Buying an existing business
In my quest to open my own shop, I've always assumed that I would start from scratch, or maybe re-open a failed location with my own brand, style, etc. However, I'm looking at an opportunity to purchase an existing business that has been operating for at least 10 years, and I'm curious to hear what experiences you all have had with this kind of thing.
Assuming that the financials, traffic counts, etc are good, what other issues have people had with this kind of arrangement? The thing that scares me is that if they have even a small number of regulars, I'd hate to barge in, change things around, add and subtract from the menu, etc.
I'm sure they're not terribly focused on coffee quality, and since that's my main focus, that's the first thing that would have to change, along with removing several items from the menu to better focus on the coffee. Also, I'd probably want to change the name.
Thoughts? Am I likely to anger customers and/or employees, even if I'm creating a better quality product and a more focused cafe? Would this be temporary? Is there a good way to do this gradually?
Assuming that the financials, traffic counts, etc are good, what other issues have people had with this kind of arrangement? The thing that scares me is that if they have even a small number of regulars, I'd hate to barge in, change things around, add and subtract from the menu, etc.
I'm sure they're not terribly focused on coffee quality, and since that's my main focus, that's the first thing that would have to change, along with removing several items from the menu to better focus on the coffee. Also, I'd probably want to change the name.
Thoughts? Am I likely to anger customers and/or employees, even if I'm creating a better quality product and a more focused cafe? Would this be temporary? Is there a good way to do this gradually?
Replies to This Discussion
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Permalink Reply by Mike McGinness on
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It's human nature to resist change so yes, some customers will be miffed with any change. If changing the business name, look and focus I'd make menu changes at the same time all at once. Make it yours with your vision. Send a brief concise "news" write up to your newspapers in advance talking about the changes, especially quality focus changes being made. Making constant little changes can be more annoying to customers than total reinvention.
If employees can't make and embrace the changes, replace them. Don't let them dictate your business. Listen to their input and feedback to be sure, value them, but it's your way or hit the highway.
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Permalink Reply by Heather Holly Haller on
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Drive thru coffee kiosk for sale!
$25,000 includes:
building 8x10 with 2 drive-up windows one on each side
Ranchillo 2 group espresso machine (just serviced, with new gaskets and parts just like brand new)
ranchillo espresso grinder
larenzatto espresso grinder for decaf espresso
48'' sliver king glass door under counter refrigerator
small under counter milk refrigerator
grind master grind and brew commercial coffee system dual hopper
approximately 14 5gal fresh water jugs
2-3 waste water containers
30 gal waste water holding tank
60 gal waste water transport tank
counter top ice machine
various small wares and shelving
4 ornamental trees
roof heat/a/c unit
neon open sign
neon “good coffee” sign
''badger brew'' logos and signage not included
or I will sell just the building and water-system for $10,000
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Permalink Reply by Jason Shipley on
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Sean, you have to asses what needs to be changed. Just because they have been operating for 10 years doesn't necessarily mean things don't need to change or could not use improvement. You have to determine if you want to continue operating the existing business or if you want to treat it as a failed business and re-skin and reopen the place as your concept. I would not do this gradually but would close the place and reopen with your changes in place.
Conscious Cup just helped open Cook St Coffee in Barrington you should go check it out I'll bet you can't even recognize what it used to be.
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Permalink Reply by Jay Caragay on
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No offense, but are you sure that you're ready to "do your own thing"?
What I mean by this is: how well have you thought out your vision of a coffee shop? Do you really know what you want and want to deliver to customers? Or is it some vague notion of "I want to serve quality"?
Remember, you're probably going to put in most (if not all) of your money and time into the business - is this really what you want to do? Owning your own business becomes your life - are you ready for that? There's no more "calling in sick" or "going home" at the end of the day - in fact, the day really never ends. It's all-consuming.
I'm concerned about your comment: "assuming that the financials, traffic counts, etc are good..." Assuming? Financials? Do you even understand financial statements? You haven't bought the business and you're main concern here is whether or not customers are going to get upset about you barging in and changing things around?
