Want To Open a Coffee Shop? Read This First.
Sooner or later, it seems that every diehard coffee lover thinks about opening their own coffee shop. We get it. You love your coffee and you want to share it with everybody you meet. You really want people to experience the joy that carefully sourced, expertly roasted and lovingly prepared coffee brings. At some point you've probably walked into a cafe and said, "I could do this." If you're seriously considering opening your own coffee shop, read on for an outline of the things you should consider before you get started.
1. You: Let's start with you. Have you ever worked retail, or in a position that requires dealing with cranky, demanding people in high volumes? Many of us who've worked retail would agree that the job would be great if not for the people. Unless you have a lot of patience and a healthy dose of humor, you might not be the right fit for retail.
2. Your Community: Will your community support a coffee shop? Figuring this out is trickier than it sounds, since plenty of people like coffee, and might buy enough Starbucks to make the average hippo quiver like a bowl of jelly, but they might wait 'til they're closer to work to buy. Look at the types of businesses in your area -- both the types, and how long they've lasted -- and take that into consideration.
3. Location: Let's say you've decided that your community is clamoring for Third Wave coffee. Your next step is figuring out where your shop will go. The areas with the best foot traffic will likely be the ones with the highest rents, which sometimes means finding a happy medium between rent and the added marketing expenses that come from being in a less-trafficked part of town.
4. Real Estate: You'll need a space large enough to accommodate your staff and customers (plus food, impulse buys, and anything else you've decided to feature), but not so large that you're wasting money on excess square footage. The odds of finding a location that's 100% move-in ready are slim to none, so you'll also have to consider layout, work flow, and the amount of repairs and new construction it'll take to get your shop up and running.
5. Education: You'll need to learn the ins and outs of small business generally and the coffee business particularly, including sourcing, roasting, and making coffee. Your staff will need training as well. Keep in mind that training is an ongoing concern.
6. Equipment: A Nespresso, a Mr. Coffee, and your grandma's old percolator aren't going to cut it. Even if you're buying roasted beans (eliminating the need for a roaster on-site), you'll still need a grinder or two, espresso machine(s), pourover cones, French presses, dishes, cups, cutlery, seating, consumables (napkins, to-go cups, cream, baked goods, etc.), and quite a bit else besides.
7. People: From advisors to staff, make sure you're surrounding yourself with quality, committed people. Remember that it's business, not personal; you'll also need to be able to let them go if they're not moving your business forward.
8. Business Plan: Now that you've taken into account all of your business's components, it's time to start figuring out how it all fits together. Just as important, this step is figuring out how you're going to pay for all of it (your ongoing costs as well as your initial investment). In many ways, starting a business isn't the hard part; it's sustaining and growing the business once the doors open. Getting your business plan in place will help you figure that out, and to see what you might've missed up to this point in the process before you start laying out cash.
9. Reinvest: Invest in your business. That means investing in yourself, your people (payroll and training), your equipment (maintenance and upgrades), your store and your marketing. For an increasing number of businesses concerned with the 3BL, it also means investing in, and giving back to, your community.
10. Exit Plan: Nobody goes into business planning to fail, but many businesses do go under. It's best to plan for the worst so you can exit gracefully before suffering catastrophic losses and debt. If you have your ducks in a row, and the right people on your team, it's less likely you'll need it. However, it's always best to be prepared. Want to learn more? There's a wealth of resources on and off-line to help you decide whether opening a coffee business is the right move for you. Andrew Hetzel's Coffee Strategies features a series of handy Tips to Start a Coffee Shop, while the American Barista and Coffee School offers classes in New York and Portland for aspiring baristas and entrepreneurs. Nick Cho of Wrecking Ball Coffee Roasters shares his own tips learned from years spent opening and operating coffee shops at SeriousEats, while Peter Baskerville -- a success in his own right -- offers still more advice at Quora (via Forbes) with What's The Secret to a Successful Coffee Shop?