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Strategies for Building Revenue in Your Coffee Shop or Restaurant

Posted by Julie Beals on Tue, Jan, 10, 2017 @ 14:01 PM

Coffee shops and restaurants are as much (or more) about customer service than they are about goods and transactions—though the goods need to be good, no doubt. A purely transactional business can succeed without an owner’s presence, but a coffee shop or restaurant needs the owner’s regular involvement. Customers expect it, and staff are more engaged when the owner at least occasionally takes orders, makes coffee and is actively watching over the business.

Beyond your undying attention, following are some good ways to build revenue at your coffee shop or restaurant.

Use loyalty cards. They really do work, and you can see the proof when a customer’s face lights up after you give them the free drink they’ve earned. Better yet, give a new customer a card that has all but one of its holes punched, so their very next drink is free. Easiest—and possibly cheapest—customer acquisition you’ll ever make.

Limit choices. Choice paralysis is a real thing. A classic example is two jam tastings that took place at a grocery store, where one gave the option of 4 jams to buy after the tasting, and the other gave 15 options. The tasting that offered only 4 jams sold about twice as much jam.

Take care of the key categories, with three or four flavors, three sizes, three or four sandwich options, etc. Each item you add to your menu increases management costs, and possibly without adding to your revenue stream or customer satisfaction.

What Makes a Coffee Shop Succeed?

Posted by Julie Beals on Tue, Nov, 29, 2016 @ 15:11 PM

I’ve heard people who are considering opening a coffee shop say things like, “I think it would be fun to own a local hangout,” or “Everyone wants a coffee shop near them, so how can I go wrong?” Or even simply, “I love coffee, so why wouldn’t I love the business?”

While these rationalizations can warm you to the prospect of putting your life savings into a coffeehouse, make sure you have these fundamental characteristics as well:

  1. You’re passionate about coffee and talented at it. If you’re not, you’ll need to have a local workforce that offers skilled baristas who already have that talent and passion.
  2. You like people. You’re in the people business as much as anything else. If chatty regulars, needy staff and the milk delivery guy who never gets your order right are bound to drive you crazy, consider a less social endeavor.
  3. You have your ultimate goals in sight. You should be planning your exit strategy from the business simultaneously with its growth. If you’re passionate about your coffee shop the long hours won’t bother you—at first. After a few years you could start to feel weary. Plan your exit by hiring the best people, planning financially for the best and worst of times, and delegating as many daily tasks as possible.

There is no one secret to a successful coffee shop; in fact, most business acumen comes from hard work, extensive experience, or even luck. You’ll also need substantial resources resources, which you can’t recoup if your shop fails.

Experts estimate $150,000 for initial buildout, plus $50,000 for initial payroll and unexpected expenses. (And there are always unexpected expenses.)

If you’ve got the cash in the proverbial bag, here are some ways to bank on success:

Before you sign a lease, scope out potential locations at several times of day, and days of the week. 

Hang out in front of the building on random mornings, afternoons and evenings. Count how many cars or people pass by every hour. Are there a lot of drivers who will want coffee on their way to work? Are people walking by regularly? Are they alone or in groups? Will there be enough parking for your shop to become a destination?

Also, research businesses that used to be in that space. If another coffee shop closed in the same location, find out why.

Note: A high traffic location isn’t do-or-die. In this more mature market, coffee is often a destination, not just an impulse buy. While you want to be located where there are a sufficient number of people, you don’t necessarily need the most high-traffic location (which will come with high rent and competition from franchise chains). 

Outsource critical tasks to trusted professionals.
A business lawyer with real estate experience should analyze your contracts and lease agreements. An accountant or bookkeeper can keep your finances in order better than you can while you build your business. Use a good payroll company and/or said bookkeeper to make sure you’re correctly paying and reporting all paychecks and taxes.

Use great coffee. 
Palettes vary regionally, so you may want to find a local roaster—if they meet your standards. An out-of-town roaster can also appeal to your market, but will lack fast, personal service. And a local one may even help train baristas before opening day.

