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Is opening a Coffee Shop a good idea ?

Discussion in 'Ideas, Needs, Concept Feedback' started by AlessioLC, Jul 19, 2017.

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  1. AlessioLC
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    AlessioLC Bronze Contributor Read Millionaire Fastlane I've Read UNSCRIPTED Speedway Pass

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    Hi guys,

    I've recently introduced myself on that forum and i was wondering what's your thought on Coffee Shop, is it scalable or is it a dead end and a direct way to the slowlane ?

    I've been a Barista for 4 years now, i know everything about coffee history and coffee industry, i'm a manager in a Coffee Shop and i run it besides the owner (my parents own it) so i know everything about how to manager suppliers, H.R, Financial ressources and everything who goes with it (Communication, Social, Events)

    I deeply think that opening a Coffee Shop is too simple and that if it's too simple, everyone can copy it and maybe do better than me, and if that happen', i would be kind of stuck..
    Everything i see on this forum is about bringing value to people, got no expectations from anyone, i've already got that mindset as my parents taught me it all my childhood but i'm stuck with that idea that Coffee Shop was scalable at the time where Starbucks wasn't on the French Market but market is kind of full with Starbucks who's opening like EVERYWHERE.

    I could bring value in this domain because i got the knowledge and i care about my customers, my team, as much as i care about my product and quality, even if speed is the assets...but everywhere i go (coffee shop), i don't see creativity, i don't see quality, you got my point..The Sugar Franchise..Starbucks!

    The only thing is, i want to create a business that can be franchisable, not that i care only about money, but money can buy your new parents house in the seaside, that's my motivation...

    What's your thought on that ? Any suggestions ?
    I'm good at what's from italian culture so if you got an idea(coffee,cooking,pizzas...), don't hesitate.

    Thank you for taking the time to read ;)
     
  2. Millenial_Kid5K1
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    Millenial_Kid5K1 Bronze Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass

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    I see a lot of 'I' 'Me' and 'My' in your question. Does the area you're looking at need another coffee shop? Do you have some unique value that would differentiate your coffee shop from the other coffee shops near you? Do you have something so unique, different, and valuable that someone would want to franchise it instead of franchising a proven brand(Starbucks)? If not, I'd avoid opening a coffee shop.
     
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  3. minivanman
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  4. loop101
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    loop101 Silver Contributor Read Millionaire Fastlane I've Read UNSCRIPTED Speedway Pass

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    Maybe I'm missing something here, but why don't your parents just open another coffee shop? And then another, and another, etc. You could be the manager of the coffee shop chain. Maybe one day you would be the owner of the coffee shop chain.
     
  5. MJ DeMarco
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    I don't understand why this is so difficult, because it truly isn't.

    Circumstances dictate the answer: Is there a need for a coffee shop?

    Circumstances: There's a fire and the window is your only escape. Do you need to jump out a window?
     
  6. JAJT
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    There are lots of absolutely huge chain coffee shops. Clearly it's a good idea. People pay for coffee every day.

    It comes down to value/offer and execution.

    That being said - it depends what you are trying to do. If you think you are going to be a "better starbucks" I would argue you are likely kidding yourself unless you have a damn good reason to think you can outcompete them.

    Now, if you said you wanted to offer automated coffee kiosks that don't suck - that's interesting.
    Or a cold coffee shop that ONLY does cold coffee products - that's interesting.
    Or if you focus on in-store-roasted, small batch, hand selected, etc... (the "small/local" angle) - that's interesting.
    Do you have some location in mind that none of the other big guys have thought of yet - that's interesting.

    You need a reason for people to choose you over someone else. Coffee is everywhere. Why are they choosing you over the places they already go to and are familiar with?
     
  7. AlessioLC
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    AlessioLC Bronze Contributor Read Millionaire Fastlane I've Read UNSCRIPTED Speedway Pass

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    Where i want to open my Coffee Shop, the needs for a new one is real, i've been asking friends who live in the city so the question have been studied earlier with these guys. I will bring value because i will bring new drinks and products that don't seems to exists in this area and even on the market (not every product for sure but a part of it).

    A lot of guys that started Coffee Shop had no clue on how to run it, don't know a thing about finance and how to manage it, they just survive as much as they can because they add product to their range even if they got no marges on them, just because it's cool. But cool doesn't get you to pay the bills, that's why a lot of them don't survive.

    Many are using modern machines but me, i will use vintage machines because that bring authenticity as much as my identity/personnality, the machine that i want to get is a special machine used in the first coffee shop and is difficult to use and need real techniques, that's mean that not everybody can use them so I will differentiate myself.

    Where all coffee franchise here want you to get ready to put 400K on the table and with an obligation to open 3 new Coffee Shops in 5 years, i would simply get my royalties (4% > very low rates and attractive) and 300k to start the business, with that the authenticity of the concept.

