Coffee shops are not only a staple in our daily lives. With the industry valued at £10 billion a year, they’re also incredibly lucrative. However, a typical city will have one (or more) on every high street so, what does it take for a new coffee business to stand out and be successful?
To help you navigate the practicalities of launching a coffee shop, we spoke to David Abrahamovich, CEO and founder of GRIND, and Santiago Gamboa, co-founder of Hermanos Coffee. Together, we discussed just what it takes to open a coffee shop that stands out and becomes a part of our daily lives.
Find your niche
London alone has seen a 700% rise in independent coffee shops since 2010, so it’s important for new coffee shops to find a niche to stand out on the high street. With over 15 years in the industry before he launched Hermanos Coffee, Santiago knew that finding a niche was critical for a memorable brand. “We were always going to be a specialty coffee company,” he told us. “Coffee is like wine, different people like different things, so we wanted to show them the true range of Colombian coffee.”
Although GRIND is now known for its coffee by day, cocktails by night model – and its Instagram-friendly pink coffee tins – CEO David told us that GRIND’s niche was found along the way. “I don’t think you need to find a niche from the start, you can evolve into it and figure it out as you go. As long as you stand for something and have clear values from the beginning, there is no reason why your brand can’t change over time.”
Sort out your supplier
Unless you’re lucky enough to own a roaster, you’ll have to find a trustworthy coffee supplier. Luckily, there are dozens of coffee roasters in the UK, compiled into this handy directory. When choosing a supplier, Santiago had some advice: “Your starting point has to be your customer, consider what they will like and go from there. Make sure you ask for samples from each supplier too, so you can try it for yourself.”
Although they now roast their own coffee, GRIND started out with a coffee supplier. “We chose them because they were happy to package the coffee with our brand and not someone else’s, which is common in suppliers. I suggest speaking to lots of potential partners, the right one becomes clear quite quickly.”
Find the space
Both David and Santiago agreed that location is crucial when it comes to opening a successful coffee shop. “It’s absolutely everything,” David told us. “If you're in the wrong place, you're going to have work ten times as hard.” Santiago agreed with this: “You need to think of where you will find your customer. Then you need to look at the analytics: figure out if you can convert the footfall into rent and wages. Sometimes a difference of 20 metres on the high street can make or break a business.”
To minimise this risk, Santiago suggested renting temporary retail space for first-time coffee shops. It’s how Hermanos Coffee were able to expand to launch on the London high street. “Flexible leasing was so important to us,” he recounted, “it made it so easy for us to get access to get great locations, which wouldn’t have been possible otherwise. There was no big deposit or long lease. Also, if your area isn’t right, it’s easy to try somewhere else.”
Build the right team
Now that you’ve selected the right space, you need to find the right people. We asked David what kind of people are the best fit for a coffee shop. “The team is everything. Look for fun, energetic and passionate people with bags of personality. Training is also incredibly important, invest in videos, documentation and face-to-face time to help your people hone their skills.”
Santiago also recommended holding training sessions and tastings, which Hermanos host for their staff once a month. “We are a specialty shop, so everyone needs to be confident in talking about coffee. Passion is the most important thing, though. You can have the best coffee in the world, but if your people aren’t passionate about it, it won’t work. You can teach everything,” he told us, “but you can’t teach passion.”
A coffee shop without repeat customers is a coffee shop that won’t last. Loyalty cards are one thing, but becoming a habit in the daily lives of your customers is much more complex. “The best way to build loyalty is to be really good at what you do,” David told us, citing social media and email marketing as effective ways to encourage repeat custom. “Ultimately, the best brands build customer loyalty by offering the best product and the best service.” Santiago echoed this: “You can’t get complacent if you’re told that you’re the best, you have to keep going and strive for consistency. That’s how you build real loyalty.”