You will need to sell lots and lots and lots of coffee
“Warning: You're not going to make any money. Just kidding! But it's pretty hard.”
- Rebekah Yli-Luoma, Heart Roasters (Portland, OR)
If a Ferrari dealership sells one car a day, they're in great shape. But, unless you're selling gold cups laced with actual gold, you will need to sell lots and lots of coffee.
Coffee is a low-margin, high-volume business where most of the sales happen before 11am. According to Sam Penix from Everyman, it might take two to three years to become profitable. Since volume is key to success and success is a long way off, efficiency is incredibly important. Any bottlenecks in your customer flow will lower your potential volume, not to mention frustrate customers.
One of the keys to maximizing volume is to consider the barista's processes and the way that the customer interacts with them. If you go with slower pour-over brewing tools, they need to be positioned so that the customer can see the process and the barista can chat them through why their coffee is taking so damn long.
Another important thing is to analyze the flow of customers. Coffee doesn't have to follow the same approach as fast food, where you pay, move to the side, then receive your drink. It can be a Chipotle-like assembly line where the coffee is ready by the time you pay. Or a model that closer emulates a regular bar, a diner, or even a table service restaurant. This is a decision that affects customer experience and has a very real consequence on the bottom line.
That bottom line will be heavily buoyed by selling things other than coffee. Beer, wine, liquor, sandwiches, magazines, coffee gadgets, bicycles, records... almost anything. It is very hard to succeed without an alternative revenue stream, so consider what else you can offer your customers other than that $4 cappuccino.
Pricing that capp is a balancing act. "There's a fine line between being a treat and part of someone's daily ritual," says Mike McKim. Everyone has a personal value equation, and, if you don't nail it, they're not coming back. If your shop is a destination, you might be able to up the price. If it's in a high-volume commuter location, you might have to lower it. If you're next to a Starbucks, good luck.