We continue talking to owners and managers of the best coffee shops and roasters from across the country about their experiences and business insights on different topics in the coffee industry.
Today’s topic: “Is location really that important for a coffee business and how did you choose yours?” Here are their answers:
1. Before Deciding Where Your Coffeehouse Will Be, First Decide Who Your Customer Is And Who You Are
Mike from Batdorf & Bronson Coffee Roasters (Atlanta, GA)
As a coffee roaster and a coffee retailer we deal with the question of location constantly. We talk to people every day who are opening coffeehouses or looking to improve business at existing coffeehouses. Location is the first thing we look at when evaluating their potential and how we can help them. When we open one of our own Dancing Goat coffeehouses, finding the right location takes longer than any other part of the process. We are unreasonably picky, infuriatingly picky about location. But our coffeehouses perform far above the U.S. average in terms of revenue. There are several reasons for this and picking the right location is one of the most important.
Having been a coffee retailer for 30 years we have a clear advantage when it comes to the most important questions about location, questions a prospective business may not know how to answer: “Who is your customer and who are you?” People get excited about finding a location because it is such a concrete action, it’s doing something instead of just thinking about doing something, which they may have been doing for years already. Too often, people start looking for a location before they have a clear picture of who their customer will be and how they want to operate. Before looking for a location you must commit to paper a detailed profile of what you want your business to look like, physically and operationally. Imagine standing in the middle of your coffeehouse. Who are your customers? What are they doing while visiting your coffeehouse? Did most of them drive or walk? What’s on the walls and what do the walls look like? What time did you open and what time will you close? Finding a location that serves your vision is hard and takes time but it is immeasurably better than being saddled with a location that is ultimately incompatible with how you want to do business.
Those are some of the intrinsic issues around location, but the extrinsic issues are just as important. It doesn’t matter if 400 cars drive passed every 10 minutes if you only have five parking spaces, or if most of those cars need to make a left hand turn against traffic to reach you, or if they can’t see you are a coffeehouse until they are almost in front of you. You’re counting on foot traffic? Great. How many people can walk to your location in less than 10 minutes and what are their demographics? In Atlanta we have two coffeehouses only 4 miles apart but the customers are dramatically different and if we picked these two stores up and switched them neither would be as successful as they are now.
Sometimes it’s difficult to convince people to imagine what they want their lives and their business to look like five years after they open and fully conceive their brand before they start thinking about, let alone looking for, a location; but we have been selling coffee to coffeehouses for a long time. Again and again we see people struggle when they’ve decide where their coffeehouse will be before they decide what it will be, who they will serve and how.
2. Or Do Just The Opposite — Find A Great Place, And Then Develop Your Concept
Sara from The Coffee Alley (Chicago, IL)
Location is very important for a coffee shop, because coffee business is mainly walking traffic, as parking is usually hard, and you won’t get as many customers as those that pass in front of your store.
We chose our location by thinking first where we wanted to open a business — not too far from home. It took us more than a year to find the right place. Some people don’t have as much time to plan, but this part is so important for the success for the business.
We developed a concept after we found the right place. Of course, we planned ahead funding for the business, so important also. Many businesses can not make it to the open the doors, because they do not plan enough, it takes about a third more time and money by the time you are ready to open your business.
My tip — find a place and look at the surrounding, the people walking by, and develop the concept and the idea according to the needs of the place, not backwards.
3. Talk To Or Partner With A Real Estate Expert
Nick from Bluestone Lane (New York, NY)
Having the right real estate is absolutely imperative when developing or operating a coffee business in New York. So much so, it’s in fact a little bit disheartening as real estate is the biggest barrier of entry in New York and can also be the element that has the greatest impact on success or failure.
There are so many food & beverage retail businesses that have had wonderful products and value propositions, but they fail because their location and the terms are not commensurate with what their business model. Too much rent or too little rent meaning they are not attracting enough customers and traffic.
