5 Key Steps
This podcast is going to focus on answering very specific questions like is starting a coffee shop business a good idea?
Check out Wake Oasis Coffee most recent podcast episode here:
Jeff Vojta from Dilworth Coffee – Dilworthcoffee.com
Paul Peterson owner of Wake Oasis Coffee – www.wakeoasiscoffee.com
Franchise Information – Click Here
Paul Peterson
Welcome. Welcome. Welcome. This is the roast brew sell podcast. This is the podcast for coffee, business owners, and those looking to get into the coffee industry. This podcast is going to focus on answering very specific questions like is starting a coffee shop business a good idea? Those who own a coffee or coffee related business, or those interested in breaking into the coffee industry or owning their own coffee business someday today we have Jeff Vojta. Jeff, could you introduce yourself?
Jeff Vojta
Sure. I’m Jeff with Dilworth Coffee. I’ve been in the coffee business for over 25 years now from owning operating stores to sourcing and roasting great coffees and working with a lot of our customers on setting up coffee shops and coffee concepts across the country.
Paul
That’s awesome. And how long have you been doing this for?
Jeff
Jeff
Since 1994.
Paul Peterson
Oh man. I bet you’ve seen a lot of changes haven’t you?
yes. I mean, I, I never would have envisioned the coffee industry being where it is today and still growing as rapidly as it ever has.
Paul
Awesome. Well, I think we’re going to have a great conversation today. My name is Paul Peterson. I’m with Wake Oasis coffee. We own a couple of the best coffee shops in Apex, North Carolina. we focus on amazing customer service and delicious coffee. we serve amazing delicious cups of joy to our customers every single day. So I think my experience and then Jeff’s experience in the coffee industry. The two of us together are going to help answer some, very poignant questions and hopefully we can deliver answers to people that are helpful. The question that we’re asking today. Yeah, I think it’s going to be a lot of fun. The question we’re going to answer today is how do you define or create a vision for your new coffee shop? So, Jeff, I’m going to toss that up to you for those who are looking at owning a coffee shop, and they’ve always dreamed about it. They’ve looked at doing it now. They might be getting to the point of being able to pull the trigger on that dream and move forward with it. What are some of the steps they should take a look at to try to help define that vision and create the vision for their new shop?
Jeff
I always start big picture and starting a coffee shop is like much like starting any business. You really have to dig deep down into why do you want to first and foremost own your own business? What do you want to get out of owning this business? What are you looking to try to provide differently that you think is not in the market place? And everybody’s vision is going to be somewhat unique The really big picture items are a great place to start because it’s not a quick fix. It’s not a 90 day process. It’s going to take you a while to get it open. There’s going to be long days. Once you do get it opening, before it finally gets to probably the vision or the dream that you would want for, you know, what the operations would look like.
Jeff
So I always ask people to really start and really define. Are you looking for a lifestyle thing? Are you looking for extra income? Are you looking, , to fulfill type of passion, whether it may be baking items and cookies and you want that, what the coffee go along with that or compliment that business? , if you really feel there’s some social outlet or whatever missing in your town, your church, , your organization or something at work, there’s a lot of reasons for wanting to start a business for starting a coffee shop in particular. So I was really trying to understand when you get done and you stand back and look at this after year one, year two year five, what is your vision of success? What is it going to look like to you? And then how would you want to sort of describe it? We call this the Five P’s. And I think starting there is really kind of key to helping to find where, what we need to do to get the coffee shop started.
Paul
I think that those are some good points. I think it’s hard for people to visualize that. I think that there is the dream of owning something. And then there’s the reality of owning that something. And I think that one of the things that I’ve noticed is, as I’ve gotten more and more involved in the coffee business and the day-to-day management of owning coffee shops and dealing with vendors and customers and, delving into the financial side and all of that other stuff is that it is you have to really want to do coffee, but you also have to really want to do the other stuff. You have to want to market. You have to want to sell your shops and sell your vision, and you have to want to work with vendors and work with people and manage a staff. So I think those are, yeah, those are important key things to think about and, and reconciling the reality to that dream. Sometimes it’s, it’s good to be able to give some people a reality check up front that it’s all not, , lattes and cappuccinos. Sometimes you’re going to be elbow deep in grounds and scrubbing toilets.
