Starting your own café can put you on the path to becoming financially independent. That is, as long as you manage both the obvious and not so evident aspects of running a business. Like any major undertaking, you’ll need a plan that begins with your vision of what you want your business to be.
How To Start A Café Business Plan
The first step towards starting a coffee shop is to write your business plan. It’s essential if you will be applying for financing.
As tedious as it may sound, it’s actually a good thing. It’ll help you see the reality of your vision from location to product offerings. It’ll also force you to consider the money angle. One of the main reasons that businesses fail is because of inadequate cash flow.
A business plan will guide you through the process of setting up and stocking your store. In these beginning stages, it’s a living document that you can refine as you learn more about your industry and your place in it.
Beyond this, writing up a business plan when you’re looking to start your own coffee shop will force you to think carefully about what you’ll need to find success. That will mean reaching out to mentors or veterans in the space and learning from their own experiences. Find out what made their journey work (or not work) and create a plan that addresses these challenges.
A handy tip might be to consider what makes your business different from those around you – if there’s plenty of competition in your surrounds, you’ll need a distinct point of difference to set you apart.
A few things to include in your plan:
- A summary of what your business is and how it will stand out from local competition;
- An analysis of the local market – this should include a summary of who your regular customers are and the competitors you need to keep an eye on;
- An outline of your intended team – include your role;
- A marketing plan that communicates your point of difference;
- Financial forecasts and projections – note down projected profit and loss, as well as cash flow;
- A strategy that outlines your location and whether you will rent or buy.
Don’t skim over this step; as one of the most crucial parts of the process, this task is a challenging but enlightening part of the journey. You’ll have to think carefully about every aspect of your vision, and realistically align these objectives with the resources and financial support you have on hand.
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Find Your Cafe’s Niche
In a relatively saturated market, it’s important to establish your point of difference to stand out from the crowd.
That’s where a good session of brainstorming will give you the upper hand. Think about things such as what you’ll offer, as well as your signature coffee drink.
The key to success is to think of evergreen ideas. Fads come and go in the café business as in any other industry. Your goal is to offer products that will stand the test of time.
That’s where all the research you’ve done comes into action. Make note of what they sell and other aspects of the business such as live music or food offerings. When you’re busy jotting all of this down, try to combat the following points as well:
- What kind of atmosphere do you see your business featuring?
- Do you have a vision board of photos, menu ideas and design to give you inspiration?
- How will your customers feel when they visit your location?
- Is your name consistent with your look and feel (and vision)?
- Does the decor, food and smaller details (like coffee cups) all reflect your consistent branding?
- Who are you designing all of this for? Does all of the above reflect their personalities and values?
These details are often left behind, so it’s important to cover them off before you’ve gone in too deep and suddenly find yourself lacking consistency or flow.
Choose Your Product Line
Starting your own café and succeeding at it will depend on the quality of the products you offer. You’ll need a reliable source of excellent coffee. The same applies to any other things your café will sell.
It’s essential to research what additional laws and regulations will apply if you have prepared food or meals made on site.
Beverages like coffee and tea have a good profit margin—if priced right. Food is another story. You may find it helpful to talk to other business owners to get a realistic view of the pros and cons of going this route.
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Cafe Equipment and Employees
When thinking about how to start a café business, you’ll also need to research the equipment that you will use in your shop. That isn’t a decision you want to rush into without taking the time to do your homework. The success of your business depends upon it.
There’s also plenty of options for you to choose from. For example you may choose to buy equipment outright (using your financial support) or to lease it from a provider. Many venues obtain loan coffee equipment from their specific roaster, so this part of the process is always well-worth.
- Make a detailed list of all the equipment you’ll need. If you’re not sure what you’ll need to put on this list when you’re researching how to start a café, we recommend reading up on our ‘Café Startup Equipment Checklist’ here.
- Go to trade shows and talk to vendors. Your earlier research scoping out the competition will also help with your choice.
- Consider whether you will incorporate a POS system to help you with customer flow and operations.
- You should take the same care when hiring employees or baristas for your business.
- The skills of your people and the hospitality they offer are just as important as the coffee beans you purchase. A well-trained employee will know the difference between a latte and a cappuccino—and know how to prepare them correctly. However, remember that there’s one detail that’s even more important than experience: attitude.
- Ensure you have a quality induction system in place, so that you can onboard new staff efficiently. This should include workflow training, barista skills and even admin processes (like tax and awards).
Develop Your Marketing Plan
It’ll take more than brewing up a ripper café au lait to succeed as a coffee shop owner. You’ll need to get the word out so that customers can find you. That means an online presence with a well-designed and up-to-date website. These days, there’s no excuse not to have one. It can actually work against you. You’ll also need to tap into the potential of social media.
It’s an excellent opportunity to interact with your customers. You can use it to offer specials or simply to build brand loyalty. It’s also a great way to learn what your customers want so that you can refine your product line for more sales.
However, it’s essential to stay current with your account. Share information and tips in addition to discounts to avoid coming across as pushy.
When you’re developing your marketing plan, consider:
- What social media channels you will be active on. It’s good to be active on all, but even better to really own one channel well. For hospitality – and especially cafés – Instagram carries enormous potential.
- Increase word-of-mouth by proactively collecting reviews. Think Google Maps, TripAdvisor and Facebook (to name a few). Reward those who leave feedback and address any negative ones appropriately.
Prepare lots of intriguing visual content that you can utilise both digitally and traditionally. Even a smartphone can make magic happen – so experiment as much as you can.
The Finer Details to Business
Many of these decisions are the fun part of how to start your own café. There are other details you need to consider before you pour your first cup of coffee such as your POS café system, business hours, and the decor of your shop. All of these things play a role in your success.
Opening a coffee shop is an exciting venture that demands careful planning to succeed. The best way to ensure a profitable business is to take the time to plan the details before you grind that first scoop of beans. The time you take before the doors open is money in the bank.
Learn more invaluable advice about starting up a café on the Impos blog today. We also recommend checking out these reads to help you get started:
Want to find out how Impos can help you start your own coffee shop? Talk to us now for a no-obligation discussion on how we can support your business.