For a coffee beans and equipment supplier, we’re taking perhaps a non-traditional approach for this “Starting a Coffee Shop” article, concentrating more on the general “marketing” aspect of the subject, rather than the specific “how to make good coffee” side of things. Have a read, and let us know what you think…
SITUATION (where are you now)
Review where you are NOW. What do you have available in terms of time, resources, cash, people, professional support, bricks and mortar, internet assets and anything else relevant to your proposed business.
OBJECTIVES (where do you want to be)
From where you are NOW, where do you intend to be in the future. Decide your own time-frames, which could be as short as a few weeks, to as long as several years, but set out your objectives, for example…
Jan – the here and now
March – find a location
May – agree suppliers and the marketing plan (for launch and beyond)
July – open the coffee shop
September – be serving 300 coffees a week (45 daily coffee sales generating £660 pw approx)
December – be serving 700 coffees a week (100 daily coffee sales generating £1540 pw approx)
Jan next year – employ staff to ease the workload
Jan the year after – look for 2nd coffee shop
Make your objectives measurable – so for “agree suppliers” state how many you need in each sector. Don’t say “sell enough coffees to cover costs” – work out how many you need to sell, based on the costs you’ve worked out – so you know what you are aiming for.
STRATEGY (how are you going to get there)
How are you going to achieve your objectives (whatever they are) – because to do so you need a strategy. Any actions to be taken need to be assigned to a specific person so they get done. This can be a broad strategy or a detailed strategy for each part of your business, for example, taking each of the timed objectives from above…
March – speak to local estate agents, visit local shops to see if they are available, talk to existing shop owners about opportunities
May – research all suppliers of the products we want to offer, see what help they can provide in terms of point of sale materials, marketing and training
July – Ensure local press are informed of opening, get banners, flyers and create an offer, get social media fired up (facebook, instagram etc)
September – to serve 45 coffees a day you need people through the door, so will advertise the opening in the local paper and email all local businesses. If your advertising gets a 1% return (which would be good) you will need to get your advert in front of at least 4500 people ! And various experts say each person needs to see your business 7 times before they might commit.
Jan next year – ensure customers / suppliers / friends / contacts all know that we will be looking for staff.
TACTICS (no, really, HOW are you going to get there)
The tactics are the finer detail of the strategy. If the strategy is to speak to local estate agents and visit local shops, the tactics will be to specify the days of the week, the times of the day, your route, what materials you will take with you, what you will say, and how you will follow up the activity to see if it was effective. How much money you are going to spend on each activity. Who is going to do it. How are you going to measure your success.
TARGETS (who is going to spend their money with you on your journey)
It is always good practice to decide WHO your products and services are aimed at. You may say it is everyone, but it’s better if you identify specific groups of people, and what their interests and needs are, then you can put together a plan of how you will make yourself appeal to them.
For example, let’s say you decide you will target premier league football players from your shop in south Cornwall. This may work (ahem ?) but only if you know how you are going to promote your business to those people and encourage them to come and spend their money with you…?
But it probably makes more sense, if you are in south Cornwall, to target local people and holiday makers? Consider how you will appeal to the local people and how you will get holiday makers to find you – perhaps by talking to the tourist board, local guest houses, B&B’s, camp sites, and so on ? Review the competition and see where you can fill a gap.
Are you aiming at the student market, the retired market or another group. It may be all of these, but your offer to each one might be different. Maybe a special-offer for afternoon tea for retired people (on your quietest afternoon of the week) and maybe a “buy a bacon roll and get any coffee half price” for the morning commuters, for example?!
MANPOWER (who are you going to need to help you on your journey)
At every stage of finding, planning, setting up and running your coffee shop, you will need people.
Friends and family are in that list no doubt (but you need to ask them sooner rather than later, and get their commitment – it’s amazing how keen helpers often vaporise when the work actually has to be done). But you will also need accountants, solicitors, plumbers, electricians, painters and decorators, leaflet printers, web and graphic designers, dustbin men – coffee suppliers !!
Just a point of order here – definately from us as a coffee supplier – we often get contacted to supply a coffee machine for a new business which has been months in the planning, with thousands of pounds having been spent on the premises, floors, walls, kitchen, web site, and yet, here we are on the Thursday morning discussing how we are going to get the espresso machine ordered, paid for, delivered, installed and running by first thing Saturday ! Not to mention the barista training that is still needed (and believe us when we tell you, no matter how good you think you are at making coffee – unless you have been working 40 hours a week, solely as a barista for the last 2 years, you need barista training).
MONEY (how much is it all going to cost to get there)
Everything costs money. Budget now, add 10% (maybe 20%?) and you might be OK.
MINUTES (how long is it going to take to get there)
Every thought and action takes time. Sometimes there is a “critical path” between one thing happening e.g. “(A) find a coffee shop” and another e.g. “(B) open the coffee shop” and it helps to list everything that needs to be done in a column down the left of the page, and then plot across the page how long each step will take and when things need to be completed so the next thing can start. From this, you will get an idea of the time actually needed to get from A to B!
MEASUREMENT (are you there yet)
Unless you can measure your actions, how will you know if they are working?
For example, if you place an advert in a local paper, decide how you will measure its effectiveness, perhaps by making it into a discount voucher or “free cake with every coffee” voucher. You can then compare the cost of the advert with the business generated. It may be you need to run the advert several times before it becomes effective, so use a new tracking code on the voucher on each advert to ensure you are tracking which advert is being used (this can simply be the date of the advert in very small print).
Also, remember if you run an advert or print a flyer and you include your email address, web site address and/or phone number, you may get enquiries via these channels and they will not mention the advert (even if you ask them where they found your details, many will not know or tell!), so always bear this in mind too.
What are your strengths and weaknesses, your opportunities and threats.
A SWOT analysis is a quick and easy way to reveal (to yourself and others involved in the business) a broad overview of your business situation. Some examples below…
Strengths (what makes you so special)
What makes you different from the competition? Your USP’s or “Unique Selling Points”.
Why would people come to your coffee shop instead of someone else (whether that’s a large chain, or another local independent coffee shop)?
Are your staff well trained, friendly and helpful, to ensure customers are encouraged to come back, or give you good reviews (both to their friends and family, but also on social media, which is global)?
Are you cheapest / best / biggest / smallest / most choice / unique?
Weaknesses (what things do you need to improve on)
Do you and your staff fully understand your business and your offer?
Is your location right?
Are your opening times correct for the local market and can you staff them adequately?
Is your product right, and safe, and compliant with all the rules and regulations.
Opportunities (what could make a difference to you in the future)
Are local competitors missing a trick?
Is there a gap in the food / drink / other products arena locally?
Could you open longer hours than traditionally expected to appeal to another audience?
Threats (what do you need to be careful about)
Is the local competition a problem, or a potential problem.
Are there any political, environmental, social or economic changes on the horizon which could affect your business (alternatively, these may be an opportunity)? For example, VAT changes, food hygiene legislation, employment law, planning legislation, green coffee bean prices…?
We hope the above has, at least, provided you with some thoughts.