So you want to open a café? 6 (not-so-rosy) insights from the experts


A lot of people who enjoy coffee aspire to become a café owner one day to serve the coffee they love.

Passion can definitely fuel your drive to run a café, but running a sustainable café business is a different ball game altogether.

Joshua from espressolab and Daphne from Assembly Coffee are generous enough to share their insights in running a café business, and they share a lot of common opinions in the harsh realities of being a café owner.

Capital

http://www.usatoday.com/story/money/business/2014/12/04/starbucks-reserve-roastery-and-tasting-room-coffee-restaurants-cafes-fast-food/19765891/

Before your café open for operation, you have to make a heavy upfront investment on rental deposit, machines, equipment, renovation, furniture, branding and many other little details that add up to a substantial figure.

Just like any other busienss, you have to understand the concepts of profit and loss, cost-benefit analysis, handling your sales and managing your costs, amongst others. Make sure you crunch the number in a worst case scenario and project enough cash flow to sustain for at least a year. It is essential to have a long term plan because running a café is not a 6-12 months stint.

Product

food-coffee

Even though you have a million dollars set up, you have to have solid products that people come back again and again. Do your research on the demography and cater to local taste buds, even though it means selling nasi lemak with specialty coffee. It’s easier to make what people love rather than telling them what to love. Recipes don’t just appear out of nowhere. They are only possible with many trials in the kitchen.

You can introduce new funky stuff and educate your customers to close the gap, but you can’t expect everyone to share your love universally. You can provide choices but do not confuse customers with your offerings. You have to have that thing that customers always associate you with.

People

people

Hiring is easy. Hiring passionate team that will grow your business is hard. To build a great team, you have to put effort in motivating and retaining staff. You have to lead the team by example. Get your hand dirty so that your staffs are willing to get their hands dirty with you. Do not be the emperor that points finger at your stuff, be the leader in front line that lead the war.

Even though you might not be able to reward your staff financially, make sure you do everything you can to make them feel appreciated with intangible compensation. Your staffs need to be happy and motivated to be in this happiness business.

Operation

operation

You can’t run a successful café by hiring an operation manager to run everything for you. It doesn’t mean that you have to be in the store from opening until closing, but you’ve got to be involved in day to day operation to be able to make decision for the business.

You will realise that running a café has nothing to do with the romance of making good coffee. You will be tied up with piles of admin work, dealing with suppliers to minimize cost, managing cash flow, tracking inventory movement, worrying about hiring and having a lot more sleepless nights dealing with operation issue.

Consistency

consistency

Marcus Lemonis has the philosophy that ‘people, product and process’ are the ingredients of successful business. Given that you have strong team and product, you need to have a detail standard operation procedure that maximises consistency in process and services that deliver top notch customer experience.

Starting off with great reviews doesn’t count if you can’t keep it up. One bad review on the internet is enough to jeopardise all the prior hard work. It will become part and parcel of your routine as owner to deal with difficult customers and doing PR.

Scalability

So you’ve got your café up and running, what’s next? Running a sustainable café business takes time and effort. Instead of burning out operating a café, you should automate the processes and define a long term vision before it becomes a routine that doesn’t excite you anymore.

There will be a point where you need to think of going to the next level; be it opening another café, licensing it, venturing into new concept, retailing your product, or bringing your product online.

Eventually, your business has to grow either vertically or horizontally; and that’s the cool thing about being in a café business.

Link to sources

Daphne’s Interview

Joshua’s Interview

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