7 Mistakes to Avoid When Opening a Coffee Shop Business

There’s something romantic about coffee houses. The idea of a place within the community for people unwind, catch up with friends, hear music, grab a bite to eat and of course to get a delicious cup of coffee.

The allure of opening a coffee shop couldn’t be more attractive these days.  “How cool would it be to own our own coffee shop business?”  Many have their own romantic ideas of what a coffee shop experience in their own community needs to feel like.  Some get so attached to this idea and how it makes them feel, that they decide to embark on the a journey to open their own specialty coffee shop business.  Unfortunately, many coffee businesses fail to get off the launch pad, or even worse, close their doors shortly after opening due to poor planning and a number of factors the would-be coffee shop owner never considered while romanticizing about the perfect coffee shop experience.

Opening a coffee shop is a lot of hard work and can be quite trying at times, but it can be, and is done successfully everyday by countless smart, creative, and hard-working entrepreneurs.  The difference between these entrepreneurs and the afore mentioned group is their approach, planning ability, execution, and reasoning for doing this in the first place.  Over the years we have observed a lot of common mistakes among struggling coffee business owners.  It’s not to say these are the only reasons they struggle, but by addressing these issues early on and avoiding these problems later, you can absolutely start the race ahead of the pack with your own coffee business:

Opening a Coffee Shop

The biggest mistake you can make when opening a coffee shop is getting into the coffee business for the wrong reason(s).  It seems that at some point everyone has a fantasy of running a cozy little coffee shop hangout where they can be friends with all the neighborhood regulars.  It’s not as easy as it sounds.  When opening a coffee shop there tends to be a fair amount of competition and it involves a lot of hard work. To be successful in this industry it requires hard work and a healthy dose of passion.  Most people looking to start a coffee shop business cannot explain why they are opening their coffee shop in the first place.  They can merely justify it.  “There isn’t a coffee shop in my town, so I want to jump on the business opportunity before someone else does.”“Coffee is a multi billion dollar industry. People love coffee and are willing to spend upward of five bucks a cup at some of those big chain shops. The market it ripe!”“I don’t really drink coffee, but I’ve always loved the vibe in coffee shops.  I just want to create a place in our community for people to come hang out.”  These are not reasons why one should open a coffee business.  These are justifications for carrying out an idea.  There’s a key difference.  None of the above reasons will motivate or inspire anyone to stay the course through the low points of business – and there are always low points.  None of these reasons have enough substance to act as a driving force to get back on top.  This is a very important factor.

Choosing a Coffee Shop Location

One of the worst mistakes a coffee business owner makes is selecting a location based on a gut feeling without doing proper research first.  Probably one of the hardest things for people to realize is that the right location is worth waiting for, even if it takes six months to a year to find.  Patience is the name of the game when seeking out a location for your coffee shop business.  Before you sign a lease make sure it is in an area where people will identify with your concept and your point of view.  Know how many people drive by, how many people walk by, what was the location previously, why the previous tenant vacated etc.  Talk to the neighboring business owners.  Would they lease there again?Understand that you can be just 100 feet in the wrong direction, next to the wrong type of neighboring business, or be on the wrong side of the street and it can absolutely cripple your business.  To start, reach out to your local Chamber of Commerce to get a rough idea on traffic numbers in the area you are considering.  Then hire a coffee business consultant to help you assess the location and point out the positives and negatives before moving forward.  Many good coffee business consulting companies can even run a mathematical formula to get a conservative estimate for the kind of numbers a location can potentially produce based on local conditions.  This way you have some data for your coffee shop business plan and you aren’t just shooting from the hip.

