USP, and I think that might be it's location/quietness (which kids will quickly destroy but hey..!)

yes, cakes, scones, toasties, "cream teas" all that shebang...

[tumble dryer]

Mandarin VX said:

citizensm1th said:

you need a usp, how about a kids play area outside in the summer and a kids drawing/art area inside for the winter?

other than that you need to do the best cakes in the area something to tempt the yummy mommies to go out of the way to get to you

Not really enough space for either of those, but yes, needs a USP, and I think that might be it's location/quietness (which kids will quickly destroy but hey..!)

yes, cakes, scones, toasties, "cream teas" all that shebang...

Footfall.

Whichever strategy your friend chooses, consider and invest in the continuity of footfall.

Getting people through her door will ultimately determine her success.

[Cheib]

The most successful coffee ship I know is run by a couple who started selling coffee out of a small van and then got offered some space by a local business. Tiny shop with room for four people sitting on stools and maybe 15 people can sit outside. They have really good footfall and make all their own muffins/savouries etc and offer crepes. My guess is they would do s few hundred cups a day on a busy weekend day. They opened a second shop about a mile away with better inside space but nowhere near as good location wise....that last less than 18 months.

[Thankyou4calling]

The key to the success of this venture can be summed up in one word:

LOCATION LOCATION LOCATION

Is that one word?

Get that right and nothing much else matters. Service, USP, art groups, coffee taste, fresh muffins. All are inconsequential to location.

Get that right you’ll thrive, get it wrong and it won’t last.

On the little bit you’ve said I’m afraid it doesn’t sound like a great location.

If you think having amazing coffee and incredible service will get people to walk or find you off the main road I’m afraid it won’t.

[anonymous-user]

I agree - the location sounds like a massive obstacle to overcome. It's false economy to skimp on rent for a business that relies on footfall.

Speciality offerings are expensive to market in their own way and unlikely to offer better returns than more rent spent on location.

[GOATever]

Get your strategy right, and stick to it. If you choose the ‘stack it high sell it cheap’ type of model, you can reduce your bottom line, by economy of scale ( you buy lots of coffee / whatever else you sell, it’s cheaper) this relies on sales / footfall / through put, being sufficient. Personally I believe in the old adage that ‘no one wants to be the busy fool’ and I would rather go for a more marketing focussed/ driven, sell less, but do something that allows the top line to be higher, and get your marketing right. Both strategies have their own risks, but I’m personally more comfortable with managing the risks that come with the ‘premium’ strategy. This is very much the model employed by all the businesses I’ve ever worked in, and it’s a far nicer way to do it in my opinion. It’s been likened to selling suits to one legged dwarves. There might not be so many of them, but they are willing to pay a lot more, if you can make them a nice suit.