by Bruce Milletto Coffee
10 Essentials in Starting & Successfully Operating a
Specialty Coffee Business
Courtesy of Bellissimo Coffee InfoGroup
you are thinking of starting a coffee shop, Bellissimo
Coffee InfoGroup spills the beans below
on how you can create a successful and profitable coffee
1. Create a Sound Business Plan
The first step in opening coffee business is to create your
business plan. Writing a business plan will require you to
focus on exactly what you are trying to achieve, precisely
where you want to go, and exactly how you plan to get there.
It will force you to detail the many expenses involved in
opening your business, the projected sales and monthly expenses
of actual operation, and the volume of business you will
need to generate to be profitable.
A well-written and attractive business plan is essential
when you are looking for a location and obtaining financing.
It needs to convince property managers and lending institutions
that your business concept can be successful, and that you
possess the expertise—alone or collectively—to
ensure that it will be profitable.
2. Find a Great location
One compelling reason why location is critical in this business
is that while people love coffee, research indicates they
will rarely go more than a block and a half out of their
way for it. You have to put your business "where the
action is," so to speak. Your business needs to be in
a convenient location for customers — on their way
to work in the morning, around the corner from where they
work or in the mall where they shop.
Finding a good location generally requires effort, persistence
and patience. Your location considerations will, of course,
depend upon your concept. You will need a different type
of location for an upscale, sit-down coffee bar than you
would for a cart or drive-thru operation. One factor common
to all desirable locations, however, is the proximity of
a large population of potential coffee drinkers.
Probably one of the hardest things for people to realize
is that the right location is worth waiting for. Take time
to find the right location, even if it takes six months to
There are two types of locations appropriate for coffee retail:
high-migratory locations and captive-audience locations.
High-migratory locations include shopping centers and malls,
sports arenas and performing arts centers, amusement parks,
and tourist attractions. Large numbers of people — not
necessarily the same people — pass by these locations
daily and comprise the customer base for your coffee operation.
Examples of captive-audience locations include large office
buildings, business and industrial parks, hospitals and medical
centers, college and university campuses, core downtown sites,
military bases, and densely populated neighborhoods. Captive-audience
locations are more appealing to most of us, because many
of the same people will come back five to seven days a week,
and you can keep building your business on a solid customer
3. Consider your Store Layout and its Ambiance
The layout of your store and its ambiance are critical to
the success of your business. If your operation is poorly
designed, either from the standpoint of ambiance or of working
layout, your sales will suffer every day your doors are open.
As surprising as it may sound, even small design deficiencies
can impact your bottom line. Big design errors can actually
prevent you from making a profit at all.
The ambiance you create is one of your best marketing tools.
The look and feel of your business and the brand you create
is your signature, and it’s one of the most important
reasons customers will choose you over the competition. Strive
to be original to set your coffee bar apart from your competition.
Great ambiance doesn’t just happen. It begins with
good layout. You want a clear sense of welcome as people
enter, with simple menus easy to read and understand. You
want to serve people efficiently, especially during peak
times. You want your design to help you serve each customer
promptly even at your busiest times, while still making them
feel relaxed and welcome.
Ergonomics, or human engineering, is also important when
considering your store’s layout. Good ergonomic design
will allow your staff to do things with the fewest steps
and the least reaching, performing their jobs quickly without
colliding with others or creating hazards. Good ergonomics
will increase convenience, raise efficiency and reduce wasted
effort. Use ergonomics to maximize safety and help prevent
accidents, while reducing frustration and fatigue, and increasing
Good ergonomics is also design that respects your customers.
Today, it includes an understanding of how chairs and tables
and counters fit, how people line up, how they view signage
and how long they will enjoy sitting in a particular chair.
Let ergonomics help you achieve the best fit for your service
counter, seating areas, coffee displays, pastry cases and
4. Choose the Right Equipment and Company
Many may question how the equipment you choose affects the
feel of your operation. A client of Bellissimo built a beautiful,
well-thought-out coffeehouse where cost was not a major factor
in selecting the materials. However, when it came time to
buy an espresso machine that would be the focal point of
his operation, he chose an ugly, boxy two-group machine,
totally out of character with his upscale theme. We told
him he needed a red Ferrari as his centerpiece. He never
regretted his subsequent purchase: a larger, modern, colorful
three-group machine that complemented the character of his
operation by adding to—not diminishing—the look
and feel he desired.
When purchasing equipment, you also need to consider service
after the sale. While some equipment may be a good deal,
if the company you purchase it from doesn’t have a
service network, you may find yourself in dire straights
if your machine breaks down and there is no one to fix it.
Try to work with companies that can provide the services
you may need beyond the initial sale.
5. Plan a Great Menu
Your menu is one of the most important aspects of your business.
You will maximize your chances for success if you dedicate
plenty of time and thought to planning and developing the
perfect menu for your particular location, concept and clientele.
The type of operation you choose, cost restraints, and space
limitations are factors you’ll need to consider when
developing your menu.
Most hot coffee is sold before ten in the morning. You plan
to be open all day. Do you have a strategy for profits during
all hours? Be creative with unique breakfast ideas. Bagels,
granola, yogurt, fresh fruit or frozen waffles might work
for you. A soup and sandwich menu for mid-day, plus iced
coffee, smoothies and granita for afternoon can keep people
buying. In the warm months add ice cream or gelato.
No matter how extensive your menu is, your business is first
and foremost a coffee operation. Your primary identity
is your coffee. You want to be known as THE coffee operation
in your area, the one that serves the very best coffee.
do this, you must fully understand the nuances of your
product. That is a tall order, and requires you to fully
6. Hire the Right Employees and Train them Properly
The people you hire will make or break your operation. No
matter how clever you are, if you don’t hire the right
employees to carry out your ideas, you have lost the battle
before you have even begun to fight. Not every eager, attractive,
capable person can do well in your business. When hiring,
look for people who not only have the ability to prepare
products with flair and perfection but who also have personality
you want as the "face" of your business. You can
train people to perfect a certain skill set, but you’ll
rarely be able to change someone’s ingrained attitude.
