Making a profit from small restaurants is hard. Making a profit from a café is harder. While wages increase, business owners are hesitant to increase the cost of their services to prevent customer upset. Since the pandemic, fewer people want to dine-in, let alone spend as much as they were previously comfortable with. And every month we’re seeing C-Price (Market price for arabica coffee beans) creep higher.
Operating a café is never easy, and the average profit pales in comparison to other business models, but focus on the right strategy, and you’ll be making profit an essential part of your local community
Optimising the Menu
Simple is better, easier and faster for everyone in the café, from your team to the customer. We’re talking basic in quantity and excellent in quality. A crowded menu is skimmed by customer eyes. You want to have a simple menu with a handful of unique items to hook the customers who are “just having a look”. Consider adapting the menu when you’ve identified a handful of low-performing products.
Grab-and-go options are essential. Small sweets like cakes and cookies made in-house or locally sourced let customers know they’re supporting the local community. Fresh sandwiches and cold drinks are an easy lunch for those on a short break.
So many businesses have gone cashless. Most Point of Sale systems can help you build an online remote menu, allowing customers to order remotely via QR code or website. Simplifying the buyer’s journey by letting them order right as they are seated makes for a smooth customer experience.
Invest in Your Café Team
The people who are interacting with customers everyday represent your business values and are a big part of the personality of your café. Investing in your team shows them your support and builds a healthy work culture that encourages your team to improve their work everyday.
Offer constant training, not just in coffee for budding baristas, but also in leadership and hospitality education for the rest of the team. This investment will be recognised by your customers through the service they pay for, and so will be pleased to hold you to a high standard for hospitality.
Providing incentives can invite healthy competition within your team. Maybe an anonymous team vote on employee of the month, or who made the most sales in a week would be enough to motivate the team. These days, a simple grocery voucher can be a valuable reward.
Reward Your Regulars
A loyalty programme is an excellent way to encourage repeat visits while helping your team build strong relationships with regular customers. Get creative with your rewards—whether it’s a discount on a popular item or a complimentary small treat after a certain number of coffees. Instead of giving something away for free, consider a discount on an item. Whether it be a coffee, a bag of retail beans, or a sandwich.
Reduce Wastage
Identifying and reducing wastage is a key way to streamline your operations and ensure that the money you spend on stock is generating profit. Tracking inventory minimises over-ordering, storage space is precious. Keep an eye on expiration dates and using the First In First Out procedure reduces food spoilage.
Use Social Media
Marketing your café is something business owners of ten years ago never needed to worry about. Now that it’s so easy to build your own online presence, it seems essential to have a basic understanding of Instagram algorithms and trends. Otherwise you become easily lost and scrolled past on the social feeds of potential customers.
Using social media can help show new customers what your business has to offer while growing the community it currently has. Creating content that is a healthy balance of food, culture and community is what attracts healthy engagement on any platform. It’s also a good way to stay relevant to the culture. You want to show enough of your menu items so people know what you offer, enough of your team to give your customers a behind-the-scenes look of the business, and enough community involvement to show authenticity. Running giveaways on Instagram is a great way to attract new followers who will learn about your café.
Offer Seasonal Items
Add limited items or promotions to your menu to generate interest and attract new customers to your café. A good promotion can reel in foot traffic on weekends where there are new faces in the area. You could have specials to celebrate holidays or local events to maintain relevance in the community. You could even notice new developments in the area and offer a tradie deal for the population of trade workers in the area.
Figuring out what promotion you can add to your offering is a matter of knowing what’s happening in your local area. Find those opportunities to attract a wider audience by offering something the community needs.
Optimising Café Layout
Giving your café the right ambience can encourage customers to stay longer and make more purchases. Creating an inviting space with ample lighting, comfortable seating and definitive ambience builds on café personality.
Perhaps you can build on a cosy environment with charging stations and Wi-Fi for people who simply want to sit and work on their laptops for a few hours while they snack on your food and drink your coffee.
Or offer plenty of standing space and upbeat music for a café that caters to the people commuting to work or prefer their morning caffeine boost on the go.
Regardless of the vibe you build, making sure it’s clear to your customers where to order, and where to wait/pick up their order, it’s crucial to making swift transactions. Optimising café layout improves customer experience and will encourage their return.
What to Stock on a Cafe Retail Shelf
Offer more than a cup of coffee. During the pandemic many people learned how to brew their own coffee at home. Whether they’ve bought their own espresso machine or a pour over kit, customers now hope to find a café that can help them replenish their stock of coffee beans, filter papers, and explore other mobile brew methods.
It doesn’t hurt to stock your retail shelf with both 250g and 1kg bags of coffee. Some home baristas don’t have a grinder at home so offer to grind the coffee for the customers after purchase.
If you want to stock brewers for home, a good selection to offer includes a V60, Aeropress and French Press. Make sure to stock the appropriate papers for brewers too, the idea is to make your café the only stop the customer needs to make to stock up on coffee goods. Additionally, you could offer anything on the retail shelf as a bundle. Customers enjoy bundles as gifts or as easy transactions to expedite their home barista journey.
Other items you can add to your retail shelf could help it evolve into a pantry shelf. You could sell the milk you stock at the café, ingredients you use in the kitchen, and café merchandise to spread brand awareness.
Operating a café isn’t as easy as many assume. The product doesn’t speak for itself, you need a strong and invested team to deliver hospitality, with a good sense of community to better understand what your customers need. We’ve shared these tips to help you find additional profit streams beyond simply raising prices. Many of these strategies are already being successfully used by busy cafés around you, so take the time to visit and see what works. You may find that small adjustments can lead to big improvements in your café’s profitability.
Leave a comment