Know your product.
Master brewing techniques for coffee and tea in all its forms, and learn how growing conditions and roasting techniques affect the final product, varietal names, etc. And make sure you pass your wisdom on to your staff. Sharing curiosity and diving into the nuance of this business is one reason people stay in it for so long, and why they love geeking out on it with each other. The enthusiasm can be infectious for customers, too.

Price your products right.
Price your offerings according to customer expectations and what the market will bear, not a straight markup percentages. For coffee you’ll need to be right around the average price for your area, for other things you’ll need to be below market price (sodas), and this loss should be made up with high margins on other items that are exclusive to you or in the ‘don’t-care and addictive’ category for customers.

Someone once said: If everyone complains about your prices, they’re too high. If no one complains about your prices, they’re too low.

Hire passionate people to work for you.
Find people who will present your product with a smile and will show pride in your products/services. Model the behavior you want your employees to follow. 




Listen To Employees Who Challenge Policies

Posted by Julie Beals on Mon, Nov, 21, 2016 @ 14:11 PM

by Stan Silverman in the Twin Cities Business Journal

Most of us have run into policies at work that don’t seem to make any sense. They impede the ability of the company to implement change and to achieve its goals.

Without the influence or authority to change them, employees are frustrated, wondering why these policies remain in place.

Every company needs policies and procedures to effectively serve its customers or clients, ensure equitable treatment of employees, protect against litigation, and to meet legal and regulatory requirements. Without them, there would be chaos.

What I am referring to are those policies that don’t make sense, but are rarely challenged.


How Does Water Filtration Make Coffee and Tea Taste Its Best?

Posted by Julie Beals on Thu, Sep, 29, 2016 @ 15:09 PM

It may seem excessive or snobbish, but it would be a shame to take a premium specialty-roast coffee or a fine tea and brew it in regular old tap water. Coffee and tea are nearly 99 percent water, making good water quality essential to the final product.

So what makes for good brewing water?

  1. For starters, it needs to be free of odors and foul tastes, generally caused by chlorine, lead, asbestos and other contaminants that are common in municipal water.
  1. It also needs to be free of calcium, which can damage your espresso equipment. (More on this later.)
  1. Your water needs some mineral content as this is actually what makes water taste good—and thus makes a good cup of coffee or tea. Without minerals, water lacks mouth feel and flavor and will taste flat.

Water Filtration versus Softening

Water filtration generally refers to carbon-based filters that remove the bad tastes, odors and particulate matter from water. Every city and town has at least a few of these bad actors floating around in their water supply. It’s unavoidable, short of charging residents a lot more for all the water they use—including bathing, gardening, etc.

Water softening is the process of removing minerals (namely calcium) that will build up inside your espresso machine and cause problems if not removed. It’s called scaling, and looks just like it sounds: like scales coating the inner workings of your equipment. It’s not pretty.

To treat the hard water in the upper Midwest, our service techs at Espresso Services are adamant that customers soften water for their espresso machines.

The ultimate method for accomplishing both filtration and softening is a dual filtration and reverse osmosis softening system, such as those offered by Everpure, Pentair, 3M and others. These systems essentially manufacturer pure water and let you precisely adjust the mineral content, so there is enough for your coffee to taste good but not enough to harm your equipment.

There are four steps to most filtration/softening systems:

  1. Sediment Filtration: Removes rough particles, sand and rust.
  1. Carbon Filtration: Removes chlorine and chemicals that contribute to bad odors and tastes, and would otherwise damage the reverse osmosis membrane.
  1. Reverse Osmosis: Removes dissolved solids and virtually everything larger than the water molecule itself. This is where most of the purification is accomplished.
  1. Re-mineralization: Water purified by reverse osmosis is highly pure and slightly acidic. Trace amounts of calcium and magnesium are added back in during re-mineralization to balance the pH and improve taste. 

Bonus: Polishing Filter

Some filtration systems include a final carbon filtration that will will “polish” off the water to remove any remaining taste and odor.

Tip: La Marzocco’s water content parameters are followed by hundreds if not thousands of reputable coffee shops. It’s easy to plug them into reverse osmosis systems. 

Contact us today to purchase and install your water filtration and reverse osmosis softening system.




