1. Have a Vision
Passion with a vision is the driving force you need to move into action and succeed. Your desire will be the fuel to your success, and your customers will sense your love and dedication to the business. This vision and passion not only fulfills your personal dreams and desires, but it delivers an exceptional outcome and experience to your customers. When the going gets tough, you’ll need that fuel to get you through and when you put your heart and soul into something you love, the payoff is even greater.
“People with passion can change the world” —Steve Jobs
2. Do Your Research
Knowledge is power and it is a major contribution to your success. In order to gain knowledge, you must do your research. Start by learning the ins and outs of what makes a successful coffee shop.
There are many ways to do this, from hands-on experience to networking, asking other coffee shop owners with experience and educational tools such as books, classes and online content. This will provide you with important tools and information to move forward with confidence. Write a list of questions to help you gather the information you need. Some examples include:
- How do you roast your own coffee beans?
- What makes a great cup of coffee?
- What are the best machines to use?
- What are the coffee shop essentials?
- What is the competition like in the area?
- What are the health codes for a coffee shop?
- What other sources can help the business grow?
The more knowledge you have, the better your business will be. You’ll have more insight on how to run it, and you’ll be able to make good decisions. Your staff will trust in you and your customers will enjoy buying from you.
3. Identify Startup Cost and Equipment
No matter what, starting a coffee shop will have expenses, and these are essential for your operation. If you are choosing a brand-new retail location, it will be more costly to build and renovate than it will be to rent an existing location. Depending on the size and location of your coffee shop, cost can vary from $100,000 to $600,000. Determine what your budget is and what your limit is to spend on the necessities including renovations, furnishings, products and equipment. Some common startup costs that you’ll have include:
- Rental space
- Utilities
- Licenses and permits
- Insurance
- Advertising
- Staff wages
- Furnishing and equipment
To gain a full picture, separate your one-time costs, such as licenses and permits, equipment and renovations, from your monthly costs, such as utilities, advertising and employee wages.It’s better to overestimate than underestimate, and it’s important to have additional funding to cover operating costs until the business becomes profitable. This can take anywhere from six to 12 months.
4. Develop a Branding Strategy
Branding is much more than a logo. It not only represents the overall identity of your business, but the quality of your product, allowing customers to recognize, become familiar and trust your services. Think of it as the face and personality of your coffee shop and what makes your café unique and stand out.
Ask yourself, “How can I leave a lasting impression on the consumer and how do I want my customers to feel when they arrive?” You want your brand to activate their senses so they will automatically anticipate the full experience before they even walk through the door. This leaves a lasting impression on the consumer, encouraging them to talk about their experience with others and visit again.
Here are some helpful questions to ask yourself when developing your brand:
- What makes your coffee shop unique? For example, the coffee beans, the atmosphere, the environment, the services, the ingredients, etc.
- What kind of experience do you want to provide, and what is your overall theme for the shop?
- How can you create a sense of community, and how does it serve others as a gathering hub?
- Is your brand logo appealing, and does it translate well on packaging, social media and merchandise?
- How will your logo create a sense of familiarity and trust for consumers?
Once you’ve found the perfect design, don’t forget to trademark your logo and protect your creative assets.
5. Find a Location and Commercial Space
When starting a coffee shop, it’s important to choose a location and space that provides a wonderful experience for your customers. With that in mind, you’ll also need to consider other factors that will determine the success of your business, returning true profitable potential.
Pick a location that targets your ideal customers. You want to make sure there will be enough foot traffic in the area to provide your coffee shop with high volume and avid coffee drinkers—keeping your business steady year round. Get an idea of population density in your area by contacting the city or visiting census.gov census data by zip code.
Research other coffee shops in the area. It’s a good idea to research other coffee shops in the area to see if they compete with the products and services you provide. Some coffee shops target specific audiences or have limited hours of operation. This could help you determine whether or not you want to target customers who are early birds or night owls. Maybe you want to serve breakfast sandwiches in the morning or dessert and coffee in the evening.
Either way, it’s a good idea to make sure you’re not in competition with your neighbor—try to complement them instead.
Find a location that is easily accessible. Customers are drawn to locations that are easily accessible whether on foot or driving. Customers love the convenience of hassle-free parking and street visibility for those walking from one destination to another.
Find a commercial space. Finding a cozy coffee space is just one necessary component to an exceptional café experience but, unfortunately, not all commercial spaces will be able to accommodate more than that. Coffee shops require a unique set of accommodations, such as sufficient space to move around, room for espresso machines, couches and tables, kitchen space, gas, drain and water lines just to name a few. Remember to take all of it into consideration.
Find a commercial space you can afford. This falls in line with your budget as an ongoing cost, making it a commitment for the long haul. Consider the length of the lease, rent increases, renovations, insurance requirements, security deposit, maintenance and repairs. This not only plays a role in your coffee prices, but can directly affect any business loans.
6. File for Permits and Licenses
Before you start firing up the espresso machine and filling the display case with baked goods, you’ll need to get approved for state and local licenses and permits. Make sure you’re prepared ahead of time and be aware that these licenses and permits take time to secure. Permits and license requirements vary from state, city and county so be sure to check with your area of operation in order to fully operate in compliance with state laws and regulations.
Here are some licenses and permits you’ll likely need to open a coffee shop:
Once these important documents are set in place, you’ll be well on your way to opening your doors.
7. Choose the Right Coffee Supplier
A successful coffee shop is one that brews quality coffee time after time. A delicious cup of coffee keeps your customers coming back for more, making the experience enjoyable and worth every penny. When sourcing coffee, you’ll want to offer a product you’re proud of and to do that you must partner with the right supplier.
