Presentation on theme: "WHAT TO LOOK FOR WHEN BUYING YOUR FIRST COFFEEHOUSE SHOULD I BUY A NEW OR EXISTING CAFÉ? DRIVE UP WINDOW, OR WALK IN ONLY? HOW DO I NEGOTIATE WITH THE."— Presentation transcript:
WHAT TO LOOK FOR WHEN BUYING YOUR FIRST COFFEEHOUSE SHOULD I BUY A NEW OR EXISTING CAFÉ? DRIVE UP WINDOW, OR WALK IN ONLY? HOW DO I NEGOTIATE WITH THE LANDLORD? DO I HAVE TO WORK IT? Presentation stored at: Boyrista.com/First-Cafe
LEVI ANDERSEN 1.COFFEE BARISTA SINCE CAREER DAY (AGE 6) 10-YEARS BARISTA IN WASHINGTON DRIVE-THRU OWNER, MAPLE VALLEY, WA COFFEE FEST – EDUCATIONAL PROGRAMMING MANAGER ONGOING TRAINING 2.AUDIO CAFÉ PODCAST.COM FREE WEEKLY PODAST 3.BOYRISTA.COM OBSERVATIONS ARTICLES 4.KERRY GLOBAL INNOVATION BEVERAGE PRODUCT SPECIALIST DAVINCI GOURMET, BIG TRAIN, OREGON CHAI COAST TO COAST TRAININGS AND TRENDS CUSTOM RECIPES FOR BRANDS
CURRENT SITUATION PLANNING PHASE LOCATION ALREADY RUNNING VS BRAND NEW LOCATION HOW TO SPOT THE IDEAL EXISTING CAFÉ PLANNING YOUR EXIT STRATEGY OVERVIEW
ARE YOU HERE TO DISCOVER REASONS TO OR NOT TO START YOUR CAFÉ? IS THIS GOOD NEWS OR BAD NEWS? DOES THIS MEAN PEOPLE ARE LEAVING ATLANTA? WILL PEOPLE BE SPENDING LESS? WHAT DO YOU THINK LAND LORDS ARE WORRIED ABOUT? IS THIS GOOD NEWS FOR SIGNING A CHEAPER LONG TERM LEASE? TOO EARLY OR TOO LATE? HAS THIS SPECIALTY COFFEE THING RAN ITS COURSE? WILL COFFEEHOUSES BECOME THE NEW VIDEO RENTAL STORES? CURRENT SITUATION
PLANNING PHASEPLANNING PHASE LOCATION ALREADY RUNNING VS BRAND NEW LOCATION HOW TO SPOT THE IDEAL EXISTING CAFÉ PLANNING YOUR EXIT STRATEGY OVERVIEW
“An ounce of prevention is worth a pound of cure” PLANNING PHASE “Give me six hours to chop down a tree & I will spend the first four sharpening the axe” “I will prepare & some day my chance will come” “He who is best prepared can best serve his moment of inspiration” “Measure twice cut once” “The best preparation for tomorrow is doing your best today” “By failing to prepare, you are preparing to fail”
STARTING A CAFÉ Why am I starting a coffee shop? Would it be easier to just hang out at cafes on the weekend and not overcomplicate things? What kind of ambiance do I want? What can I afford? What fits the locale? Who is my ideal customer? How will they resonate with my café? What menu items will I have? Just coffee, or beer & cocktails, fresh paninis & salads? Am I prepared to spend the time and money needed to get my business started? Is my partner on board to support as well? Is there a reason why no one has tried my specific idea before? How many employees will I need? How will I get all of my supplies? Questions to ask yourself… Re-visit this list & evaluate your options How much hiring and training will I need before I can sell a latte? How long do I have until I start making a profit? How much money do I need to get started and pass the 2 year mark? Who is my competition? How will I be different? Do I need to compete on price? What taxes do I need to set aside & pay? What kind of insurance do I need? How will I advertise my business?