    It's hard to translate my thought on words as i'm French but i think you get my point.
    As said, don't hesitate and give me your thought on that.
     
    Last edited: Jul 19, 2017
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  8. garyjsmith
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    You should be selling shovels.

    Do you roast?
     
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  9. AlessioLC
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    AlessioLC Bronze Contributor Read Millionaire Fastlane I've Read UNSCRIPTED Speedway Pass

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    I also want to bring my culture (i'm Italian) in that concept
     
    Last edited: Jul 19, 2017
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  10. MarekvBeek
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    Maybe there are a lot of people who don't like the "American Coffee". Bring your traditional French taste, tradition and ambiance and you might have a concept. "Café et macaron ou tarte tatin"

    "Now franchise the damn thing."

    Or do what loop101 suggests, open another coffee shop, the same as your parents have. And another, and another.

    Keep us updated

    EDIT: Mix it with your Italian style (If there is a NEED)
     
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  11. AlessioLC
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    I've been thinking about that idea, but i think opening a new concept is way more rewarding and if it work, i can after that buy a roaster machine and begin to roast my own coffee and sell it..
     
  12. AllenCrawley
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  13. AlessioLC
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    That's exactly the idea, every person that i know don't love Starbucks and that's why Starbucks don't work that much here, excepted in Paris where there literally a shop in every corner...
    That's why i'm telling Authenticity is my assets
     
  14. Millenial_Kid5K1
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    Huh? I thought roasting your own beans was pretty much status quo for coffee shops? Hell, I roast my own beans at home with an old popcorn popper.
     
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  15. AlessioLC
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    We're already are in a coffee franchise, but we don't own it, and we're actually not allowed to change every got damn thing in there, can't change the coffee supplier, can't change the design...that's why i want to create my own business from my idea, i got creativity and i'm stuck with this actual franchise so i want to move on and create mine.

    btw, the guys who are running the franchise are old and IMO, they will give the franchise management to their childrens, who don't know a single THING about coffee > bankrupts.... so this is an opportunity here for us, but in how many times ? i can't lose that time
     
    Last edited: Jul 19, 2017
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  16. AlessioLC
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    True, but only when you're activity is stable and you can focus on roasting your own coffee.
    Those who do that in Paris have been opened for 10 years and only been roasting their coffee for 2-3 years because they needed to get something stable.
     
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    Well be careful with that. I love your enthousiasm. And I'm just brainstorming with you.

    I mean... You and I might think there is a need, and it could be that we are the only two persons on earth. Like @Millenial_Kid5K1 says, you have to know what unique value you offer and if it fulfills a need. There are literally 10.000's coffee shops.

    People say they didn't like the National Enquirer, but the printing machine said something different.

    Do your due dillegence!

    Good luck with it.
     
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  18. cutthroughstatic
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    Lots of people want to open their own coffee shop. Lots of people fail in business, specifically in the coffee business. Like others have said, how will you provide massive and unique value?

    If your vision is scale, roasting your own coffee seems like a good path.

    Are you pursuing this business because it seems easy (because you have some background in it?) or because you truly see a need and want to fill it?
     
  19. AlessioLC
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    I know that, but how can you know if you're gonna win or lose..i think the only solution is to try and see, but that's risky.
    I really think i would add value and fullfills a need, but not in any city (if i franchise).
    Like, in some city people do what i want to do, but they don't have the personnality behind it, don't have an attractive concept nor design and people get bored of it.

    I really think i got something who will get my clients back everytime
     
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  20. AlessioLC
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    I don't want to let public my concept because i've seen that french people are suscribed in this forum so you got me on that, but it's related on my italian culture, and that can bring value to the domain and people, as their searching for that kind of coffee places, because at that time when american coffee style is everywhere, i want to bring something different to the market (again related to my italian culture).

    If you want to talk real scale, the real thing would be kind of E-Com coffee supplier, like supplying coffee from every country, but again Coffee is not like Wine, the older it gets, the less flavours you got so i think this is not viable.
    Roasting my own Coffee would be a great idea as the Coffee Shop market start to get some height here.

    To be honest, both, because i've been working in for years and managing one of them, but i truly see a need in the domain and i want to take that opportunity
     
  21. cutthroughstatic
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    Hopefully it's not related to the Italian culture of sitting and sipping coffee/taking lunch for like, two hours. This would severely hurt your turn!