Educate Your Customer: The Difference Between Cold Brew and Iced Coffee

Posted by Julie Beals on Wed, Sep, 21, 2016 @ 15:09 PM

Originally published at phillyvoice.com.

by Brandon Baker

Starbucks, Saxbys, Dunkin' Donuts — at this point, just about every shop in town, artisanal or not, is pushing out some version of cold brew. And, generally, is advertising it (if you haven't noticed by the price) as better than their iced coffee.

But what's the deal? What's the difference between the two, and is one actually better than the other? We reached out to Ross Nickerson, the mechanical-engineer-turned-coffeemaker who opened the Italian Market's Function Coffee Labs in May. 

Cold brew is everywhere now, and everyone seems to generally be accepting that it's better than iced coffee. But what's the difference? And is it better?

In a non-specialty coffee shop, 'iced coffee' might simply refer to their normal drip coffee — hot – being poured directly into a cup full of ice. This results in a very watered-down drink.

In a specialty coffee shop like Function Coffee Labs, 'iced coffee' is done by brewing a stronger version of hot coffee directly onto ice. This is sometimes referred to as the Japanese method or the flash-cooling method. The ice melts as the hot coffee drips onto it, but since the coffee is stronger in the first place — achieved using more coffee grounds but the same amount of water, and/or grinding the coffee finer — then, when the ice melts, the resulting drink is at the 'correct' strength. Making a batch of flash-cooled iced coffee takes the same amount of time that brewing a batch of hot coffee takes, or roughly five minutes. So, it can always be served fresh, and there will be some of the pleasant aroma that a regular hot coffee has.

Cold brew is a completely different thing. The coffee beans are generally ground very coarsely, and brewed in a full immersion method, like a French press, for 16 to 24 hours. The brewing water is cold, not hot. Unfortunately, many of the complex molecules in coffee that provide flavor are less soluble at lower temperatures. This means that less of the unique, interesting flavor that each coffee naturally has — which depends on where it was grown, the weather, how it was processed, etc. — ends up in the cup. So, most cold-brewed coffee tastes basically the same: sort of chocolate-y and caramel-y. 

'Hot bloomed' cold brewed coffee is an attempt at getting the best of both worlds. A small amount of hot water is poured onto the coffee grounds and allowed to steep for a short amount of time, maybe 30 seconds, then the majority of the cold brewing water is added. This does allow some of the more interesting, unique flavor compounds to end up in the final beverage, but not nearly as many as using the flash-cooled method.

Here, we actually very much enjoy the taste of cold brewed coffee, but we feel like it is a waste of the potential of a great coffee bean. On the flip side, if you have some cheap commodity-grade coffee beans, cold brewing them is a great way to make them taste not terrible. 

We brew a small batch of hot-bloomed cold brew each day so that we can let customers taste the difference. The vast majority prefer our iced coffee.


New Report Shows Why Coffee's Future Is Bright

Posted by Julie Beals on Thu, Sep, 01, 2016 @ 14:09 PM

Coffee's ever-increasing popularity among younger consumers, as well as popular brewing options such as cold-brewed and pour-over coffee, means things keep looking up for the industry. Data from Technomic's Volumix Coffee Report shows sales for single-cup coffee increased 62% in 2015, and the average per-pound price for single-cup coffee rose 6% between 2014 and 2015.

The Volumix report outlines what coffee shop owners are purchasing, what the retail space is demanding, and developments in the independent sector.

Takeaways from the Volumix Coffee Report:

  • In 2015, S&D Coffee and Douwe Egberts led all brands in total volume and sales among distributed brands.
  • Vanilla, followed by mocha and chocolate, were the top flavor callouts mentioned among distributed SKUs in 2015.
  • Colombian and Arabica were the top origin callouts mentioned among distributed SKUs in 2015.
  • The Top 10 coffee SKUs make up 29% of all SKUs distributed in 2015.

Volumix's mission is to deliver a 360-degree view of the food industry by generating SKU-level data from over 28,000 independents and small chains, independent operators, so suppliers can better understand the competitive environment. To view sample data, or to learn more about this resource, visit Technomic.com.