Jeff
Yeah. I mean, I never knew what snaking a toilet meant until I owned it. So that was a skill set. I was like, I’m like, what?
Paul
Right. And it always happens. Oh yeah. It’s kinda like somebody is out sick and there’s a line out the door. I remember when I first had the shop, we had a line out the door, cranking things out. I’ve got a little bead of sweat coming down my forehead. And I chose that time to spill a whole hopper worth of beans all over my feet, fell into my shoes. And it felt like some sort of medieval torture because I’m sitting there trying to dole out drinks, pulling shots and steaming milk while I’m being forced to walk on these coffee beans that are in the bottom of my shoes. One time it took for me to learn that lesson.
Jeff
Yeah, there’s all these little ones it’s like going to tell people after doing it for so long, it’s like, well, you know, I’ve tried it and had these things happen. So hopefully you’ll be lucky and won’t get them, but I’ve learned, this is why you plan and do these and listen upfront. Because if, if I, if could do it wrong, I did it.
Paul
Yeah. I, understand it well. And I think that you probably learned a lot of things along the way as well. So, you had mentioned before the Five P’s (Place, People, Product, Profit, Promotion) when you talked about opening a shop, could you start walking through what some of those are? And I think that will help people kind of dig in a little bit more tightly and really help create that vision for what they want their shop to be.
Jeff
Yeah. I think like everybody is after having done this long enough is a lot of times when we meet with the new store owner, I’d always start asking a lot of questions and they really come around and what I call, you know, what we’ve eventually driven, drill down, distill down into what we call The Five P’s. The first P is place it’s where do you want your coffee shop to be located, in which city, which town, off an interstate, in an office building. It starts there and then, how big a store do you want? Do you want to drive through, do you want outdoor seating? What kind of decor do you want is what’s the community? Is it a seven day, a week, kind of residential neighborhood five day a week, office park, are people going to be walking to your store and hanging out?
Jeff
Our second P is people. I mean, people are probably the most critical, so it’s not only from who your customer is going to be. Who will your staff be? who your vendors are going to be? What’s your neighborhood? Like? What are people looking for? , it’s kind of try to envision, when you have this shop who is the person who walks in, what were they doing before the shop? if they were on the way to work, trying to get the kids to school, etc.
Jeff
And I got to get to the office. So, that’s one thing. And then, where are they going afterwards to school to drop the kids off at daycare? Oh, we’re going to pick them up at dance practice, whatever the case may be. That’ll kind of help you sort of define the theme. The offerings, speed of service and some stuff like that. But, obviously your customers are gonna make or break the business. Your team of people will make or break it. So sort of taking your pool of talent, your, the resources and stuff, they are vital. And, for me, for operating the coffee shop, I really loved the people we worked with. I loved our vendors. I loved our customers. And, twenty-five years later have many of the same customers that we had in the very first day.
Paul
I think that’s one of the aspects that I think that as you get into the coffee business, that’s one of the most gratifying aspects is the, the ability to actually impact and work with, not just talented people on your team, but then you get to serve drinks and, and interact with your community in a way that most other businesses just aren’t able to, and to be able to have those relationships, like you talked about, after all those years, that’s special,
Jeff
I think so. I mean, again, I do it for the people, the relationship and the things on there, and, and that was, has been center of our business. Then as we go a little bit more, we get down to the third P, which is “product”. Products are a lot deeper than just the coffee that you serve is how are you going to serve it? The menu, the options wide variety. Is it coffee? What kind of drinks? And what alternate drinks, not everybody drinks, coffee, not everybody wants coffee, 24 7. So really trying to fix that. And then, and again, back to, where people were coming from and where are they going? They’re going to need some breakfast or nourishment on their morning commute to work well, the kids need, a snack or lunch or something, , possibility, going off to school or daycare, camp.
