Are you a brand new coffee shop owner trying to stand out from the big box competitors? We know that coffee drinkers are loyal. They are also creatures of habit, who know what they like and how they want their cup brewed each and every time. This unique consumer base can make it tough to acquire new customers. Starting a successful coffee business will call for blood, sweat, and tears, and of course, a lot of caffeine.
Not all is lost though. There are simple tips that you can try that will help elevate your storefront ahead of the competition.
Hire a trusted bookkeeper or accountant. Having accurate information allows you to keep your finger on the pulse. This is crucial when making future business decisions. Having an expensive accountant that is good is cheaper than having a “cheap” accountant that ends up being bad. Mistakes can lead to IRS audits, late fines, and valuable time spent trying to correct mistakes made by an unreliable accountant.
Lease equipment: You don’t have to purchase every piece of equipment outright. There are many companies that offer affordable equipment leasing options or flexible working capital options can free up cash flow and allow you the flexibility to purchase all the equipment and inventory that you need to operate a successful coffee shop.
Attend local events. There’s magic in grassroots marketing: Getting to know your local consumer base is invaluable. Seek out your local coffee lovers and get to know them. Ask them for feedback and then ask for referrals. Attend local events like a Saturday downtown market, and set up a booth with free samples of your product. Allowing a potential new customer the opportunity to try your coffee for free is a sure-fire way to entice them into your shop at a later date.
Minimize your menu: Less can be more. Simplify your menu. Having items on the menu that are not confusing to the customer can draw in a different demographic. Not everyone is willing to pay $8 for a cup of coffee. Some consumers just want to walk into a coffee shop and order a high-quality cup of coffee without all the frills and confusing names and add on’s.
Avoid used equipment: While purchasing used equipment can seem like a bargain, the unknown can do more damage than good. Not knowing the service history of a machine, what kind of water it was connected to, if it was properly maintained, cleaned, and stored correctly, can lead to headaches and more money spent in repairs down the road. Invest in the peace of mind of having a warranty and a reliable service contract with a reputable technician.
Loyalty cards: Offering free loyalty cards that lead to a free cup of coffee can build repeat customers. This is an affordable and efficient way to engage your first-time customers and entice them to come back. Besides who doesn’t love a free cup of coffee.
Keep a close eye on your business margins: Increase your margins on products that are unique to your brand and gourmet items. Alternatively, decreasing margins on items like sodas, bakery items, and other snack items can help entice customers to add on to their coffee order. The margins on your higher-priced items should be able to offset the lower margins on nonspecialty items.
Have working capital in the bank when you open: Having a 6-month cushion of working capital in your bank account prior to opening your doors will allow you the room to grow into your new space during those first crucial beginning months. More importantly, don’t underestimate your growth. Forecasting too slow can hinder growth, make for inadequate staffing, and slow down your ability to serve as many customers as possible.
Be active and consistent on social media: While Facebook and Twitter are great social media outlets, Instagram has been king when it comes to the local coffee shop culture. Posting a daily photo of beautifully crafted cups of coffee and delicious baked goods can sometimes be better than a referral. Consumers love seeing what their friends are doing, where they are hanging out, and where they are going to enjoy food. Encourage customers to take photos and tag your business in them. Also offering a free item or discount to every customer that check’s in at your location will also help your business flourish on their social media.
Find a trusted source of working capital: Expensive pieces of equipment can break, marketing campaigns can get expensive, and hiring reliable staff can all put a drain on the business operating account. Having a trusted source of funding can turn a dire situation into a profitable one.
Take the time to celebrate the wins: Being a business owner can seem consuming when it comes to managing staff, putting out fires, and always taking care of everything for everyone. Don’t forget to celebrate the wins along the way. Celebrate milestones by involving staff and your growing consumer base with each triumph. Celebrating an anniversary or a charity event can be a fun way to get consumers involved while also staying relevant in your local community.
DISCLAIMER
The information and insights in this blog post are provided for educational purposes only and do not constitute financial advice from Merchant Funding Solutions Inc. Please consult your financial advisor before making any business financing decision. For information about Merchant Funding Solutions products and services, please visit the Merchant Funding Solutions FAQ page.