WALK IN CAFÉ $150 - $300K DRIVE-THRU $75 - 250K KIOSK OR MOBILE $20 - $75K TYPICAL STARTUP COSTS WALK IN CAFÉ General contractor fee $30K Cabinets $25 - $40K Plumbing & electrical $15 - $20K each Flooring $6K Paint $5K Equipment $30 - $50K Furnishings $15 - $20k Signage $10 - $15k WHAT DO YOU WANT, WHAT CAN YOU AFFORD?
FUND RAISING Bank loan Landlord needing renter Motivated seller Angel investor KickStarter.com INDIEGOGO.com [Clearly identify investor roles, interest rates & expectations in writing] BUSINESS PROPOSALS BUSINESS PLAN For property managers, investors, lenders Describe what you intend to create Describe your profit centers and menu Identify your ideal customer Unique benefits of your café over the local competition State of the industry and current trends How you will market your business Staffing plan
DESIGNATED AREAS ESPRESSO MACHINE & GRINDERS PASTRY CASE BLENDERS ICE GENERIC AREAS MULTI-USE AREAS PASTRIES, PROMOTIONS & DECORATIONS DESIGNLAYOUT.COM PROFESSIONAL HELP CONSTRUCTIONCONSIDERATIONS
EQUIPMENT: ESPRESSO MACHINE GRINDERS WATER FILTRATION DRIP BREWER ICE MACHINE REFRIGERATION BLENDER COOKING EQUIPMENT WATER HEATER HVAC SYSTEM TEST EACH ITEM AND RATE EACH PIECE OF EQUIPMENT WITH A 1 (HIGH) TO 5 (LOW) RATING OF PRIORITY FOR ADDRESSING. THEN CREATE A PLAN ON HOW TO ADDRESS EACH PIECE. CAFÉ: WALLS INSIDE/OUTSIDE LIGHTING FIXTURES BASEBOARDS/DOORS/WINDOW S/FRAMES AWNING/BLINDS LANDSCAPING SIDEWALKS/PATIOS CEILINGS FLOORS/CARPETS HVAC VENTS CABINETS RESTROOMS FURNITURE ART PIECES CONDIMENT BAR PHYSICALLY LOOK AT EACH PIECE OF YOUR BUSINESS AND RATE IT HOW HIGH OF A PRIORITY (AGAIN 1-5) IT IS TO GET YOUR ATTENTION. BE SURE TO DO THIS WHILE THE BUSINESS IS FRESH TO YOU AND YOU HAVE A EASIER TIME RECOGNIZING WHERE ATTENTION IS NEEDED. ASSESSMENT CHECK LIST
CURRENT SITUATION PLANNING PHASE LOCATIONLOCATION ALREADY RUNNING VS BRAND NEW LOCATION HOW TO SPOT THE IDEAL EXISTING CAFÉ PLANNING YOUR EXIT STRATEGY OVERVIEW
CLIMATE YEAR ROUND TRAFFIC OR TOURIST TOWN? HOW MANY MONTHS PER YEAR CAN YOU SELL THAT HUCKLEBERRY SMOOTHIE (YELLOW SIGN IN CORNER)? HOW DOES CLIMATE EFFECT WHAT YOU CAN SELL OR IF YOU’LL BE SUCCESSFUL? CAN YOU LEVERAGE YOUR RENT ACCORDINGLY? LOCATION LOCATION LOCATION COMPETITION IS IT GOOD TO BE THE FIRST TO TOWN? WHAT IF THERE IS ALREADY A STARBUCKS THERE? HOW MANY CAFÉ CONCEPTS CAN ONE AREA SUPPORT?
