Back in 2005, I wrote a document called “12 Fundamentals of a Successful Coffee Business,” which was a short article, about 15 pages, that compiled my advice addressing the major mistakes I had noticed while working with startup coffee shop retailers. Despite the guide’s popularity, I decided to pull it offline sometime in 2008, as my professional work was trending away from retail and more toward coffee agriculture and roasting topics. Four years later, I still receive requests weekly for copies of that document and recognize that I made a mistake by taking it down, so I am pleased to present you with this updated version, which will remain online and available for all.
12 Tips for Starting a Successful Coffee Shop
by Andrew Hetzel
The retail specialty coffee industry is unique in that it attracts as many admirers of the resulting product (coffee fanatics) as it does those that are looking for a lucrative business investment, possibly more. It is human nature to focus on those things that are of greatest personal interest to us — in the case of the coffee fanatic, that is all things coffee!
So for the good of your business, I ask you to put down that glossy espresso machine product brochure and step back from those roasted coffee samples and the tiny single serving bottles of flavoring syrups. Let’s spend the next few moments talking about something even more important than the product, the critical business issues that will define your retail coffee business – I promise that it will be worth your time and that you can go back to the taste testing when we’re done.
A word of caution: this document is not intended to be a paint-by-numbers template to start a coffee shop. If you are one of the millions of proudly self-professed Dummies that requires a handbook in order to start your business or learn Microsoft Windows, you had better stop reading here… this is different. This article is designed to stir some thoughts for those preparing to make a serious physical or emotional investment.
With alarming frequency, coffee roasters and consultants receive inquiries from new and prospective coffee shop owners such as, “What should I name my coffee shop?” “What sugar free syrup tastes best?” or “Should I pick the San Macaroni 5-group espresso machine or the La Spaghetti?”
New entrants to the retail coffee industry focus a disproportionate amount of valuable time and resources on coffee shop gear, products, logo colors and other minutia that may affect the style or identity of a business, but in fact, do not define that business and are probably not the factors that will lead to its eventual success or failure.
It may be nice to know which synthetic concoction gives your calorie counting and diabetic consumers the best sense of real chocolate in their sugar free café latte, but the resulting drain of your time away from real issues may commit your new coffee shop to failure, even before your shiny new La Spaghetti is out of the packing crate.
If you have already started your new shop and recognize any of the examples above as being yours, don’t worry; it’s never too late to start fixing the items addressed within this document. For others that may be considering starting a new coffee shop but have not yet taken action, we hope that the ideas listed herein will give some insightful reflection on the issues that will impact your business so that you may continue to pursue your goals with a new found sense of confidence.
#1 Is Retail Right for You
#2 Write a Business Plan
#3 Plan Your Budget
#4 Choose a Location
#5 Learn About Coffee
#6 Know Your Market
#7 Invest in People
#8 Pay Yourself
#9 Know When to Quit
#10 Choose Good Advisors
#11 Document Everything