Variables lurk that could negatively impact your coffee or restaurant business, or even reduce your chances of survival. Failure doesn’t necessarily mean closing your doors—it can also be a failure to capitalize on opportunities for growth. Avoiding small mistakes in your business processes can make all the difference.
The number one reason cafes and restaurants fail is, of course, a poor location. Let’s assume yours isn’t killing you (and if it is, you might try improving your odds with better signage and some advertising), and focus on things you can more easily correct, to increase your odds of success:
Too costly a kitchen. You can easily overspend on all the best kitchen appliances and gadgets, while the customer experience at the front of the house suffers. Used restaurant equipment can be a real bargain. Make sure the customer experience is your highest priority—clean and welcoming, and facilitating quick, reliable service.
Poor layout. Speaking of quick service, you need an intuitive place for customers to line up and place orders, and for them to wait for their drinks and food. Cafes in particular must process thousands of transactions per day to be sustainable, since sales per transaction are low. If your coffee or food prep areas are not well designed and require a lot of back and forth, you limit your potential for sales volume while also increasing your labor costs.
Too cost focused. Your food costs are important, but so is having a good relationship with your suppliers—one where they go the extra mile to make deliveries on time. Don’t get too stingy about costs and you’ll get cozier with your vendors.
Small portions, large prices. American portions have admittedly gotten out of hand—no one needs a Costco-sized muffin or a platter piled with French fries. But people will notice if you’re selling petite pastries for $3 (and they’ll end up going stale in the display case). Worrying too much about the profit in the sale and not focusing on winning repeat customers will leave you broke, not profitable.
Poor staffing. You’re not just selling drinks and food. You’re selling stress relief, belonging and many other intangibles that come down to how your staff engages with customers. The cafe or restaurant with the hardworking, friendly staff is the one that succeeds. Customers may forget what you sold them but they will never forget how you made them feel.
Erratic hours. Don’t expect customers to remember your unique schedule. Coffeehouses in particular thrive on customers’ daily routines. Commit to regular hours from morning to evening, every day (with an early closure on Sundays, maybe). If you close at 8, don’t lock the door at 7 because it’s slow. Assign cleaning tasks or next-day prep. For holiday closures, post a sign on the door and the cash register at least a week in advance. The same goes for scheduled repairs that require you to close. If you respect people’s time, you’ll earn their loyalty.