It also does have one positive in New York, it weeds out, quite brutally, mediocrity. If you don’t really know what your business is and what you’re offering customers, then the high fixed costs associated with real estate can very efficiently put extreme pressure on the business viability.
In planning Bluestone Lane I had identified the need to bring into the team an experienced local NY retail real estate partner (Jon Krieger). Jon has been indispensable in finding the right locations for Bluestone Lane in our short history.
4. Look For The Place That Feels Right For Your Business
Brandon from Overflow Coffee Bar (Chicago, IL)
“Is location really that important for a coffee business and how did you choose yours?”
You can have the best concept, but the location and cost of the location are super important things to consider. I’ve also learned that no location will have everything.
With that said, I kind of feel our location found us. We knew we wanted to be in the South Loop of Chicago. We also knew that it would be an uphill battle choosing this neighborhood, because it is not built up yet and it is in the process of huge growth. There are lots of people and development, but not many businesses last more then a few years, unless they have huge financial backing.
First off we wanted to be more then a coffee shop; we wanted to build a community. A new friend at the time had an idea of a community center with a coffee shop in the center. The Daystar Center is a not for profit community center where we have classes such as piano and Zumba as well as an event space where we can hold larger events for the community. We thought that would really fit what we were going for. However, we are not close to any transit or have the density that the North Side of Chicago has. We decided to do it anyway because it aligned so well with what we hoped to accomplish.
We are now 4 years in and both groups are maturing and growing, and as people come to yoga they get a coffee or the other way around. We have been able to hold small conferences and other cool stuff because of our location, but the trade off of the slow growth can be difficult. My big piece of advice is look for the place that feels right for your business, and with every location there will be trade offs and sacrifices you have to make.
5. Follow A Simple Rule — Pick Spots Near Both Residents And Offices With Good Visibility
Bobby from Demitasse Cafe (Los Angeles & Santa Monica, CA)
We definitely think location is that important. While people may drive for amazing coffee once in a while, the kind of volume a small coffee shop needs to survive relies on regular, repeat customers. If you’re not in a good location for a decent number of people, you have no chance.
We tried to pick spots that were near both residents and offices that had good visibility. It was really as simple as that.
6. Sometimes It’s A Matter Of Pure Luck
Anya & Matt from Café de Leche (Los Angeles, CA)
Image of Anya & Matt by Andrew Gotch
If your product is good enough I do think that people will find you, but a good location can really make it a lot easier for people to find you.
For us, finding a location was a process that took many months and took many turns that at first appeared to be problematic, but ultimately turned out to be the best thing we could have asked for. We attempted and failed to lock down two other locations before finally finding our current space – a perfect, high-ceilinged, brick, 1920’s, corner spot on one of the main drags in our neighborhood. In retrospect, the other spaces didn’t come close.
I’d love to say it was my sharp eye that made us keep looking until the right space came along, but in retrospect I’d say it was dumb luck. Really, really good dumb luck.
7. Finally, Remember That Even Though Location Matters, Quality Of Service Sets Precedence
Orgena from Kaffeine (Houston, TX)
Location, Location, Location… is what I was told years ago when I decided to open my first American traditional restaurant. However today, location may not be so important for coffee shops. Highly populated areas such as malls and shopping centers are too costly and crowded. Inflated rent and taxes warrants permanent book ends to your business.
I focused on the neighborhood I grew up in, which happens to be minutes from downtown Houston and nestled in the heart of the Museum District at Museum Park. A fusion of urban living and commercial real estate quickly populated this area with professionals, stay at home moms, artsy and mufti-cultured individuals. A perfect blend for Kaffeine!
Although location matters, I feel your services and quality of your product is just as important and will create a memorable experience.
On any given day, we all are blocks or minutes away from getting a cup of coffee… But it’s when we make the decision to drive pass all the others to arrive at “our favorite” spot for our favorite “cup of Joe.” That’s when location plunges and quality of service sets precedence.