The planning of a new café or restaurant is quite intense and covers a myriad of areas. There are literally thousands of decisions to be made about site selection, lease negotiation, compliance approvals, business name, logo & colours, fitout/ergonomics, equipment/furnishing selection, utensils/crockery, packaging selection, product assortment, pricing strategy, supplier selection, staffing plans, advertising and opening day plans. I talk about the whole sequential process in doing this here: How do I start a coffee shop?
If you’re looking for why cafes fail you might want to read about my thoughts and opinions here: Why do most café startups fail? or if you want to know what I think makes for a successful café you can check out my answer here: What’s the secret to a successful coffee shop?
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With so much to consider and decide on with limited previous experience and within quite tight time-frames and constraining budgets, is it any wonder that people often forget about or mess up some of the important aspects in the planning of a café or restaurant. I’m not so sure what the common things are that people mess up but having started many cafes and restaurants myself, here are the things that I messed up in the planning of some of them, grouped by those areas mentioned earlier.
- Selecting a highly visible, high-traffic, high-rent location rather than selecting a less visible but easily accessible destination drawing location.
- Not considering the service utilities before choosing the site. i.e. sufficient electricity supply, access to adequate trade waste facilities, access to staff/customer toilets, air-conditioning supply, existing or easy-to-install kitchen ventilation (if required).
- Choosing an inappropriate shaped premises making it difficult to build a profitable business (i.e too narrow for traffic flow, too big/expensive or difficult to use much of the space due to unusual floor plan configuration or obstructions)
- Not securing a rent free fit out period.
- Not securing a long enough tenure with renewal options periods to allow capital gains and goodwill when you on-sell.
- Trying to negotiate the rent down rather than paying the landlord’s rental price but getting far more from the landlord in contribution to the fit out in areas like lease improvements that you need to operate but you can’t take with you when you leave. (i.e. air-conditioning, ceilings, fire protection systems)
- Relying too heavily on expensive consultants rather than discussing issues directly with the relevant statutory authority.
- Failing to engage with the statutorily authorities early in the fit out process to clarify ambiguities and to allow the time they need to carry out their due diligence. (Their delayed approval can hold up your opening – big time)
- Not realizing that while costly and time delaying at the start, food business compliance is designed to protect your business in the long term with safe food handling practices for your customers, safety at work practices for your staff and ensuring easy cleaning and maintenance of your equipment and premises.
Business, name logo & colours
- Thinking that your shop colours need to be your logo colours.
- Not starting with a 4-5 letter name that ends in an “s” because that is what your customers will call your coffee shop or restaurant eventually anyway.
- Not getting the rights to your name early before you start to trade i.e. domain name, registered business name, trademark.
- Overspending on a ‘state of the art’ kitchen and then under spending on the front of house area where the customer actually engages.
- Not considering the waste operations in the planning (location of rubbish bins in the premise, storage of rubbish outside of the premise and waste pickup arrangements)
- Not considering the equipment maintenance arrangement in the installation particularly in relation to easy access to high maintenance refrigeration motors and condensers.
- Not investing in the more expensive but vital for great coffee – quality commercial conical grinder.
- Over-investing in the brand/size of an espresso machine thinking that it is the secret to great coffee. A 2-group espresso machine will handle most coffee shops doing up to 20 klo per week and any Italian designed espresso machine with a standard E-61 group in the hands of an expert barista will still make great coffee.
- Choosing furnishings only for their fashionable appearance rather than the more important issues in high traffic coffee shops – long term wear n’ tear and easy maintenance.
- Not choosing a vitrified ceramic cup that stacks easily on the top of the espresso machine
- Not choosing saucers with deep enough centres that hold the cups firmly in the service delivery
- Not investing in quality tools and utensils. Believe me, whatever you save in price will cost you ten times that amount in unproductive wages and poor morale.
- Not selecting a take-away coffee cup that easily identifies it as coming from your business and is different to your competitors. If you can afford it – add your own logo on the cups.
- Selecting the cheaper polyurethane cups rather than the more market acceptable but more expensive insulated paper cups.
- Not providing a self-service space for customers to do just that – i.e. condiments, lids, stirrers, additives.
- Trying to offer too much too early rather than just starting with the basics and building the assortment from there, according to customer demand
- Not realizing that a choice of three in any range is enough to build and maintain a loyal customer base without overly confusing them (i.e small, medium, large – cheap, popular, luxury – strawberry, chocolate, caramel)
- Not making your quality coffee, rather than your food, central to building your repeating customer base and profitability.
- Not building in a price changing mechanisms into the menu board or price displaying system at the outset
- Not clearly identifying and time-framing introductory discounts that make it hard to change once the customer gets accustomed to the discounted price.
- Not creating some high-priced reference pricing or utilizing decoy pricing.
- Choosing the cheapest supplier rather than the most reliable.
- Letting your suppliers determine your product offer through the supply of equipment (fridge/coffee machine) rather than determining your business offer base on your customer’s needs.
- Failing to realize that your suppliers are your real partners in this business and not treating them accordingly.
- Not realizing that the staff that start with you and see you at your weakest, rarely translate into respectful and value-adding staff once your business is established.
- Not realizing that you need to over-staff at the start to create a favourable impression with customers that you hope will become repeating and referring customers.
- Hiring skills rather than attitude. (attitude = keen to learn + keen to help others + grateful for the opportunity)
- Not having a coffee loyalty system (buy 7 get the 8th free) in place to build and maintain your customer base.
- Not realizing that your best advertising is your customers talking to others about the exceptional experience they had when engaging with your business.
- Not using outdoor seating and tables as one of the best attractions for new customers to locate your business … particularly if there is a visible Coke logo. The Coke logo is a universal sign for a food business, so use it.
Opening day plans
- Locking yourself into a specific opening day without consideration as to whether your business is ready to give the best first-impression possible to your potential long-term customers.
- Not realizing that opening day is ‘make happy customers’ day not ‘make lots of profit’ day.
- Not previously opening your coffee shop in a trial with your non-customers first (Saturday, Sunday, nights)
- Linking your opening day to the first rent paying day. You may simply need to add a week or two’s rent to your fitout budget rather than open all stressed and half finished on the first rent paying day.Remember, the old adage that ‘your only get one chance to make a first impression’ is never so apt as when opening a new business.
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Other insights about coffee and coffee shops are available in the other answers I have given here on Quora: What you should know about coffee and cafes.