    But for real, a question. How do Italian restaurants do it? I don't know if this is a real thing or not, but I heard that meals in Italy are generally a two hour event. Maybe that's just folklore, I don't know. But I just picture the restaurant owners being like, okay, time to move on, I need to make some more money with this table
     
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  22. AlessioLC
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    AlessioLC Bronze Contributor Read Millionaire Fastlane I've Read UNSCRIPTED Speedway Pass

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    Back then yep it was like that, but they have understood that getting 20 people for the day would not pay the bill, so now they start to ask people to move when they finish, so they can get more clients.

    But this is real like, when i go see my family in Italy, we eat all day long, from 1pm to 3/4pm some times...but not in restaurants.

    But no, it's not like that anymore haha !
     
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  23. cutthroughstatic
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    Damn. I was hoping to visit Italy one day and sit and eat some pizza for a few hours. I guess capitalism DOES ruin everything... :playful:
     
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  24. TheDillon__
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    I don't want this comment to get overlooked.

    Third wave coffee is all over the place. Even when I was living in the suburbs, there were 5-10 different shops all within half an hour of me that all had different vibes, a slew of different equipment, and different offerings.

    Essentially, everyone's got coffee. You have to be different.

    People are slowly starting to become more educated about pour-overs, siphons, vacuum presses, french presses, all of this good stuff. If you have some new equipment that you can bring to the table in order to get people to pay $5+/cup, you're off to a good start.

    ----

    If I can think of a few things you'll want to keep in mind, it's the following.

    1. Brand Identity

    Who is your target customer? What do they like to do? How do they spend their time? Are they the type to grab a cup and stay to work on their laptops, or are they the busy professionals who want to grab a cup and head on out? Knowing this sets the stage for a lot of other things.

    This question helps you answer:

    * How do I furnish the place? If you don't have a good vibe from day 1, no one will come back.

    * What specialty drinks do I offer? Do you keep it technical and offer siphon cups, drip flights, sparkling americanos, or do you appeal to the senses and offer smoothies, fruity blended ice drinks, and milkshakes?

    * Do I offer food? What food do I offer? If you don't serve food, you won't get my business. I don't have the data to speak to the market as a whole, but if I know that I can't grab a bite at a local cafe, then I'm less inclined to visit that particular shop. I'm sure I'm not alone in this. // Do I offer a full breakfast/lunch menu, or just pastries? What percentage of my offerings should be vegetarian/vegan friendly? Gluten free? What dairy alternatives do I offer?

    * What do I put on the walls? Do I decorate with purchasable paintings from local artists, magazines/books/newspapers, or do I let the exposed brick speak for itself?

    All of these things important factors in your shop.

    2. Check your margins. I imagine that the margins on specialty coffee are phenomenal - these can be further improved if you're willing to invest in your own roasting equipment to roast your own beans. (This also immediately offers a side-business of supplying coffee to local shops.) // For example, I know that, for Starbucks, selling one tall cup of drip more than pays for an entire batch. Use this to your advantage in pricing and reinvesting.

    3. Establish a brand identity. Slap a name on your business, figure out who you are, and literally write down in painstaking detail every action you take during your opening, closing, and mid-day operations. Also make sure to write a manual for hiring, and a manual on how to train new employees, and any other repeated facet of the business. This will make franchising/selling to a competitor infinitely easier on you. (See: "The E-Myth Revisited" - Michael Gerber)

    4. I repeat the same advice as many others in this thread have given - please, make sure people will actually give a shit about your cafe before you open it. I don't care what your friends are saying unless they're paying your commercial rent costs

    Where would you plan to open?
    How many cafes are within 10 miles of that spot?
    Who are your main customers in the area?
    Where are they getting their coffee from?
    What makes you better than the place above?
    What are your anticipated monthly operational costs?
    How many months can you expect to post a loss and stay in business?
    How much money do you have available to purchase equipment, hire staff, acquire necessary licenses, decorate, and advertise?

    Don't sell yourself short by thinking "I'll save the branding and decorating for later - if I have great coffee, I'll have enough traffic to keep me afloat!" // To give an example of this dangerous thinking, someone on this forum awhile ago was considering starting an arcade, even though there aw already another one in town. The competing arcade offered games, bowling, and had a ball-pit as well. Our fellow fastlaner only had enough money for games and bowling, but wanted to open their shop anyways, figuring that they could save up enough money to later invest in a rockclimbing wall, laser tag arena, and more.

    What they neglected to think about is, If my initial offering is worse than my competitor's current offering, no one will come to MY arcade!

    If you plan to be the best, then you need to hit the ground running. Make sure you can best your competition from Day 1. Don't expect to start off 'okay,' and work your way up from there.
     
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  25. AlessioLC
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    AlessioLC Bronze Contributor Read Millionaire Fastlane I've Read UNSCRIPTED Speedway Pass

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    Haha but money run everything! If you give the owner a little 20 euros ticket be sure he will let you sit there for an hour !
    But seriously, if you don't have visited Italy yet, you should!