DEMOGRAPHICS CITIZENS INCOME (AFFLUENT VS POVERTY) AGE (COLLEGE TOWN VS SMALL TOWN USA) TRAFFIC (HANGOUT VS GHOST TOWN) PERSONAL TASTES LOCATION LOCATION LOCATION
CURRENT SITUATION PLANNING PHASE LOCATION ALREADY RUNNING VS BRAND NEW LOCATIONALREADY RUNNING VS BRAND NEW LOCATION HOW TO SPOT THE IDEAL EXISTING CAFÉ PLANNING YOUR EXIT STRATEGY OVERVIEW
NEW CAFÉ PROS Blank canvas Negotiate tenet improvements with landlord Negotiate you’ll anchor more daily business to the area Negotiate you need ramp-up time & reduced rent Good press or buzz when opening CONS Setting up permits, licenses & insurance Build-out costs & time (Taproom Coffeehouse, GA) Could be new area with minimal traffic Customers base can take years to build Full staff & customer training needed Need to create every system in the cafe
EXISTING CAFÉ PROS Built in customer-base All equipment set up All systems in place Great starting place to enhance Possibly negotiate great deal CONS Customers may not like any change Branding barriers Re-training staff Purchasing outdated equipment Hidden contracts with vendors Abused space
WHAT DO YOU THINK ABOUT THE LANDLORD & SURROUNDING BUSINESSES? ARE YOU THE FIRST OR LAST TENET IN THE BUILDING? First – you can negotiate a lowered rate, say 25% off, till the building is 75% occupied Last – you can convince the landlord that your coffee business will bring new shoppers to the area on a daily basis and help all the businesses in your area. If you’re leasing inside a business space or residence you can show how your café will improve occupancy happiness EMBRACE THE BUILDING TO ITS FULL POTENTIAL You may need to pivot your plan, always tailor to the space SPECIFIC BUILDING SELECTION
MALL, MOVIE THEATER, BALLET CLUB, DANCE CLUB, ETC. Do people come here to get coffee? HOSPITAL, PARK, LIBRARY, CORPORATE OFFICES, ETC. Do people near here want coffee? TALK TO YOUR NEIGHBORING BUSINESSES Ask lots of questions Ask what little surprises you will “Just need to get used to” to really get to the heart of renting woes Are all the surrounding businesses pet shops and pet parks but you’re allergic? Do things look good on paper but your gut says no? SPECIFIC BUILDING SELECTION
CURRENT SITUATION PLANNING PHASE LOCATION ALREADY RUNNING VS BRAND NEW LOCATION HOW TO SPOT THE IDEAL EXISTING CAFÉHOW TO SPOT THE IDEAL EXISTING CAFÉ PLANNING YOUR EXIT STRATEGY OVERVIEW
SPOTTING THE IDEAL EXISTING CAFÉ IT IS MISSING A KEY COMPONENT THAT YOU CAN BRING Energy, creativity, better products, vision, leadership, customer service, new décor or ambiance, more food options, artistic flair, marketing IS A PLACE YOU COULD HANG OUT IN ALL DAY EVERYDAY This will be your second home for a few years FOOT TRAFFIC VS TRAFFIC Nearby anchoring business or traffic obstacle Place that stops cars Place that gets people out of their car, ect 500 cars vs 50 people on foot per hour passing by
DO THE NUMBERS ADD UP (RED FLAG: KEEPING TWO SETS OF BOOKS)? WHAT DO THEY REALLY WANT? LEGACY VS CURRENCY? WHY IS SOMEONE SELLING, OR WHY HAS A LOCATION OPENED UP? WILL THEY KEEP SOME SKIN IN THE GAME TILL THINGS ARE STABLE? WHAT OTHER BUSINESSES ARE FOR SALE IN THE AREA? BE PROACTIVE, CONTACT PEOPLE WHO HAVEN’T PUT THEIR BUSINESS ON THE MARKET TALKING TO THE SELLER
CURRENT SITUATION PLANNING PHASE LOCATION ALREADY RUNNING VS BRAND NEW LOCATION HOW TO SPOT THE IDEAL EXISTING CAFÉ PLANNING YOUR EXIT STRATEGYPLANNING YOUR EXIT STRATEGY OVERVIEW
EXIST STRATEGY - RECOGNIZE THE TIME TO SELL IDENTIFY THE PERFECT BUYER Current staff member? Who is your biggest fan? KEEP HONEST BOOKS; TELL THE HONEST BUSINESS STORY The truth always comes to light Tell the honest answers to why you’re selling, or why business is slower PAY YOURSELF A CHECK, EVEN IF YOU JUST RE-INVEST INTO THE BUSINESS Investing everything into the business is fine, but cut yourself the check first, then pay to support the business. This will be far better when it comes time to sell DON’T HOLD ON TOO LONG Selling doesn’t mean failing
