How to know if my shop will make it?

[hoppy]

I have been running a coffee shop for 18 months now. We have a great roaster and many regular customers, but things are not picking up. We are located in a small midwest town. Could someone tell me when to know that you will not succeed?

I would appreciate some feed back from successful drive thru coffee shop owners.

Thanks

 

[cafemakers]

12-18 months should be a reasonable amount of time to establish brand recognition and steady stream of routine clientele; if you are not yet reaching your projected financial goals, you will likely need to make adjustments to your business model or products.

Andrew

 

[lauralanyon14]

Works great! Thank you for posting this.

 

[nagesh]

Tips to improve Coffee shop profits:
Reduce flavoring inventory – Excess flavoring inventory ties up capital in your stock, requires valuable floor back room space for storage and slows the customer ordering process. Prune your flavor offering to the best performing 4-6 varieties, including sugar free offerings.

Prepaid gift card program – Prepaid gift cards not only provide your business with immediate cash-in-hand, but also reduce credit card transaction charges and draw new customers to the business. EVERY retailer should offer a prepaid gift card program, networked to all company locations and ideally, also valid for on-line purchases.

Discontinue coupons and discounts – the most valuable customer demographic of daily coffee consumers are not influenced by discount programs or coupons, only infrequent drinkers or “opportunists” are swayed by the chance to save $.50 on “Discount Tuesdays.” Focus instead on promotions that draw customers to your retail location rather than discounting products.

Control waste and theft – audit sales and inventory reports to evaluate ingredient waste due to inefficient preparation, returned drinks and employee consumption. Retail locations can easily waste 20% or more of their daily sales these three key categories, which is a substantial and unnecessary loss.

Evaluate hours of operation – There is no need to be open during business hours when there is regularly no customer traffic. If, for example, Sundays are traditionally slow days for your business, trim your hours of operation for that day or remain closed. Be certain that your lease allows you this flexibility prior to signing, as many shopping center leases require that a business remain open during scheduled hours.

Eliminate bottlenecks in the ordering process – There is nothing more frustrating for a brewed coffee drinker than to wait in a long line of “double-non-fat-vanilla-chai latte – wait, make that half-caf” customers. Create a separate ordering line or other mechanism for quick orders, such as drip coffee, grab & go food items or whole bean retail bags. Evaluate the ordering process to find opportunities to avoid duplication, speed payment and beverage delivery to get more business through your tills during peak times.

Position add-ons and promotions at the point of purchase – As with the menu tips above, be sure that your current sales promotions are visibly advertised at the point of sale. Be sure to promote add-on impulse items that support your company’s brand image (even those gift cards!) when your customer is standing with wallet in hand.

Run employee sales contests – Your baristas are your salespeople and have a great deal of influence over the customer ordering process. All baristas should have some form of sales and customer service training to make each transaction active, rather than passive. Sales contests that emphasize high margin items or cross selling can be designed to be fun and engaging for all of your staff and will yield substantial financial results.

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