Statistics show that, in Australia, the vast majority of newly opened cafés fail, with 70% closing within 12 months. What is more, the average term of ownership of a café is between 2 and 3 years, before they are sold on to the next owners.
Owning and running a café is a secret desire of many people – and it isn’t hard to understand why. Serving coffee and cake, and watching customers chat and relax from a hectic day of shopping, seems more fulfilling than any 9-5 office job.
There is a certain warmth to a café, but the image a café evokes can be very different to the truth. In fact, anyone who wants to run a café needs to be prepared for a battle for survival.
But for all the risks associated with the food and beverage industry, choosing to run a café can be a hugely rewarding undertaking, both financially and personally. So, what is needed to make your café a success? What are the pitfalls to avoid, and the advice to hold on to?
We’ve put together an 11-point guide on how to run a café, that should start you in the right direction.
1. Buy a Café Not a Dream
When first buying a café, there are no shortcuts to a good deal – and if any are taken, a serious price will be paid later on. Negotiations can have a litany of pitfalls, with most new café owners finding out later the asking price was hugely over-valued.
You need to list your priorities before choosing your new café and signing any kind of agreement. So, ignore the setting, appearance and interior décor, and keep emotions out of the deal completely. Trust us, emotion will turn your dream of owning and running a café into a complete nightmare.
Take a look at the café you have your eyes on and look at the numbers. Is it profitable? Is it in debt? Does it have its own regular guests? Do members of the staff quit too often? All those details are much more important than the colour patterns and the furniture choice. After all, you can always easily rent your table linen including wipes, napkins and tea towels.
Food & Glass Wipes
Reusable, environmentally friendly food & glass wipes. All HACCP compliant. See all available styles.
Highly absorbent and useful tea-towels. Pick the size and style that match your café theme. Learn more…
Crisp clean and beautiful napkins and tablecloths. Find the perfect style for you. Ask us for more colours and designs.
New details like this can drastically improve the appearance of your café and add your personal touch to it. It is far easier to make these little tweaks than to get the entirely new business running and pull it out of a debt. Therefore, choose wisely, so you can avoid the problems in the future.
2. Create a Business Plan
It is essential that a realistic business plan is developed before buying a café . Map out the intended course of action for both marketing and running the café, and refer to them continuously. And remember, it is impossible to secure funding without one – banks and investors need to examine it before making a decision.
— Posist (@Posist) January 18, 2018
This is the only way you truly get to enjoy running your establishment. You can hardly enjoy your lovely fresh coffee blend and your cozy interior if you have no idea where your business is heading. You need to know how much do you plan on spending, how much do you expect to earn, if there is any room for expanding your business and many details more.
3. Cross all the T’s
Another obvious step, but worth repeating, is the need to put all the legal issues in order. Before starting to run a café, don’t dilly-dally when seeking business permits, food and beverage licenses, and insurance of all kinds. Here are some pointers you should definitely take:
- Apply for the Food Business Licence with your local authority because the application process varies from one state to another. Contact your local government to check the requirements.
- In order to serve alcohol, you need to contact your local Office of Liquor and Gaming Regulation and ask them about the requirements for the necessary permits.
- It is necessary to make sure your food is properly handled and stored. You need to comply with the Food Safety Regulations.
- This means you need to make sure that your establishment meets all the criteria when it comes to safety and hygiene. This applies to both your staff uniforms, kitchen and even washroom.
- It is important to keep up to date and the best way to do so is to explore The Australian Specialty Coffee Association (ASCA) and Australian Coffee Traders Association Inc (ACTA)
These are just some of the legislations and acts you should be aware of. For more precise information, contact your local authorities as these can be different across Australia.
4. Follow a Theme
It’s easy to provide the safe, usual and run-of-the-mill, but let’s face it – your café is not going to be talked about much. A theme helps a café to stand out against the local competition, but it should run through the menu as much as the interior décor.
If you are not a stranger to eccentricities, you may enjoy these themed cafés from Bangkok. Some of them may even give you some interesting ideas or even inspire you.
Additionally, your theme doesn’t have to be an expensive one. You can stay consistent to it simply by choosing certain wall art or decorate your interior in a certain colour. On the other hand, if you want your interior to be your number one attraction, you may want to set the budget for it.
5. Be Professional at all Times
Professionalism in both image and attitude is essential if you want to run a café successfully. Spend time properly training your staff, make sure they know how to handle every situation, insist on the highest presentation standards, have attractive menus, and a website that visitors find informative.
One of the ways to add to that professional appearance is to introduce uniforms for your baristas and waiters. Just a simple T shirt and a nice apron will do. This simple move works double fold.
Firstly, crisp clean uniforms with a logo demonstrate that you have gone that extra mile to show you are serious about your business. Secondly, there are studies that claim that people act more professionally and diligently when they are wearing an uniform.
The best part is, you can rent uniforms and have them professionally cleaned regularly. This facilitates this process drastically for you and you have one worry less on your mind.