Coffee Types: Know Your Natural From Your Washed From Your Honey

Posted by Julie Beals on Mon, Aug, 01, 2016 @ 19:08 PM

by Lauren Mowery 

A great, basic tutorial on green coffee processing. Full article appears on forbes.com

Coffee is getting complicated. And I don’t mean understanding the difference between an American cappuccino (obnoxiously oversized like a bowl of fettuccine Alfredo from Cheesecake Factory) and the daintier original invented by the Italians (who are generally horrified by both our bastardization and willingness to drink one at any time of day.) But I digress.

Consider the term “green coffee.” Even the hue of standard commodity beans — the second most heavily traded commodity in the world after crude oil –- can be several shades removed. Referring to the color of beans before roasting, green coffee can range from dark raisin to dried chickpea, and the taste profiles, for those attuned to them, can also be wildly different.

This great variation in color derives from the processing and fermentation methods used in different regions, based on their weather conditions and resources. It should not come as a surprise to those with winemaking familiarity that this other carefully cultivated fruit also requires some application of chemistry. 

What is processing? For all its negative connotations in the food world, processing freshly picked cherries references the necessary steps taken, which includes some degree of fermentation (yeasts and bacteria break down the sugars found in the mucilage to produce acids and fruit notes), to remove the three layers around the seed in order to prepare it for shipping, and later, roasting. Those layers are first, the outer fruit or pulp, second, the sticky mucilage covering the seed, and third, the parchment, or thin layer covering the seed that is named for its resemblance to parchment paper when dry.

As consumer palates have become more sophisticated, specialty coffee producers have begun using processing methods as a creative tool. Whether accentuating fruit notes, highlighting or softening acidity, and fattening or lifting the body, this creates product differentiation. Think about wine for a minute. Grapes left longer on the vine develop more sugar, thus more alcohol and a bigger body, and riper fruits. Grapes picked earlier have higher acidity, less alcohol, a leaner profile, and tarter fruits. While not an exact comparison, the point is to show that, from a producer standpoint, coffee processing decisions, along with terroir (e.g., a cool, coastal site in Sonoma v. a warm valley site in Napa) and tree variety (e.g., Pinot Noir v. Cabernet Sauvignon), influence the sensory properties of the final drink.

While experimentation continues, the three predominant processing methods you’ll find on the market are dry or natural (labor intensive), washed or wet (water-intensive), and a newer hybrid called honey or semi-dry.



So Many Coffeehouse Design Plans, So Little Time

Posted by Julie Beals on Tue, Jul, 19, 2016 @ 13:07 PM

There’s a lot of documentation involved in getting your coffee shop built out. Here’s what you need to know.

Our recent post about coffeehouse design showed you all the things you’ll need to consider when planning the use of your space. But that may be the easy part. Ultimately you have to assure the dimensions of everything you bring into the space are spot-on, as well as making your electrical and plumbing plans crystal-clear and correct, so you can avoid myriad headaches: rejection of your plans by your local authority (city or county), equipment that doesn’t fit in the space allotted for it, or other design mistakes that can be expensive to address after the fact.


Your floor plan must outline dimensions for new partitions, doors, cabinets and fixtures. This will, of course, assure that all equipment, furniture and fixture end up where they should, and fit into the space.

You also need to account for existing features, some of which may not be up to code and will need to be fixed. If your space was formerly used for food service the code violations may be grandfathered it—but don’t count on it. Check with city/county. Some features that commonly need upgrades are sprinkler systems, stairways (making them less steep and/or adding a ramp), bathrooms (requiring ADA standards). 

Electrical Plan 

Your electrical plan will show the location and configuration of all outlets (horizontal or vertical), and details on voltage, amperage, phase, hertz and whether any power sources require a dedicated circuit.

A small, basic coffee shop might get away with a 200-amp service, but typically 400 amps will be required if you’ll be using an electric water heater, high-temperature dishwasher or cooking equipment.

You may also need to adjust existing electrical for:

  • Reconfigured lighting
  • HVAC
  • Signage – business sign, open/closed, exits
  • Speaker and TV wires
  • Cash register and receipt printer
  • CAT5 wiring and WiFi

Plumbing Plan 

Your plumbing plan should show locations for all water sources, drains, water heater, water filtration system (with specifics on whether it’s a full system, reverse osmosis, or single filter), grease interceptor (if needed), bathroom fixtures, etc.