What you're saying here is that you want to buy a business with:
- assumed financials, traffic counts etc.
- a not so focused coffee quality
- a large menu that you plan to reduce
- a name that you want to change
- employees that you will replace because of quality/change issues
My question is: what exactly are you buying here? Is the current coffee business viable? Are they making a profit? Have you analyzed the profitability of the company and where it comes from? Seems to me that there are lots of things you need to understand and consider about this company (and your own vision of coffee) before you should buy the company and worry about things like angry customers because you eliminated their 20z chocolate hazelnut frappe drink.
From my viewpoint, if you're buying an average indie coffeeshop and you want to make it into your vision of Intelligentsia Venice Beach, then you're in for a lot of pain and trouble with both staff and customers.
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Permalink Reply by Sean on
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Jay, no offense taken. My intent in the posting was to get a feel for the general idea of taking over and changing an existing business. I've made other posts and had many conversations with people in the industry concerning all the other minutiae of the coffee industry, and this current post was only intended to focus on one tiny part of that. I've been researching the coffee industry and owning my own business for many years now, and while research can't come close to actually doing and I certainly still have TONS to learn, I understand the commitment required.
I am just at the beginning of looking at this particular business and I have no intention of buying it without doing LOTS more research. I do have a very definite concept in mind and my decision would depend in large part on whether I feel that I can successfully, and profitably, implement that concept at this location.
Thanks for your thoughts Jay, and everybody else who responded. I really do appreciate the time you all took to respond!
Sean
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Great. Just want to make sure you jump in with your eyes open.
That said, depending on how radically different your vision of coffee is from the current shop, you will most certainly lose a percentage of customers - unless you're plan is to keep things the same.
When we took over the library space to open The Spro, we faced a crowd of regulars who had been used to the methods, techniques and menu of the previous tenant. Suffice it to say that our approach was radically different than the previous tenant and I believe we lost a lot of their "regulars" because of it.
What we did was nothing similar to the old tenants, save for the fact that we occupied the same space (and eventually more). We brought in new fixtures, cabinets, equipment and people. I reached out to the employees of the previous tenant (who didn't tell them they were closing and were leaving them out to dry) but were not able to retain any of them due to some getting other jobs outside of coffee and others not being able or willing to conform to our way of doing things.
Everything we did was radically different. Coffees brewed by hand in a french press. Espresso made with skill and care. Pastries and food items not made by some catering service or brought in frozen but sourced from gourmet markets or baked fresh by us. We brought radically high-quality to a place that didn't expect it, barely knew what it was but, eventually, recognized it. And while I never did a formal study, I'm sure that we lost many of their old regulars in the process but our numbers beat theirs today.
If you're going to make changes, do them all at once. But don't sign the contract and change tomorrow. Take your time. Get to know the store, the employees and the customers. I'd think about running the status quo for a couple of months (presuming the numbers are solid) to get a feel for things while planning your changes. Talk openly about the changes to the staff and your customers. Let them know what you're planning and why it will be better. Maybe implement some changes as you go along, i.e. proper brewing standards, improving the quality of beverages and espresso.
One thing to consider is that customers have a sense of ownership in a place they like. Respect that. Give them a voice. Let them voice their concerns. Listen. Train the old staff to your standards. Note who won't make the grade, see if you can work with them. If not, cut them loose. Bring on new staff to train to your standards. Best of luck.
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Permalink Reply by Jarred Hoffpauir on
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Sean, Have you thought about a property that WAS a coffee house? What I mean is a business that has gone out of business for some reason. The buildout has been done already and it probably has most of the big items that you would need to run your business. It probably will not have many of the things you want to change.
To find such a location you should contact some leasing agencies and commercial property brokers. The price of those locations will be VERY minimal and if they have not been closed for very long you will likely retain some of the old customers.
Most businesses close due to the fault of the owners and employees. Take advantage of that if you think you can do better.
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Permalink Reply by Casey Blanche on
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I know of a couple of businesses for sale. I can also set up a roastery for you if you want to get into that business too. Let's talk- caseyb2050 (at) maildotcom
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