Wait Staff Uniform
Regular washed, replaced and delivered uniforms. Comes in different styles, sizes and fits. View our full range…
Wait Staff Pants
Elegant and classy mens’ waiter pants with flat front. Angled pockets and belt loops. Ask us for more details…
Wait Staff Aprons
High-quality, durable and presentable wait staff aprons in two sizes. Come in different styles. Learn more…
6. Swap Shoes with Your Customers
Not literally of course, but figuratively. Consider your customers’ experience and what they would expect from your café. Looking at your service, menus and facilities through their eyes provides an honest evaluation, often revealing where the cracks lie.
However, you may not be the most objective person to review your own café. After all, you put in all your money, effort and imagination in creating it. Therefore, another idea is to ask a friend, acquaintance or even a relative to visit your place and try to review it.
They need to know their honesty is important and that there will be no hard feelings. Choose somebody whom you trust and whose taste and opinion you value highly.
7. Keep Your Instructions Simple
Consider your staff, and how important clear communication is with them. A key to effectively running a café is ensuring no confusion. Policy inconsistencies are a key contributor to confusion, and in a café, this inconsistency can frustrate customers. So, develop clear procedures and make sure your staff understand them.
Managing a staff of three or four employees is easier than managing a staff of 15. The more employees you have, the more space for misunderstandings there is. As your business grows, consider taking some of the management courses that will help you learn how to communicate with your employees, lead them, train them and mentor them.
8. Make Your Suppliers Your Friends
It sounds a little soppy, but it is true. Developing positive relationships with your suppliers and distributors means they will look after you, especially when emergency orders are placed. If your café is a success, you’ll be surprised how often those emergencies crop up.
For example, you may have already completed your order for a week when you have an unexpected event on Wednesday which means you will probably spend more drinks and food than you intended. Therefore, you are in danger of welcoming a weekend with insufficient stocks.
If you have an excellent relationship with your supplier, they will probably do you a favour and help you replenish your kitchen in time. However, since it is all their good will, unless the contract says differently, building this relationship is important.
On the other hand, some suppliers offer adjustable deals since they know how fluid the business can be. For example, if you opt for a managed rental service for your table linen, a busy December doesn’t have to mean you’ll have a busy January. Adjustable service has you covered.
The table linen includes tablecloths, but also napkins that add class and that feel of quality. See more…
Highly absorbent, perfectly cleaned, bacteria-free tea towels, essential to any respectable café. Learn more…
Food & Glass Wipes
We rent multi-purpose, colour coded wipes that help avoid mistakes and prevent health hazards. See available styles…
9. Don’t Be Afraid to Change
Experience has taught those who run a café never to be afraid to make changes. In fact, a café is a fluid business that must adapt to the tastes and preferences of the existing market as they develop. Flavour of the month really can mean flavour ‘of the month’, so be prepared to alter your menu regularly.
Some of the coffee trends to expect in 2018, for example include:
- Serving latte in latte bowls
- Coffee based drinks safe for younger audiences
- Direct trade coffee
- Creative coffee drinks (nitro coffee)
Always keep your eye on the newest and the latest trends. It is advisable to stay active on the social media and follow the trendsetters around the world. Another way is to regularly visit conventions, fairs and expos in your industry.
10. Never Stop Marketing
A major challenge when running a café is to stay popular, but no matter how adventurous your menus are, or great your coffee is, nobody can rely solely on word-of-mouth. People who already run a café will testify that marketing is the heaviest weapon in their armory.
This includes flyers, posters and the normal advertising channels, but mastering the potential online and social media has to offer is essential too. Online marketing is becoming increasingly important. It stopped being an additional marketing effort ages ago and became a necessity.
Learn what you can on your own and when it starts taking up too much of your time, hire a professional to manage your social media accounts. Here are just some of the things you need to do:
- Make a well-designed website
- Create accounts on Facebook, Instagram, Pinterest and Twitter
- Use hashtags and create your own
- Enable check-ins at your café
- Contact bloggers and influencers and offer freebies in exchange for reviews
- Diligently deal with negative online reviews
11. Groom a Group Of Regulars
Your relationship with suppliers is important, but your relationship with your customers – and developing a group of regulars – is perhaps more so. This is where loyalty programs can be of great value.
The incentives received as a loyal customer are proven to keep people returning, and a simple card-stamp system can work perfectly.
Other ways of appreciation can include reserving their favourite seat for them, remembering their birthday, always making sure they have their favourite drink ready for them and similar. Treat those people like friends and make others wish for the same privileges as your loyal customers have.
How Can Alsco Help?
Alsco provides convenient and economical solutions for maintaining the highest linen standards for your business. Our fully managed tea towel rental service is no exception: we provide quality fabrics, sizes and colours with no up-front capital outlay; regular pick-up and delivery; and a flexible inventory management system.
However, tea-towels are not the only product that you may find useful for your business. How about perfectly washed and ironed staff uniforms? What about fully managed washroom service which means you never run out of toiletries?
Improve your café today by contacting Alsco representatives. They will let you know about all the ways we can help you. Also, they will workout the best deal for your business.Photo courtesy of Flickr Images by Alpha