How To Start a Coffee Shop Successfully in 2024

So you want to open a coffee shop? Great! It’s true that owning a coffee shop can be extremely profitable—as long as you do it the right way. With a good plan in hand, you might be able to convert your love for hot beverages into a successful business.

Starbucks is a perfect example:the first Starbucks café opened in Seattle in 1971. The owners didn’t have much in common with each other, aside from their shared background in academia and their love for coffee and tea. Nowlook where it is today! With over 31,000 locations on several continents, Starbucks is the largest coffee shop chain in the world.

So, if you’ve been thinking about opening a coffee shop, here is what you need to know about  starting and bringing to success at such a business.

How to Get Started

Generally speaking, there are three ways in which you can become a coffee shop owner. You might:

• Purchase a franchise– if you choose this option, you won’t be the one making the important decisions, since they’re all made at the corporate level. In exchange for a franchise fee, you will be given a turnkey business in the location provided by the owner of the franchise.
• Purchase an existing coffee business – this is probably self-explanatory. The problem with this one, however, is finding a profitable business for sale.
• Start from scratch– while this option is undoubtedly the most challenging, it also gives you the most flexibility and the most potential for maximizing profits.

Regardless of where you start, the fundamentals of what makes a coffee shop successful are the same. So let’s take a look at the next steps.

Create a Business Plan

You might be tempted to skip writing out an entire business plan, since you’ve already got your plan in mind. It may seem like it’s just too much time-consuming work when you could be touring locations or designing signature drink recipes. However, skipping this would be a huge mistake. And it’s not even about the document per se – it’s about going through the process, during which you’ll gain a better understanding of the local market, as well as take a closer look at the numbers you’ll be constantly monitoring. As you make your business plan, you’ll learn everything you need to know about how to run a successful coffee shop in your area.

A coffee shop business plan should include information such as:

• The specifics of your business operation, your estimated costs for opening, and how you will make a profit
• Your target customer base and the identity of your competitors
• What tasks you’ll be performing yourself, and what other team members you will need to hire
• Financial projections – projected profit and loss, cash flow

A good coffee shop business plan will act as a guide through each stage of opening and managing your business, making the whole process easier.

Find the Right Location

Finding the right location is probably the most important aspect of opening a coffee shop, as it can either make or break you. If you’re purchasing a franchise or an existing business, the location has already been determined, but you should still take some time and do your own research to make sure that it suits your goals.

There are a few things you should keep in mind when looking for a place for your coffee shop. First of all, central locations, although very tempting, are usually not the best choice for starters – especially when you take into account how expensive rent is. Instead, consider storefronts.

Secondly, think about easy access to parking. If a customer has to leave their car on another street because they couldn’t find available parking on your shop’s street, they’re likely to choose a more convenient option. And last but not least, bike racks. With the growing popularity of people using their bikes to commute, having a secure lock-up for bicycles is a necessity.

Look for the Best Suppliers

Having the right suppliers is a major component of any business’s success. Part of understanding how to run a coffee shop is making a list of all the things you’ll need. Depending on what type of coffee shop you want to open, you are probably going to need suppliers for milk, coffee, tea, bread, groceries, fresh produce, cups, napkins, syrups – the list could honestly go on and on.

Once your list is done, you can start researching the options until you find suppliers that can meet your needs and fit in with your business philosophy.

Invest in Equipment

What you need to open a coffee shop includes some pricey equipment. There are a few ways in which you can acquire the equipment you need. First of all, you can buy it outright using your own money. Secondly, you can lease the equipment – the owner will give you their property in exchange for regular payments. Last but not least, you might be able to get it on loan from your coffee roaster.

Commercial blenders, an espresso machine, cash registers (preferably with a point of sale (POS) system), dishwashers, and refrigerators are just some of the equipment you will need. To ensure that all the necessary equipment is there for the opening of your coffee shop business, you need to make your list as detailed as possible.

If you don’t have the finances for everything you’ll need, or simply don’t want to invest too much money in case your business doesn’t do as well as expected, take a look at the list you made, and decide which positions on it are a priority – you can always buy the rest later and improve your shop’s offerings.

Make Your Coffee Shop Unique

Knowing how to open a coffee shop is one thing, but attracting customers and turning them into repeat visitors is another. To keep them coming back, you’ll you need to provide them with something they will not find anywhere else. Design is a great place to start—if your coffee shop looks like any other in the area, chances are people will visit once and forget about it, or at best, only stop by when it’s convenient, instead of considering it a destination worth its own trip.