Never underestimate how important your employees are to your
business — they are your business. Training may be
the most important job for an owner or manager, and it’s
never-ending. Managers will tell you they train their employees,
but usually they don't do enough of it to build respect for
coffee and their customers. Turnover is rapid in food service,
so a structured program is essential. Your employees will
learn and practice excellence only if YOU make sure they
get the training they need. If you have six or more employees,
you may want to appoint your oldest, most knowledgeable or
most stable person as a training director.
Your dreams of success will simply not be realized if your
people don't get the best possible training. The initial
training of a new staff person is without a doubt one of
the most important factors in marketing your business. And
frequent refreshers will prove important. Sometimes overwhelmed
when first hired, people may pick up bad habits when unable
to retain the volumes of detail in all they were told. Your
marketing program, no matter how good it is, can’t
overcome mistakes that are inevitable unless staff members
have a regimen of highly structured basic training, then
receive regular updates on their coffeehouse education.
Your goal is to hire, train and retain great employees. It
costs you time and effort to bring on new people and get
them up to speed. To keep the employees who can think fast,
solve problems and welcome every guest, you have to do more
than just chose them with care. You must train them well
and pay them fairly.
7. Provide Excellent Customer Service
The way your customers are treated during their visit to
your business is also a critical element of the success of
your operation, as is the overall knowledge your staff has
about your menu and coffee. A knowledgeable and customer
service-oriented staff will make your customers feel they
are frequenting an establishment that stresses quality.
Good customer service is the first step in good marketing.
Most of the people who walk through your door or drive up
to your window will expect your employees to be courteous,
friendly and professional. They count on special treatment
as much as they count on receiving the high-quality product
you hand them when you take their money. Next to great coffee,
the most important thing you have to sell is excellent service.
The right employees sell a great experience that creates
repeat customers who tell their friends.
8. Be a Good Leader
Strive to lead your staff by example, and always give 100
percent. To lead and manage on a day-to-day basis in your
coffeehouse, you have to plan and stay organized so you can
provide direction as to who will do what, when, and how.
Each employee needs to know what you expect and what is not
permitted. You earn respect by displaying your own passion
and skills, and by inspiring people to learn from you and
to set personal goals.
As a leader with good people skills, you can attract and
keep talented employees who are committed to your goals.
To lead effectively, you must see past your own wants to
understand why people do what they do and to understand and
accept human failure. Use your imagination to see reality
from their point of view. Employees know when you have their
best interests in mind. An excellent manager sincerely wants
others to do well and seeks to motivate them to unlock their
The good manager works to create a team with common goals
of excellence. But select those goals to reflect true priorities,
those that will make the biggest difference with the least
effort. Train your people well and make sure they know what
you expect each team member to do.
Always set high standards and then put in place ways to measure
how they are achieved. The best manager sets targets but
does not micromanage how people go about achieving them.
Show trust and encourage thinking by expecting employees
to deal with the normal, everyday issues themselves.
Your personal will and attitude set the tone for your entire
operation. Good communication with customers and employees
is basic to success. Don't stop there. Extend it to suppliers
and other businesses you work with to expand your circle
of goodwill and cooperation. It all starts with valuing and
caring about others.
9. Market Your Business
The big marketing challenge for the owner of a single coffee
operation is competing with the corporate chains in your
area, with advertising budgets hundreds of times what you
can afford. But whatever marketing choices you make, you'll
have to set aside time every day or week to address this
absolute essential of success. And you'll need a budget,
preferably in a special account that you can control and
use to access your results.
Don't wait until your business is sagging to do your marketing.
A concentrated and sustained effort early in the game will
give your business the necessary start-up exposure. Before
you go any further, you'll want a good name, a great logo
and a concise business image. Then comes a detailed plan,
a calendar of what to do when, and a promise to yourself
to stick to it. A good plan sets goals, targets specific
demographics, takes into account the competition, has a clear
objective, and selects appropriate media. Whatever you do,
be as professional as possible. Your audience will be comparing
your efforts to the hundreds of glitzy million-dollar ad
campaigns they see each month.
Marketing goals could include getting more customers, keeping
the ones you have, getting them in more often and getting
people to spend more — or all of these. This business
is dependent on volume — more people, more often, making
more purchases. If you sell a muffin to every second customer,
you can increase your gross by several thousand a month.
Your marketing goals could be quite specific — bringing
in more business, meeting customers or creating a promotion
to sell 20 percent more beans. You could determine you want
to train employees in tactics that will sell 30 percent more
pastries between eight and eleven in the morning, or to hand
out a coupon to increase sales of gift items by 80 percent
during the holiday season, compared to July.
10. Develop Effective Operational Systems
The manager of a coffee operation must control hundreds,
perhaps thousands, of variables on a daily, weekly or monthly
basis. If you don’t have operational systems in place
to monitor all the aspects of your operation, many details
will be left unattended or go unchecked. Operational systems
will allow you more time to manage effectively and will alleviate
You have a choice. Try to control a thousand variables, or
control two-dozen operational systems. If your systems are
set up properly, and designed with an element of accountability,
they will be effective tools that will save you money, time,
and frustration. Operational systems will improve the efficiency
of your operation and insure that your costs are under control.
Coffee InfoGroup has set the standard
for education, training and consulting in the specialty
coffee industry. Thousands of coffee business owners
have benefited from our expertise and created successful,
profitable operations from cafes to drive-thrus to
major chains across the country.