How to Start a Cafe

Business.com / Starting a Business / Last Modified: February 22, 2017

Starting a café is an incredibly popular option for someone who wants to start a business. Learn about finding the right space,...

Starting a café or a coffee shop is an incredibly popular option for someone who wants to start a business. Coffee consumption has increased 7% overall, moving coffee ahead of soft drinks, according to the National Coffee Association. Gourmet coffee consumption in particular has grown: in 2011, 25% of Americans claimed to have had a gourmet coffee in the past 24 hours, while in 2012 that number is 32%. Knowing how to start a café will help you figure out if you're ready to take on the challenge:

Finding the right space

Figure out if you want to rent or own. The biggest benefit to owning the actual café real estate is to have greater, more predictable control over the cost of the real estate as it contributes to your overhead. With leasing, your costs are controlled by the market, which may force owners to charge a higher amount as specified in your contract. There are pros and cons to both options, and you must weigh them carefully if you truly are in it for the long haul.

Commercial real estate is a much different beast than residential. It's important you work with a commercial broker whom you trust to help navigate the market and identify ideal properties, and a mortgage broker to help figure out what you will be able to afford. These experts will help you determine if the property is the right space for a café, whether it has the bones and necessary upgrades, or whether you need to consider working some negotiations into the offer.

Purchasing supplies

There are two types of "supplies" you need to consider: 1) the appliances, cookware, and necessary technical equipment that you'll need to (hopefully) purchase once or infrequently, and 2) the ingredients and perishable goods you'll be purchasing on an ongoing basis.

Coffee shop equipment

There are many places you can look for coffee shop equipment and supplies. First you'll want to get a sense of the largest items you'll need -- everything from refrigerators and freezers to pantry storage and display cases. List these items out and work your way down to the heavily used café supplies that will get more hands-on use -- this means coffee makers and carafes, mugs and saucers, espresso machines, spoons, airpots, and more.

To purchase this coffee shop equipment, you can look to a number of sources, from major restaurant supply chains to an appliance warehouse. You can even look online if you've done the right research and feel comfortable buying this equipment sight unseen. Online options and major appliance warehouses are likely to offer both new and used equipment.

Perishable food & coffee

You'll be ordering the proper food and beverage items for your café from multiple vendors every week, or perhaps more frequently than that. More than anything, it is crucial that you're working with companies and suppliers that you are comfortable with. If you work with companies solely based on price, you're likely setting yourself up for sacrifices in the way of customer service, quality, consistency, and flexibility. It's important you select your suppliers on quality of goods and customer service, as you'll work closely with these companies and want to be able to rely on them. You'll also want to try to find a vendor that can supply most, if not all, of the items you'll need to create your menu. Managing multiple vendors and multiple invoices can be taxing if you're not properly organized.

Determining what to order and when is also a huge part of successfully running a café. Figure out your inventory levels and speak with your suppliers to get a feel for what you should order to start. Soon after opening, you can use sales and trends in your usage to determine what your true order amounts can be on any given week.

Hiring Employees

Depending on the size of your business and your hours of operation, staffing your café will likely require the help of mostly part-time workers, but there are a number of questions to be answered before you begin recruiting: How many workers does your business need? What's the best way you should budget for hiring? Is it wise to staff many part-time workers or should you look to employ full-time workers as well? Can you afford health insurance and taxes associated with having a full-time staff?

You'll also need to have a solid idea of the types of skills you need in your employees. It would behoove you to look for candidates that have experience working in a coffee shop or food service setting, or you may look for employees who have strengths that you lack. Look for people that can positively resolve customer complaints, can move orders quickly, and work well under pressure.

Don't forget to look into the training necessary to become a successful coffee shop employee. This means creating and making new and interesting beverage combinations, and consistently preparing drinks and food items.

Announcing the opening

Once your menu is decided on, your operations are staffed up, your supplies are in order, your café is furnished, and you're feeling prepared to open the doors to the public, you'll want to get your café's name out and drum up excitement for your opening. This isn't something that should be done only when you're officially open -- you'll want to start spreading the word early on. Use the many resources at your fingertips to get your neighborhood and greater community excited about your offerings.

  • Use social media sites like Twitter, Facebook, and Foursquare to connect with customers in your area, and prepare to drive some foot traffic through these channels with special deals and incentives.
  • Get friendly with your local news reporters and influential bloggers, and let them know how your café differs from any others in the area.
  • You might consider doing some advertising at the onset, and either target new customers through Facebook, or offer customer coupons in your neighborhood flyers.

Photo source: austinbushphotography.com

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