The design concept for your coffee shop will largely depend on your target clientele – for instance, if you want to appeal to people with children, the design should be family-friendly. Just keep in mind that you cannot please everyone, so instead of trying to combine several themes to make sure everyone will be happy, choose one and stick to it.

When coming up with the design for your coffee shop, don’t focus solely on the interior – the exterior is just as important. After all, it’s the first thing a potential customer will see, and many people make the decision whether to enter a coffee shop based on how it looks from the outside.

Create a Great Menu

Think about what types of hot and cold beverages you want to offer. Classic espresso drinks? Lots of flavor options? Some fancy iced coffees or teas? The decision is up to you. Just make sure that your customers have a nice selection to choose from. If you can, also add customization options such as alternative plant milks or even a different coffee variety.

Don’t forget about snacks and small meals – while coffee and tea have a high markup, a coffee shop cannot really be successful when having only those to offer. If you’re considering how to start a cafe business, here are some foods to consider adding to your menu:

• muffins
• sandwiches
• cakes
• cookies
• granola bars
• yogurt cups and parfaits

Although you might want to have made-to-order food at your location, the truth is that doing so is very time-consuming and can negatively affect your sales. It’s best to either have everything pre-made, or simply buy your food offerings from quality vendors. When it comes to baked goods like cookies or cakes, you can buy them wholesale from local bakeries.

Hire the Right Staff

You may want to start out doing everything yourself to save money, and this might be possible at first, when you don’t have many customers. But as soon as your business starts to grow, you’ll have to hire at least one or two people to help.

This is where many people opening a coffee shop can make a mistake by only looking at an applicant’s experience. While this is understandable, there’s one thing that beats experience in importance, and that is attitude. Remember, skills can always be learned, but attitude? Not necessarily.

Creating a great team culture is not possible if you don’t hire the right people, so make sure that you choose those candidates that fit your business best – even if they don’t have experience. However, if you don’t know all the ins and outs of how to manage a coffee shop, hiring someone with that experience early on in your coffee shop’s journey can be very helpful.

Network as Much as You Can

Having a good location, specialty coffee, or great employees might help you succeed in opening a coffee shop, but these things can only get you so far. In order to gain a foothold in your local area, you need to use your networking skills. Join a local business association or chamber of commerce, partner up with a local charity, run a table at the farmers’ market – it doesn’t matter what you do, the important thing is that you stay visible in your local community and gain dedicated partners even before the doors of your coffee business open.

Come Up with a Marketing Strategy

Along with networking, you should start marketing your coffee shop well before your opening date. Contrary to what some people might think, you don’t need a huge budget to be able to properly advertise your coffee business – there are plenty of affordable ways of doing it.  For instance, you can partner up with local businesses – in exchange for on-site advertising, you can provide them with free coffee. Or you can take part in local events and offer samples of your drinks to other participants.

Social media also plays a very important role in marketing. People love finding a new coffee shop or café on Instagram or Pinterest, and there are always opportunities to work with local influencers. A good idea is to place a poster in your shop with the offer of a one-time free item, like a cookie, with their order when they follow your business page.

Additionally, claim your Google Maps listing so that when people search for a coffee shop in your area, they will see yours on the list, as well as on other review sites. This will also let you easily review and address the feedback from your customers.

Consider Starting a Loyalty Program

We all know that people love getting free stuff, even if they have to make some purchases first. You can either come up with your own idea for a loyalty program, or you can use one of the classic ones – buy a number of products or spend a certain amount to receive a gift.

There are a few reasons why loyalty cards are a good choice. First of all, they encourage regular clients to visit more often. Secondly, it improves your chances of an infrequent customer choosing your business over your competitors. Last but not least, it might encourage your clients to spend more (depending on what type of loyalty program you introduce).

Be Yourself

Now that we’ve discussed the basics of how to start a coffee shop, there’s one last thing to mention. Remember, people don’t go to independently-owned coffee shops for the chain coffee experience. They go because they like the individuality of that particular shop and appreciate what that coffee shop does well. Decide what your coffee shop is going to be about, and stick to your guns. If your coffee shop has a laptop-free zone, enforce that rule. If you want to play really niche music, go for it. The important thing is ensuring the way you’re running your coffee shop fits the community you’re a part of.

Once people know who you are, they will come for the experience. Once you have a distinct personality, you can brand yourself. That’s where we come in. Our custom coffee sleeves are a great way to personalize your business. If you’re just starting out, we offer you the service of ordering a small number of coffee sleeves at a time for an affordable price. That way, you can brand your coffee shop from the beginning without having to invest too heavily. Contact us to learn more today!