START WITH THE END IN MIND WHO RUNS THE BUSINESS WHEN YOU’RE ON VACATION/GET SICK/ECT? MAKE ONE MASTER EMAIL ADDRESS FOR THE BUSINESS WRITE DOWN ALL PASSWORDS WHO IS YOUR IDEAL CUSTOMER, AND WHAT DO THEY REALLY WANT? LAY OUT YOUR 1, 2 & 5 YEAR PLAN LET YOUR STAFF KNOW AHEAD OF TIME PREPARE FOR A LOT OF CALLS OR EMAILS SELLING PLAN
THE BIGGEST PIECE IS YOU WHAT ARE YOUR INHERENT SKILLS? Are you a Customer-Service-Savant or Barista- Extraordinaire? PERFORM A PERSONAL & BUSINESS SWOT ANALYSIS Look at each café option and see where YOU fit into it TRUST YOUR GUT Identify why good/bad vibrations Is this a good idea for you right now? Will your spouse support the business, or all the extras that come up along the way? How committed are they? ASK OTHER PEOPLE TO VISIT THE LOCATION Easier for them to tell you it’s a terrible idea before the fact rather than helping after the doors have opened
THANK YOU! WISHING YOU ALL THE LUCK IN THE WORLD THIS PRESENTATION IS STORED AT BOYRISTA.COM/FIRST-CAFÉ ADDITIONAL NOTES & LINKS SUGGESTED LINKS: BOYRISTA.COM/ABOUT CONTACT LEVI: LEVI@BOYRISTA.COM @BOYRISTA (TWITTER) @AUDIO_CAFE (INSTAGRAM)
COFFEEBUSINESS.COM Full one week business training in Portland or New York They have done it all BREWEDBEHAVIOR.COM Tracy Allen: Q Coffee Grader Vice President of SCAA Zoka Coffee Roaster & Tea Co COFFEEGROOT.COM Midwest Barista School Jp’s Coffee & Espresso Bar TRADE MAGAZINES Barista, Roast, Fresh Cup, Specialty Coffee Retailer, Sprudge.com PARTNERS I TRUST
THIS MAY STING, BUT LET’S BE HONEST… KEEP IT CLEAN Have you ever been in a beautiful building that is filthy? Have you ever gotten into a really cool car and were surprised by the stench inside? Its an awful experience. Don’t let your café get dirty! You may not be able to have an amazing barista who is also great at leaning carpets or random corners – but fear not! There may be a great solution to this problem. Look in the community for a cleaner who wants to trade* gift cards for cleaning. Why not let a pro handle this for you? Just know that each quarter of the year you should deep clean your cafe and perform the machine maintenance you know you need to do. SECRET SHOPPERS Use Secret Shoppers to give you honest feedback on your business. You know that your baristas are on their best behavior when you’re there, but how do they really act when you’re away? In the same way you need Secret Shoppers to evaluate your business. You become blind to those little things like cracks in the paint or stains. If possible find someone who has never been to your business so you can use their first impressions. Seek outside help, then thank them with a nice gift. SENSE OF URGENCY Never lose your sense of urgency and action. If you don’t do it now you never will. If you need to close your doors then pick a slow day and time and do it! I’ve worked at a café where slowly pieces of our espresso machine died, till one morning all we had was one steam wand and one group head functioning. I can tell you that the owner didn’t make very much money that day (and I didn’t make the same tips either!). ASK YOUR STAFF Empower your staff to have ownership and have a voice in the business. Have regular meetings where people feel safe to share thoughts. You’ll be blown away by their ideas. You can also have them take care of the idea and implement it (this will cut down on complaints!) at the shop. Your staff will start to look at their job like an owner does and will become more in tune with how to take care of customers and equipment. RAISING YOUR PRICES People don’t buy on price anymore… Well, most people don’t. Don’t shy away from making a living, don’t delay price increases. MUSIC PLEASE don’t have ads or skipping songs playing. Seriously? Also volume matters, turn it up on the weekends, don’t be shy. LIGHTING Have you considered mood or accent lighting? SOAPBOX, PLEASE!
NEED: “Cover creating unique/signature drinks that resonate your brand, café management and drink production guidelines, planning recruitment and training staff.” EQUIPMENT NEEDS