Jeff
So it was really, really thinking about what you want to sell, how you want to sell it. And then, once you kind of get that down in your menu, what, what kind of people do you need? What kind of equipment is a space big enough that you have the vendors in the supply chain? Are you going to need special licenses, , and training. If you want to run in to sell beer wine, that’s a whole another set of regulatory offerings. If you’re doing a lot of retail products, baking, different kind of food service that may require some different licensing. So just kind of really understanding what you want to offer up front is going to be critical to make sure, you’re getting your business up and going to be successful.
Paul
I think all of that, when you’re looking at it, you have your product and you have your people, those are important things to consider for your location as well. When you’re taking a look at the place and trying to figure out, okay, well, if you want to have a community atmosphere where maybe you want to have game nights or trivia nights, and you want to be able to have church clubs and book clubs and other people like that meet in there, then do you define a space that has, a gathering room? Do you have places that are walkable? Like, do you have that set up, or do you try to find a location that has that sort of infrastructure set up for you and the same thing for the products? I mean, if you designed it to bake your own, muffins and pastries and things like that, in there, then you need to make sure that you find a location that has sufficient power load and has a specific place that you could do that with racks and space for your oven and all those other items.
Paul
You know, if you want to do big vats of cold brew, how are you going to have that setup? Where’s it going to be? Are you going to have a large kind of a soup faucet that you have set up, what are these things that you’re going to have set up for you to actually meet the needs of the people through your products? And so, yeah, it’s funny how all of those aspects just tied together.
Jeff
Okay. It does. And I mean, and even to figure out how to make these things, I mean, I learned real quickly, somebody asks, well, is that single phase three phase power? And I was like, , well, powers, power in. And they’re like, oh, no, no, no. And then how many dedicated circuits and what amps, and I’m not an electrical engineer. So it was kind of, I’m sitting here. Okay, well, I better need to learn some things real quickly. So again, knowing what we needed to do, where to spec stuff, it was hugely important. As you were kind of alluding there, with church groups and different things is, it’s like you do all this great work and, unlike some things, they think he would build it and people are just going to come, be nice.
Jeff
But there’s very few businesses that, that I think happens. You mean coffee shops. The 4th P is “promotion”. How are you going to let people know where you are, who you are, what you sale, what’s going on? , whether or not it’s going to be through social media, community groups, the gorilla marketing, It’s, how are you going to keep, as we always looked at it kind of like our fat acronyms. So, we got to get customers to come in the first time that’s trial, they’ve got to try you, they got to get used to you and what you’re offering. You want them to come back more often. I mean, people coffee every day. So do you have the right offerings and stuff and doing the right things that, that person’s going to come back 2, 3, 5 times a week, maybe, and then I’ll go, do you have more things to sell them? Whether it’s just a cup of coffee, can you get them another drink? Can you sell them a muffin or a pastry and your other things, you know? So as you look at all of that, you’ve got to really kind of, you know, make sure you’re doing all the right kind of, when we call promotion, it’s not just a sale, it’s not just to give away, but it’s just letting people know who you are, where you are again. And so they want to come and try your products and come back more often.
Paul
I think that makes perfect sense. I think that one of the things that I’ve noticed, new business owners getting hung up on are they feel that somehow promoting is like a dirty word, like it’s a bad thing to do. And I’ve just never viewed it that way. Promoting yourself and promoting your business. You’re actually giving people an opportunity to be served. You know, if you’re telling them about something that you have, that’s delicious and they come up there and buy that thing that is delicious. And their life is enhanced by the service and the product that you’re able to sell them. Then through promotion, you’ve actually been able to help people. And I think that that’s one of those things that is important, that you shouldn’t be shy or bashful about telling people about, Hey, we have delicious drinks. You should come on up.
