Economic Crunch: How Will It Affect Our Business?
I would love to hear what you think the repercussions of the economy will mean to the coffee industry.
I have my inclinations and will share when the discussion begins to roll.
I have my inclinations and will share when the discussion begins to roll.
Replies to This Discussion
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Permalink Reply by javaqueen on
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I am loving this discussion! Kudos to all!
Remember, all of our shops are in different neighborhoods and markets.
It's our job to know our market and if a survey of any kind doesn't work for you, well that is your business.
Literally, eh?
Just being able to bounce things off of each other is worth a fortune!
The fact that the corner coffee shop with their 'bad coffee' has a loyal following is a perfect example of why we need to know our clients.
We know that their habits will change and we want to be able to change with them. That's the crux of the idea of talking somehow with our customers.
What can we do for our customers to make them more appreciate our shops and our wares? How do we respond to the change in the financial environment?
BG... I totally agree... many will simply change their habits. People need the rewards of a treat once in a while. What treats will they want and can afford? Will we be proactive and ready to respond or try to react to the market?
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Permalink Reply by Mike on
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One thing that I have not heard is a reality we must remember. We are entertainment and a comfort beverage. In the great depression the entertainment industry thrived. People still want to be entertained and comforted. I think we would all agree that when times are hard or your just a little down, a good cup and a sweet treat with a little good conversation can make it brighter.
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Permalink Reply by Bel Townsend on
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That's it exactly - I was talking to a coffee shop owner recently who in his perma-cheerful (naive?) little way, hoped that if anything, the coffee shop would do better - people are less likely to splash out on big treats nowadays, such as eating out or having weekends away, but consequently they might be more inclined to have more 'little' treats - coffee, cakes etc to make up for it. I really hope that is the case.
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Permalink Reply by Brady on
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Not to mention a place that our employed customers wish they could spend more time. I was out of work for several months a few years back and spent many happy hours at my local shop "working on my resume". Though I guess I was sipping very slowly on a small coffee the whole time.
At least I never ordered a double espresso in a medium cup...
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the stuff i found out from customers is on my blog now if anyone's interested!
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Permalink Reply by Mike Spence on
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I've been following this thread for a while now. As a supplier it's interesting to see what all of you think about the economy. For us, Coffee Fest was kind of interesting to see the attendance. Overall the show was down but the customers in our booth were the same as last year.
The real interesting thing to see was how many of the customers (coffee shop owners) were more business savvy and already had locations. Very few "I'm opening a business in the next year" type people. I've been asking here and there for the last couple months what people thought about the economy and how it affects them.
The general consensus seems to be that this is an industry that can survive these types of economic downturns. The smart owners who pay attention to the bottom line, keep an eye on inventory, watch out for theft (and of course buy a POS <---- shameless plug) are able to move forward.
In some cases the shops that have problems (in my experience) are the ones that have owners who are off site, not business minded to begin with etc.
My two cents! I'm back to the phones.
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Permalink Reply by John P on
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First off, Economic Crunch, for your average citizen, is really a fallacy. But that's for another discussion. So the perceived economic crunch really won't have much overall effect on the higher end shops (or restaurants). The biggest loss will be the chains, and the chain-copycats. In times of economic uncertainty, people tend to pay more attention to WHERE they spend, rather than what. So the customer who spent $20.00 a week at a chain is more likely to spend that same $20.00 on less, but higher quality, coffee/drinks than not spend at all.
When people watch their money; value matters.
$2.00 latte at avg shop, bad value.
$4.00 latte from somewhere exceptional, good value.
So the best way to gain customers is to keep doing those things that separate you from the fray. Any newcomers will soon see that their money is much better spent at "your" place.
Here is an example from my blog that I will quote,
"The Jesus Principle, Coffee, and the Truth of Recession:
No, not the mythical religious icon....
Jesus, as is (hey-soos) [real name unknown] is a former veteran who's lost most touch with reality and is a semi-transient artist who has been coming to our caffe off and on since our opening year.
Much can be learned about the truth of recession and how it relates to discretionary, or luxury, spending when you examine Jesus.
Jesus does not have a lot of discretionary income, in fact, he has little income at all. He receives a monthly check from the government, but most of his time is spent walking about talking complete nonsense and occasionally selling hand drawn artwork at the park for about three to ten bucks a drawing.
Compare Jesus to the overspending Yuppie or general young idiot. You have someone with a livable income who has spent well outside their means. Luxury items to them may not be a big deal, but the house they couldn't afford is, as well as their other mis-management of money habits.
Jesus has a usual routine: He quietly mumbles his order, an Americano--16 ounce, and sometimes gets two while he sits out on the patio and draws, mumbles about people chasing him with electric griddles (I kid you not!), or both.
He could walk anywhere and get a cup for a buck fifty or less, but with his limited resources he comes here. And as someone else was standing in line asking about the Americano, he brazenly mumbled, "best coffee in the city".
Those who have less, spend it more thoughtfully, and actually they increase the luxury, but decrease the frequency. Recession. Bull$hit. For those who have little money, spend wisely, like Jesus."
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Permalink Reply by Richard Penney on
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Well and truly said!
Thanks
-Richard
John P said:snip Those who have less, spend it more thoughtfully, and actually they increase the luxury, but decrease the frequency. Recession. Bull$hit. For those who have little money, spend wisely, like Jesus."
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Indeed... I agree, John and Richard... thought and a pro-active business plan will keep our customers coming. Knowing what we are to our customers and giving them what they are looking for, not just what we think they should want.
Pro-active rather than reactionary... reactionary will keep you behind the timeline... the proverbial 'day late and a dollar short'.
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I really like the Jesus principle.
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Permalink Reply by Kathy Fadorsen on
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You can not talk about the ecomony with out getting politics involed.This mess started with liberal thinking that every one no matter haw hard they work or don't work deserve the same things that I enjoy because it is owed to them. Well I have to say I get up every day at 3:45 in the morning and spend till sometimes 9:00 at night working my coffee shop. No one ever handed me anything. I don't except them too. But I will say if Obama gets in office I will most likley have to get rid of 3 or 4 employees to pay the extra taxes I will be required to pay.
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