Here are a few key pointers to consider when choosing your coffee supplier:
Quality
Coffee lovers can be picky so be prepared to brew a high-quality cup of joe. When scouting the right supplier, there are many factors to take into consideration. Learn about the origin, how the coffee is roasted and where they source the coffee beans. If possible, visit the supplier and sample the coffee firsthand or request samples by mail. Inquire how the coffee is stored—as heat and humidity can damage the flavor and quality. Look for a coffee roaster that offers a wide variety of coffee bean options and falls in alignment with the vision of your café.
Quantity
Find a supplier that can support low minimums to higher-volume capacity and has a fast and reliable turnaround. Once you find a supplier that suits your needs, you’ll want to make sure the supplier is able to grow with you. You may want to purchase a wide variety of coffee beans or a minimum quantity to start and a larger quantity as you grow. Either way, make sure you choose a supplier you can rely on. Your business will have fluctuating needs and you want to make sure the supplier is consistent and can provide a steady supply.
Customer Service
Think of your supplier as someone you are forming a long-term relationship with. You’ll want them to be just as committed to your success as you are. A good supplier will provide great customer service and walk you through each step—from roasting to packaging, sampling, creating blends and making small to large orders.
Price
There are a few important things to consider when finding a price that works for you, including quality, customer prices and profit. First, determine if the supplier offers quality beans for the price, Second, decide if the price is fair for your customers and what your profit margin will look like. Lastly, will this price allow you to turn a profit? Great coffee does not come cheap, but it should not break the bank either. Most importantly, the taste and price should be worth a return visit.
8. Design Layout and Workflow
Your coffee shop layout and workflow will play a critical role in attracting customers to your café.
Not only is ambiance and environment important, but so is the customer flow, food flow and coffee flow.
Here are a few things to consider when designing a layout:
Create a first impression. From a marketing perspective, your first impression determines who will become your customers. Determine what message you want to convey and what type of experience you want your customers to have when they walk through the door. Is it cozy and quaint? Is there music, study areas or areas for conversation? Not only is ambiance important, but so are the little details—such as where your customer will stand in line, wait for their coffee and move comfortably from place to place.
Create a good workflow design. Keep in mind, you’ll want to provide great service to your customers and with great service, you’ll need to move quickly and efficiently. Coffee shops can get busy, so it’s important the layout allows your baristas to move gracefully and swiftly when under pressure. Create a layout that allows the barista to be in a good flow from taking orders to brewing, grinding, steaming and frothing.
Long before you sign any contracts, make sure the building can accommodate a good workflow and area design. Consider how you will arrange and place the essentials:
- Coffee machines, grinders, milk frothers and kitchen equipment
- Storage and supplies
- Food display
- Menus and signs
- Outdoor and indoor seating
- Food assembly
- Coffee assembly
- Customer and employee flow
9. Order Equipment and Supplies
Quality equipment is necessary for a good cup of coffee but, unfortunately, equipment is not cheap. It’s best to do your research when making big purchases and remember quality equipment is a long-term investment, essential for the growth and success of your business.
Here is a list of equipment essentials you’ll likely need for your café:
- Espresso and coffee machine
- Coffee grinder
- Water filtration system
- Refrigeration and freezers
- Hot food equipment
- Point-of-sale (POS) system
- Dine-in and take-out coffee containers
- Ice machine
- Bakery display
This is just a starter list of your standard equipment and supplies. Remember to do your research because every detail counts. Get ready to stock your shelves with blenders, stirrers, syrups, varieties of milk, condiments, containers and thermometers and more. Inventory management software is also a great tool for tracking and identifying these items, making it easy to know what’s in stock and what needs to be reordered.
10. Hire and Train Your Team
A good barista goes a long way, from the very first interaction with the customer to their coffee-making skills. Remember, the people you hire are the face of your café and they have the ability to make a positive difference to your customers’ day. Customer service is everything so hire staff who know the importance of building relationships with people and have strong communication skills. Customers love genuine interaction and it will help create a bond between the customer and the café.
You also want to train your employees properly so they can make a great cup of coffee with confidence. Make sure the barista is ready to learn and is fully equipped with all the essential tools and knowledge to succeed—even a skilled barista will benefit from a refresher.
Here are a few must-haves to look for when hiring and training a barista:
- Great customer service
- Strong communication skills
- Attention to details
- Ability to multitask
- Ability to work under pressure
- Responsible and reliable
- Willingness to learn
- Cleanliness
- A positive attitude
Overall, a great barista will not only have a love for coffee, but they will care about the success and reputation of your business. Learn more in our guide about how to hire employees.
11. Market Your Brand
It can be frustrating to gain exposure when first starting out, so having a marketing plan for your brand should be top priority. It’s also important you tailor your ads and promotional products in a way that attracts the right people. There are many influential ways to promote your brand, so make sure to utilize all avenues of marketing—whether it be through online web content, social media, storefront advertising or involvement in the community.
Let’s take a look at a few ways you can promote your brand:
- Create a website
- Search engine optimization (SEO)
- Social media
- YouTube, Instagram and Facebook
- Influencer marketing
- Community gatherings and pop up shops
- Giveaways and raffles
- Paid advertising
- Networking
12. Open House
Hard work pays off and once the paperwork is signed, decor is in place and staff is on the schedule, it’s time to open your café. To do so, you’ll need to get people to walk through your doors on opening day.
Now is the time to create a buzz through your social networks. Plan a ribbon-cutting event to promote your business or welcome a few people to a soft opening for an exclusive firsthand experience. Post about opening day on social media, letting your target audience know you’ll be open for business. You can even offer discounts or freebies as an incentive; this will help build curiosity and entice people to visit.
During the open house, it’s a good idea to show the face behind the brand. Mingle with your customers and take the time to know your community as this helps to build good lasting relationships.