Paul
We have an amazing place for you to sit, bring your family up. We love having kids up there. We have cake pops, we have delicious smoothies, you know, have you ever tried a brown sugar latte? It’s my favorite, come on up! It’s fun to be able to talk about those things. And I think that you have to be able to learn, to feel comfortable to get out of your shell a little bit and to be able to talk about some of those things, , because if you don’t feel positive and, enthusiastic about what you’re selling, then it’s hard for other people to feel as positive or enthusiastic to come up, to buy what you’re selling. So it kind of goes hand in hand, which I think that brings us to the last P, which is the one that I think that is sometimes the one that people, people trip over a little bit “profit”.
Jeff
Right. And ultimately when it’s all said and done, and I would have to met even some coffee shops who we worked with with, and non-profit facilities, they all ultimately want to make a profit. They’ve got to reinvest in the people, the equipment, the store and stuff. So, you’ve got to make sure that you’re selling things for more than they cost. And that includes your overhead and includes your replacement, costs, maintenance and things like that. So really trying to work there and understand. So once you get the menu, once you get the place, the equipment and stuff is really understanding. And I never knew this. It’s like, well, how much do I price a cup of coffee? I hear there’s great margins. It’s costing me 50 cents or whatever. What do you sell it for what standard? I mean, and having the right financial advisors and some of the right people have been there before, it’s helpful to see like, oh, that’s why these things cost what they do.
Jeff
it’s not just, I’ve heard all sorts of different pricing formulas. And again, it’s different in different industries and different businesses, but really trying to get a handle of that and understand where it is. And then if you’ve got other expenses, whether it’s a lot of takeout, it’s catering, delivery models, understanding all the fees and which payment structure you need, the accept credit cards, are you doing tips? How does that impact what you pay your staff? All these things are going to impact profits. So really having, understanding these cost drivers what’s going on in the business, having good financial advisors, it’s going to be key to making sure your business meets that vision that you ultimately set apart for yourself.
Paul
At the end of the day, slow coffee shops don’t stay open. And that is the harsh reality. And so you can have a vision for this beautiful location and this amazing place with, tons of families and, gathering places. You can have these delicious, traditional espresso style drinks. You can, you can do all of these things, but, if you’re not promoting it properly and you don’t have the proper cost structure in, and you’re not generating revenue and then therefore not generating profit, you’re not going to be able to stay open. And so I it’s a, these are all really important points. And I think anybody who’s thinking about getting into the coffee business and owning a coffee shop, this is really, these are these, these five PS are really, it’s really key information for people to really sit down and think through. And, especially recognizing that, the math has to work. and I think that’s where it’s important that all of these things kind of coalesced together into a cogent plan. And, , I really think that that what you’ve outlined can help people form that, that vision for their place and help be successful.
Jeff
Well, that’s good. And I, and there’s no guarantees for success in just in business. We all dealt with the unexpected, and the last two decades, especially. But I think thinking about these things, analyzing them is you’re going to set your business up, much more likely to fulfill your vision or your dream forward than just if you like up, there’s a great space. The lease is right. We’re just going to go lease it and, and hopefully you build it and they will come. there’s been some that way, but more often, it’s just a lot of hard work day in, day out and getting, doing your homework up front and thinking about these things I think are critical to, setting yourself up for success.
Paul
I think that makes sense so, well, I appreciate it, Jeff, thank you very much. And if people want to reach out to you, how do they get ahold of you?
Jeff
We’re at Dilworthcoffee.com or vojta@Dilworthcoffee.com.
Paul
Awesome. And my name is Paul Peterson. You can reach me at Paul@WakeOasiscoffee.com or www.wakeoasiscoffee.com. Jeff. I appreciate it. And we’ll talk soon. Have a great day my man.