Coffee Shop Employee Training

The importance of barista training cannot be emphasized enough!  Your new coffee business only gets one opportunity to make a great first impression.  There are a number of customers who have been eagerly awaiting the opening of your new coffee shop.  These are the people who have been following your progress on social media, and poking their head in to find out when you open.  They are called early adopters and they are critical to the early success of your new business.  They are the friend within a group that is always posting pictures of food on Facebook.  They are the go-to within the group for good restaurant advice.  They are passionate and they always have an opinion to share when it comes to food and restaurants.  If you exceed their expectations in the very beginning they will be your biggest cheerleaders.  They will blog about you, talk you up with their friends and family, and a few of them likely work for some sort of media outlet and have the power to get your shop published or broadcast in the media.  This can rocket your business ahead in the income department and is absolutely critical in the early months.  If you let this group down, however, you will likely not receive this benefit and the road to success will be a lot longer and more rocky.  It all ties back to quality barista training.  You absolutely need your staff coming out of the gate strong and firing on all cylinders so you don’t miss out on this opportunity.The truth is, making exceptional quality coffee beverages in a manner that is efficient and friendly takes a lot more than just grinding some beans and pushing a button.  A number of coffee business operators decide they will educate themselves on coffee and then train their staff themselves.  Unless you have years of experience in the industry, this is probably a terrible idea.  For a high-quality barista training course the trainer needs to not only know coffee but also know how to teach people.Many roasting companies offer training, however, it is often of relatively low quality.  Many of these companies training programs are created more to serve lower caliber cafes and restaurants rather than quality, specialized shops.  In other cases, even if the staff of the roasting company are fantastic baristas, they are often not great teachers and do a very sup par job.  Many times a barista staff will learn some basics for making coffee and espresso, but they get no in-depth context of how it relates to a coffee business operations system.  To put it simply, if it’s free, you are probably getting what you pay for.  Many coffee education programs such as the Texas Coffee School provide high-quality, ongoing training opportunities for coffee business owners and the entire barista staff.  These programs are an excellent way to quickly bring a group up to speed in not only fundamental coffee brewing skills, but in-depth understanding of the inner workings and execution of a successful specialty coffee program and operations system. These programs also offer confidence building and program refinement through ongoing training to ensure continual growth and development of skills.  Quality barista training is an absolute must if you want to better your odds for success!

Coffee Shop Menu 

Complicated menus are another common mistake made by new coffee shop operators.  It’s easy to want to please everyone and add every drink you’ve ever seen offered at any coffee shop.  This will only make your inventory more difficult to manage and confuse your customers.Think about whom you are trying to reach and what they will expect.  Where are you located?  Who lives around there?  Who shops there?It’s important to find a balance of what people want and expect while maintaining the integrity of the concept you have created.  By viewing what your target demographic wants through the lens of your own vision of great coffee and by keeping the menu limited, you will increase your chances of success.

Following Trends

Be genuine in creating your concept. Coffee can be a fickle industry at times in that new trends come in and out of fashion frequently.  These trends can be capitalized on to make a quick buck, and often are, however, when trends fall out of fashion, these businesses often get left behind.  

Create a genuine, simple, quality-focused program that fulfills your vision for the experience you are trying to create.

Coffee Shop Equipment

Let’s just make one thing clear from the get-go: coffee equipment is expensive.  High-quality coffee equipment can be very expensive.  There’s not really any way around this.  By trying to save a few bucks by purchasing less expensive and lower quality equipment you will limit the quality of your drinks dramatically, even if you’re using great coffee. In particular your espresso machine, grinders and brewing equipment should be carefully selected.Aside from performance, believe it or not, your equipment can actually have an impact on your brand image and the caliber of staffing you attract.  If you get bargain equipment or even used, tired looking equipment, it says something about your coffee program and the overall mindset of the coffee shop.  If you have high quality equipment that is well maintained it makes a statement that you are serious about coffee and you want to be the best of the best. (Please understand that just because you buy quality equipment it does not guarantee you will have great coffee.  To make an analogy: Just because you bought a Ferrari it doesn’t mean you will win the 24 hours of Daytona.  You must be a skilled driver too.  See tip 3 above.) Pro-tip: Grinders and water systems are often over-looked in favor of fancier espresso machines or brewers; however, your water system and grinder actually have the greatest impact of the quality of your drinks. Budget for a high-quality water system and grinder and you won’t regret it!

Pick a roaster whose coffee you love

Many new coffee shop operators quickly pick one coffee brand that they have come enjoyed drinking. This is a sensible place to start since it is important to offer a product you enjoy and can be proud to serve.That said, it is definitely in your best interest to sample some different roasters. There are lots of great roasters out there producing fantastic specialty coffees and many of them offer other services as well like equipment distribution, technician and warranty services on that equipment, etc. It’s important to pick a roaster whose coffee you love, who you can trust and whose services best accommodate your needs.

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