Why a Hybrid Coffee Shop Model?
In today’s competitive market, the traditional coffee shop faces challenges. Rising costs and market saturation in some areas are a few that jump to the top of the list. In fact, we just shared how inflation affects coffee shops and why a hybrid coffee shop model could be the answer.
The status quo may not cut it anymore for small businesses. The formula to modern success? Increasing the number of transactions + increasing the dollar amount of the average transaction. Innovative shops are attracting more customers and adding new streams of revenue. This is the future of coffee shops—a way to generate more revenue every hour of the business day.
You can innovate your coffee shop to grow revenue—and you don’t have to do it alone.
How to Add Another Stream of Revenue
Earning more revenue takes more than just adding food to the menu. (In fact, if not managed extremely well, food/ingredient waste can actually cause more harm than good to a coffee shop’s bottom line.) It’s offering a new experience to customers. A successful new revenue stream increases the size of transactions and brings in more traffic.
Compare a traditional coffee shop to a bar. Most coffee shop customers only buy one drink per person during a visit. Meanwhile, a bar can sell two to three drinks to a single customer per visit. Plus, bars tend to draw crowds, which equals more of those high-dollar transactions. While we’re not suggesting your coffee shop should become a bar—although you could serve alcoholic beverages—there are ways to bring your coffee shop the same success.
Coffee sales have high profit margins, but also high overhead expenses. Adding another stream of revenue, or adding a coffee program to an existing business, is a way to offset expenses. We’ve seen:
- coffee + antiques
- coffee + motorcycles
- coffee + sno cones
- coffee + bicycle shop
- coffee + beer brewery & tap room
- coffee + food and wine
- coffee + surf shop
- coffee + bible shop/Christian events center
- coffee + record shop
- coffee + barber shops
- mobile coffee + floral arrangements
- coffee + fashion boutique
- coffee + BBQ
- coffee + gym
It might also help your profitability if coffee isn’t the primary product, but is equally balanced with another revenue stream, or even supplementary.
Examples of Hybrid Coffee Shop Models
Let’s take a deeper look at several businesses getting ahead of the game with their hybrid model.
Desert Oak Barbecue
Desert Oak Barbecue is a family-owned BBQ and coffee business located in El Paso, Texas. Birthed out of a desire to make great brisket, the restaurant started as a food truck in 2015. Its growing popularity led to the first brick-and-mortar location in 2017. Since then, they’ve been named in the Top 50 Texas BBQ Joints for 2021 by Texas Monthly and featured on Diners, Drive-ins, and Dives.
The restaurant has introduced a coffee and breakfast drive-thru to both locations, much to the delight of their customers. Named a “match made in heaven,” their coffee and barbecue menu offer everything from burgers and pulled pork to lattes.
Galindo’s Barbershop + Coffee Co
Galindo’s Barbershop is a highly rated barbershop located in Conroe, Magnolia, and The Woodlands, Texas. Their team of professionals specializes in all hair textures. Plus—they sell coffee.
Galindo’s Coffee Co serves the Conroe location with craft coffee, organic tea, and local bites. Dubbed “a fresh take on the modern coffee shop,” the space makes it easy to sip coffee while you’re in the barber’s chair. Plus, folks who are simply looking for a great cup of coffee can learn about a new place to get their hair cut.
But wait, there’s more! The brand also offers Galindo Aesthetics services. If you need a facial, lashes, or massage, you can find it next to the Conroe barbershop and coffee shop.
Zavala’s Barbecue + Mas Coffee Co
The coffee shop came to life in 2019, serving coffee and breakfast tacos (made with brisket, obviously). The two different formats make it possible for the businesses to serve customers from morning till night.
Pop’s Garage Fabrication + Coffee Co
Pop’s Coffee Co is a neighboring business to Pop’s Garage Fabrication, a motorcycle repair and fabrication shop in Roswell, Georgia. When the space next door opened up, the owners of Pop’s Garage decided to buy it.
After attending Texas Coffee School’s 3-Day Coffee Business Class, the duo opened a highly successful coffee shop. The shop broke even after the first month of business and averaged 250 customers per day in the coffee shop. They also offer a hearty food menu.
We’re always adding new class dates for Coffeepreneurs® to learn how to succeed in the coffee industry.
Lo Melinda’s Buzz and Bloom
Whether you want an espresso or a flower bouquet, Lo Melinda’s has something for you. The coffee and flower truck is located in Loma Linda, California, just outside of Loma Linda University Campus.
In addition to serving coffee, Lo Melinda’s lets you build your own floral arrangement or buy a custom bouquet. Their mission? To inspire joy and spread warmth, one cup and one bloom at a time.
Chicken N Pickle
In Grand Prairie or San Antonio, Texas, you can sip a beer, cocktail, or coffee while playing games like pickleball or ping pong. Plus, you can eat plenty of chicken. Chicken N Pickle has six locations in the U.S., with three more cities in the works.
The business uses an interesting concept: selling time. They attract customers who want to spend an afternoon playing games with their friends—all while keeping them fed and armed with drinks. And the Coffee Shack offers a caffeine boost so you can play all day.
A Hybrid Model Could Help Your Cafe Thrive
Hopefully, these examples have you thinking of ways to incorporate new revenue streams into your coffee business. Or, maybe, it’s the other way around—you have a small business model that would benefit from coffee services.
However you “hybridize” your business, we can’t wait to see what it becomes. The market needs more ingenuity, and customers always need more coffee.