As when starting any small business, opening a successful coffee shop takes a lot of planning. It’s tough to compete with large chains like Starbucks, but the market for independent coffee shops is certainly viable.
If you’re wondering how to start a coffee shop, there are several aspects to consider. From writing a business plan to hiring staff and marketing your grand opening, you’ll have a lot to think about before opening your doors to the public.
To help you on your way, we’ve put together a handy step-by-step guide to starting a coffee shop.
Before you start taking any steps to open your new business, you’ll want to write a detailed business plan. Think of your coffee shop business plan as a blueprint for a successful business, detailing precisely what you’ll do to start your coffee shop and keep things running smoothly.
It’s a good idea to visit some existing coffee shops to get inspiration about what to do and what not to do. You could also ask coffee shop owners questions about their business and how they run things — but they may not want to help if you’re going to be a competitor.
If you don’t know how to write a business plan, there are several templates available online that make a great starting point. But there are a few essentials you should include:
The ideal location for your coffeehouse: Choose an area of your town or city with high levels of foot traffic (ideally one with lots of shops or offices nearby) as this will make it easier for people to come in on a whim as they walk past.
What costs you’ll need to cover: This should include both startup costs, such as real estate, insurance, a business license, and equipment, as well as ongoing costs, such as wages, takeout cups, coffee beans, and utilities like electricity.
Your proposed source of funding: Will you take out a small business loan or seek outside investment? If so, how much are you hoping to raise, and from where?
A rough marketing plan: Marketing your business is an essential part of opening a coffee shop; it’s how you’ll ensure you have customers from day one but also how you’ll retain customers and build loyalty.
Once you’ve written a thorough business plan and carefully considered your cash flow, you’ll be ready to start putting your plan into action. That means there’ll be no more wondering how to start a coffee shop — it’s time to start!
The first step in opening a new coffeehouse is to decide on a theme or niche for your business. Consider your target market and picture your ideal customer base. This should inform the type of business you want to run and the style of your interior.
Do you want your coffeehouse to focus on specialty coffees, or would you prefer to keep things simple with a stripped-back menu? Do you want to sell food as well as hot drinks? What aesthetic or design are you picturing for your interior?
Deciding on a theme can help you answer these questions and specify exactly what type of coffee shop you want to open.
Next, look for prime real estate to house your new café. Your coffee shop location is vital, so focus on areas of your town or city with plenty of other stores, or choose a neighborhood with lots of offices nearby.
In addition to finding the right location, you’ll want to look for a space with everything you need. If you plan to serve food, choosing a retail unit with a kitchen already installed can help you save time.
If you have a big budget, you could consider renting or purchasing a large premises with a drive-thru. A food truck, coffee cart, or coffee kiosk might be more realistic if money is tight.
When you’ve found the perfect place for your new coffeehouse, start designing your menu. Classic menu items in a coffee shop include regular coffees (drip coffee, espresso, cappuccino, latte, etc.) but also specialty syrups and different kinds of milk (such as soy, oat, and coconut).
Remember that coffee drinkers all have different tastes. You’ll need specialty menu items and iced coffees to compete with large chains like Starbucks. If you're going to stand out as an independent coffeehouse focusing on high-quality coffee, you can probably do without these extras.
Purchasing coffee shop equipment is the next step in opening your new business — and you’ll likely need a lot of it.
The exact equipment you’ll need will depend on your menu and the type of café you want to run, but it will include items such as:
A high-quality espresso machine
A coffee grinder
A coffee roaster
Cups (for drinking in and takeout)
Tables and chairs — make sure they’re comfortable to attract extended stays
Napkins
Stirrers
Refrigerators to store milk and other cold items
Electrical sockets in the seating area — for cleaning equipment and so customers can use your coffee shop as a remote workspace
Choose the right equipment, and remember that high-quality equipment can help you make great coffee every time.
When people ask themselves how to start a coffee shop (or any small business), they can’t overlook choosing a point-of-sale system (also known as a POS system) or a way to process orders. This is an essential part of any restaurant business.
A coffee shop needs both an easy-to-use order processing system and a POS.
Some entrepreneurs choose to use self-service kiosks or staffed touchscreen tablets. KioskBuddy, for example, lets you transform a tablet into an easy-to-use self-ordering kiosk. Customers can use the app to place and pay for their orders quickly and easily.
The final step in running your own coffee shop is to hire and train a team of staff. You might have decided on a counter-service coffee house, but you’ll still need a few baristas behind the counter to make the coffee.
Look for staff members whose goals align with your business goals, and ensure you have enough money in your monthly budget to pay them a fair wage. Treating staff with respect and compensating them fairly for their labor is the best way to ensure a happy and productive team.
Remember to factor in enough time to train your staff before your opening day so that everything runs according to plan when you open your doors.
With the above six steps, you’ll be ready to open a coffee shop. However, if you’re wondering how to start a coffee shop that’s popular with customers, then you’ll want to focus some of your efforts on marketing. Marketing is a crucial business process whether you’re opening a new restaurant, supermarket, or coffeehouse.
From hanging posters that advertise your new coffee shop to using social media to spread the word, there are many ways to tell potential customers that you’re serving up the best cup of coffee in town.
You could give discounts for opening day to build some excitement around your brand, but remember to plan for customer retention and attraction. Try a few marketing techniques to see what works for your new business.
When you’ve completed the above steps, you’ll be ready to start a coffee shop and keep things up and running. Opening and operating any new business is hard work, but your business can thrive with the right tools and team.
Sign up for KioskBuddy and turn your tablet into a self-service kiosk. Customers can place orders themselves with just a few taps, meaning your staff are free to focus on making great coffee. It’s quick to install and super easy to use.