Preparing a Business Plan for a Coffee Shop: Questions You Should Ask Yourself
Running a small, independent coffee shop is a romantic business notion that appeals to many entrepreneurs. It is a great idea, and it has worked for many in the past. Break free from the rat race, and concentrate on providing fantastic coffee and food for a friendly clientele of local customers. However, the reality is sometimes a little different. Competition between coffee shops and cafes is often fierce. To be confident of success, and to attract investment, you need to have a solid business plan behind you.
While preparing your business plan, you should ask yourself a few qualifying questions to check if this is the right kind of business for you.
1) What is your local competition?
If you’re planning on setting up your coffee shop on a High Street, the chances are you’ll be putting yourself in direct competition with at least one international coffee shop chain. Many large shopping centres are host to a Cafe Nero, Starbucks, and Costa Coffee. In addition to this, many pubs now do coffee in addition to alcoholic drinks, not to mention the competition you will face from the likes of McDonald and other fast food outlets. The presence of one or more of these competitors shouldn’t put you off. In fact, if anything it will prove the demand for coffee shops in your chosen area. However, you should be aware of your competitors, as they will often dictate the prices that the market is willing to take, as well as setting a benchmark for quality.
2) Are you planning to rent or purchase a property?
Have you done your research about the kind of retail property in which you want to host your coffee shop? If you are planning to purchase, then this will entail a substantial investment from the outset. Make sure your business plan factors in any upfront property purchases, and gives an estimated timeframe for your business to pay off its debt. Leasing a shop is a cheaper option, but research must be done to ensure you have the option to renew, and to make sure you are getting value for your money.
3) Are you qualified and prepared to run a coffee shop?
The qualifications you need to run a shop will vary depending on the services and products you provide. Do some research to find out if you need any certifications before you get started. This may be especially important if you plan to offer food as well as simply hot drinks.
4) What unique selling points can you offer your customers that make you stand out from your competitors?
With so much competition among coffee shops, your shop should have a unique vision that offers something special to your customers. The possibilities for this are almost endless. You may like to combine your coffee shop with a second-hand bookshop, or clothes store. Alternatively, you can create a local brand based on exceptional customer service, or perhaps on unusual coffee recipes. Whatever decision you make, your chosen USP will need to be costed up and written into your business plan in some detail.
If you’re passionate about coffee and feel you can make your dream of owning your own coffee shop work, then go for it. Many of the big coffee chains are very similar, and there is a large market crying out for something a little bit different. If you treat your business plan as an extended brainstorming session and a test of your ideas, then you can go into your new business with confidence that your new shop will have every chance of success.