Some of your equipment will also need to be hooked up to a sink drain:

  • espresso machine
  • dipper wells
  • ice maker
  • soft drink dispenser

Keep in mind:

  • Many cities require a grease interceptor on the drain line from three-compartment sinks and automatic dishwashers, to keep grease from entering the public sewer system.
  • Most retail space does not come equipped with a water heater large enough to handle food-service needs.
  • Floor drains in the kitchen and behind the service counter will allow you to squeegee liquids away when spills occur, and when washing floors.
  • If you add new walls to the existing layout, you may need to have the fire sprinkler system reconfigured

Cabinets and Counters

For your cabinet maker to give you the most user-friendly storage spaces, be sure to let them know:

  • Leave room for water filters.
  • Which cabinets will need doors, and which ones should have drawers. Or get their advice on this.
  • Height of cabinets over any counters—to accommodate equipment that sits on the counters.
  • Open spaces that are needed in the counters to accommodate trash cans, knock boxes or cup dispensers. Check local codes to see if a sneeze guard is required.
  • Note: Home kitchen cabinets are typically 24 inches deep, but commercial cabinets should be 30 inches deep, or 33 inches if an under-counter refrigerator will be used.
  • Also make sure your counter tops are a minimum of 36” high and not the typical 42”—keeping in mind under-counter refrigeration heights.
  • And always allow a couple of inches beyond the dimensions of the equipment, so it can be easily inserted and removed.

Finally, the equipment itself

Make sure your equipment is up to standards set by your city or county. it will typically need to be NSF & UL approved, or have an equivalent foreign certification. The peole reviewing your plans may want to see manufacturer specifications that prove your equipment complies with their standards, before they approve your plans.



Tags: design, buildout

Tips From A Pro For Opening A Coffee Shop

Posted by Julie Beals on Tue, Jul, 05, 2016 @ 11:07 AM

Nicholas Cho, co-founder of Wrecking Ball Coffee Roasters, has opened six coffee shops since 2002, in both the Washington D.C area and San Francisco. In a Serious Eats post from 2014, he dispelled some thoughts that bear repeating, about how to approach this business of coffee—if you want to consider yourself among those that serve true specialty coffee.

Even if you want to serve good coffee that's not necessarily on the bleeding edge of "specialty" while focusing more on amazing baked goods or the best sandwiches money can buy, Cho's words can be translated to those passions, too. It's all about really showing up and knowing your stuff and caring.

Cho offers a big-picture analysis of how to approach and immerse yourself in your craft including keeping track of trends, staying educated and building a culture that others will want to be a part of. These are all huge factors in success—about as important as the right location or even your cash flow. Not to sound metaphysical, but it's about energy flow. It matters.

Whether you're a full-on specialty coffee shop or one that sticks to the traditional aesthetic and palate of your town or region, make sure you're the best version of that model that you can be.


A Few Tips From A Pro For Opening A Coffee Shop

Posted by Julie Beals on Wed, Jun, 29, 2016 @ 20:06 PM


Nicholas Cho is co-founder of Wrecking Ball Coffee Roasters. He has opened six coffee shops since 2002, in Washington D.C. and San Francisco. In 2014 he dispelled some thoughts that bear repeating, about some of the things you need to consider carefully if you want to consider yourself among those that serve true specialty coffee.

Even if you want to serve good coffee that’s not necessarily on the cutting edge of “specialty” while focusing more on baked goods or great lunch items, Cho’s words can be applied to those passions, too. It’s all about really showing up and knowing your stuff and caring.

Cho's big-picture analysis on how to approach and immerse yourself in your craft include keeping track of trends, staying educated and building a culture that attracts like-minded employees and customers. These are all major factors in success—just about as important as the right location or even your cash flow. Not to sound metaphysical, but it’s about energy flow. It matters.

Whether you’re a spot-on specialty coffee shop or one that sticks to the traditional aesthetic and palate of your town or region, make sure you’re the best version of that model that you can be.

Tags: coffee