Coffee is one of the most popular beverages in the world, with over 400 billion cups consumed each year. In the U.S. alone, the average coffee drinker consumes 2.7 cups per day. These statistics show just how reliant people are on coffee and as a result, why there’s a need for more coffee shops.
Even though coffee is a commodity, not all coffee is of good quality. If you’re thinking about when and how to start a coffee shop, consider sourcing your beans from quality suppliers. Coffee drinkers are becoming pickier and pickier, so you need to meet their needs and taste.
Keep reading to learn 9 steps for opening a coffee shop that’ll set you up for success.
1. Write a Business Plan
The first and most important thing to do before opening a coffee shop is to write a business plan. This is important if you’re going to banks and investors for funding, but also for yourself to help you stay on track with your goals.
A business plan should have all the details related to your business for at least six months. Write down your target market, monthly financial and other goals, budgets, inventory, employees, equipment, marketing activities, vision and mission, expenses, revenue projections, and resources.
Your plan should also include tasks and assignments of employees, plans about repairing an espresso machine, and solutions for emergency situations. You can adjust the plan as you go but in the beginning, it’ll keep you accountable and help you stay focused.
2. Research Your Competitors
There are hundreds of thousands of coffee shops in North America, so you’ll have strong competition. This doesn’t mean you can’t make it, it just means you need to research it well so you know how to stand out.
Start by analyzing your local competitors and see what their customers like and don’t like. Go to their websites, social media profiles, and even visit their coffee shops to see what they offer. This doesn’t mean you should copy them, but knowing how they run their business can help you find ways to be better.
3. Do Market Research
Even though coffee is one of the most popular beverages in the world, not all coffee shops make it. This is not because there’s no need for more coffee, it’s because they either didn’t know how to start a cafe or didn’t do market research.
You can either hire a company to do the market research for you or you can try and do it yourself. For instance, try to make connections with people in the industry and talk to them about the coffee business. Talk to customers in coffee shops and ask them questions about their favorite places. Talk to coffee roasters and baristas to learn more about their day-to-day activities.
4. Find the Best Coffee Suppliers
Finding the best coffee to serve to your customers is one of the most important parts of figuring out how to open a coffee shop. Are you going for specialty coffee that’s sourced through fair trade and from organic farmers? Or do you want to serve different types of coffee to suit all tastes? Will you be using a coffee supplier or will go directly to the farmers and get the coffee from them?
The quality of your coffee and how good you make it is an important factor in finding loyal customers. Especially if you want to attract true coffee aficionados who can recognize good coffee from miles away. Learn about coffee and the manufacturing process as much as possible before you open a cafe.
5. Get the Equipment and Furniture
Now it’s time to get the equipment and furniture for your coffee shop and turn your vision into a reality. How the coffee shop looks inside is an important factor for comfort and atmosphere. Make sure there’s plenty of seating available and that people can move freely without cramming into each other.
Place the barista area away from the door, and add decorations, soothing playlists, plenty of lighting, greenery, and wall decor to make the place more cozy and welcoming.
6. Create a Marketing Strategy
Creating a marketing strategy to promote your coffee shop is essential in spreading the word. Print out flyers, business cards, and brochures to hand out to people on the street.
Start posting social media ads at least a month before you open to get people interested. Tell everyone you know that you’re opening a cafe. Pay for radio and TV commercials, billboards, or bus advertising. Anything to create buzz around your cafe before you open is worth doing.
7. Obtain the Necessary Licenses and Permits
Since a coffee shop is essentially a food and drinks business, you’ll need to obtain all the necessary permits and licenses from your local, state, and national authorities. Contact your local business departments to help you figure out what types of permits you’ll need.
You’ll also need to register a company, file for trademarks if needed, and get an Employer Identification Number (EIN).
8. Post Job Ads and Start Interviewing
Running a cafe is not a one-person job, so you’ll probably need to hire staff. The most essential employees you’ll need right away include:
- General manager
Make sure you hire experienced and skilled people for each job position if you want your business to take off.
9. Throw a Grand Opening Party
The final step is throwing a grand opening party and invite everyone you know! Spread the word on social media and hand out invitations to people. Provide free coffee and snacks, offer discounts and daily specials, and enjoy your first day as a coffee shop owner.
Now You Know How to Start a Coffee Shop from Scratch
Now that you know how to start a coffee shop, it’s time to take action and make your dream a reality. Start with a business plan and a clear vision of what you want your cafe to be. Then, find the best coffee suppliers and turn your coffee shop into an experience.
Want more tips on business and entrepreneurship? Check out the other articles we’ve written on these topics and stay tuned for more recent trends and updates.