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Permalink Reply by Andrea Otte on March 2, 2009 at 11:36am

It has been especially hard times in the midwest the past few months, but by walking into New Wave Coffee in Logan Square, you would never know it. Here in Chicago, the past two months have been almost surreal for myself and the owners of New Wave, who opened the shop with the hope, slight as it may have been, that they could start turning a profit in six months. Instead, we have had to hire several new employees and more than triple our orders with Tony at Metropolis. Our luck, if you can call it that, has to do with a few factors. I think the biggest factor has to be the changing social climate in the neighborhood right now, leading to a very open market. Recently Logan Square, traditionally a poor, mostly Puerto Rican neighborhood, has seen an influx of young, mostly white students and families. And while the area is under scrutiny from both sides for being the axis of intense gentrification, the results for myself and my job have been positive. Until New Wave opened its doors, the only place to get coffee was at the taqueria down the street, or dunkin donuts, or like me, you could make the hike across two neighborhoods to the Broadway Intelligentsia. Other things that might be important factors include the sad fact that a lot of our regulars these days are people using our space and our free wifi to look for employment. Thankfully, they still buy coffee, though if the economy continues to fall this may change. I'd like to think that it also has to do with the quality of our coffee, as I certainly have tried to acheive that. As you mentioned, Matt, the lease was easy to come by because the place was, well, a dump. It took over a year to rebuild before we could even think about opening. But now the rent is hella cheap, and will stay that way for a while. Thanks for bringing up this thread, and I hope there are more stories like mine out there.

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Permalink Reply by Denise Smith on March 2, 2009 at 7:33pm

The Celtic Cup Coffee House will have a ribbon cutting on March 11 @ 2PM. We will have a Special Event, Open House on March 17th with a live band 6-9PM to celebrate St Patrick's day. Then we will have a soft open time with our Grand Opening March 27 & 28 and Wm Alan Ross will perform from 6:30- 8:30PM.
We moved to this town ten years ago and the first thing we did was look for a Coffee House... or anywhere to get a half way decent cup of coffee... we could find one so five years ago we started looking for a location so we could make it happen. In Oct 2006 we attended American Barista and Coffee School and in February 2007 we purchased a corner lot with the intent of building from the ground up. This past September we purchased the property next to ours and have been working diligently to renovate it. Now we are only weeks away form making it all come true... a dream ten years in the making... a great cup of coffee in Coffee County Tennessee... in a community gathering place... The Celtic Cup Coffee House!

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Permalink Reply by Ruth Baliotti on March 14, 2009 at 3:43pm

I love to hear success stories like yours Andrea, and it seems location is the key to any business - tough times or not. I am a consultant in the textiles industry, which as you may have heard is pretty much done off shore these days. We took a stand at a busy farmers market a year ago, and do fairly well with the textiles-however have noticed that all people are really doing these days is grabbing a cup of joe, and a snack as they socially cruise the aisles! So, the coffee bar owner recently left the business, leaving the opportunity to my husband and partner.

It would be great to get a few words of advice on what things to bring in first. We have networked with a restaurant coffee service provider, tasted the coffee and will get their support- from there we would like to bring the accessories, roasted coffee by the bag, teas, some gifts, and baked goods.

Do you think it pays to roast your own beans?

Any advice is welcome!

Best

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Permalink Reply by Jason Shipley on March 22, 2009 at 7:14pm

We helped open a shop just before thanksgiving that is doing really well, again a great location and a focus on quality. The shop we did in January is struggling a bit but will do really well in the next couple of years, they are getting a light at their intersection and a minor league baseball stadium across the street. I think they will do really well.

We are working with a building owner that is converting a Caribou location that closed into their own cafe, with the hopes of selling it down the line. Again they have a great location and it will be interesting because they are only three doors down from a Starbucks. This will be a fun project.

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Permalink Reply by Christine on April 2, 2009 at 4:38pm

Matt,

I am interested in opening my own coffee business, however, I would like to purchase an existing business. I have visited Portland a few times and could see a business of my own happening out there. One idea I had was to contact owners of bars (since many of them don't open until late afternoon) and see about running the bar as a coffee bar during the morning and afternoon. But, I would definitely even look into purchasing a coffee business for sale and taking over from there. I am doing research at the moment to make a successful purchase, but my focus right now is finding the right seller and getting a business loan.

Do you have any advice that could be helpful in getting a loan/grant or even seller financing?

-Christine

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Permalink Reply by Jon Mitchell on April 3, 2009 at 6:07am

Matt -

These kind of things are always both encouraging and a "call to caution" at the same time. I agree with what you've said that now is a time of opportunity for negotiations that can really benefit the business owner. I'm in the process of opening a coffee bar. I'm currently about to wrap up the business planning and projection phase, and I'm about to move on to meeting with lenders and really trying to sell my vision. I've got a location picked out and once I get the money secured it's full steam ahead from my perspective. The advice you gave at the end of your post here where you said, "one must do everything right the first time," is a little daunting for me being that I have very little to no experience in this field but I think what you meant was; that we have to be very calculated about opening a business in this climate. One has to do their homework, really think about all the factors and try to figure in the unforeseen surprises that may arise. So many times, people have what they feel is a good idea and then with reckless abandon jump all the way into something only to be out of business within 6 months to a year because they didn't plan well or really think out their strategy.

I'm encouraged by the conversations I see here in bX about how business is either holding steady or on the rise. I think that if someone that is opening a business in this economy can make the right deals, set themselves up wisely, and manage to attract a loyal following, then when the economy finally does turn around for the positive that they'll find themselves in a really really great place financially.

I have to admit, in Arkansas or at least in my town, we haven't really felt the economic crunch that we all seem to hear about on the news. I think if there's anything being felt or seen by businesses it's a result of the fear that the media seems to perpetuate. When my wife and I go out we see lots of people out eating, going places, and doing things. People in our area don't really seem to be "doing less" really. Most times when I go into a business and ask them how business is, they typically without fail will tell me that their business is up from this time last year or from the previous month.

So I agree with you that we have to proceed wisely and be calculated and I also think that this is a time of possible great opportunities. There is always someone making money in every economic environment. Even in "downtimes" someone is making money. You just have to see the opportunities that the climate presents and determine to capitalize on them.

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Permalink Reply by Jon Mitchell on April 3, 2009 at 6:13am

Andrea - Should I take this statement to mean that the shop did start turning a profit within 6 months or not? Very interesting and glad to hear things are going so well.

Andrea Otte said:

It has been especially hard times in the midwest the past few months, but by walking into New Wave Coffee in Logan Square, you would never know it. Here in Chicago, the past two months have been almost surreal for myself and the owners of New Wave, who opened the shop with the hope, slight as it may have been, that they could start turning a profit in six months. Instead, we have had to hire several new employees and more than triple our orders with Tony at Metropolis.

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Permalink Reply by Denise Smith on July 13, 2009 at 2:23pm

We are still alive and growing! Nearly four months now!
Some days are slower then others but we are making it and doing well. Everyone who comes in compliments us on decor, landscaping (the newest addition), the Coffee, and the wonderful food.
Now if I don't die of exhaustion before I can train a night manager we'll really be making it!

Denise Smith said:

The Celtic Cup Coffee House will have a ribbon cutting on March 11 @ 2PM. We will have a Special Event, Open House on March 17th with a live band 6-9PM to celebrate St Patrick's day. Then we will have a soft open time with our Grand Opening March 27 & 28 and Wm Alan Ross will perform from 6:30- 8:30PM.
We moved to this town ten years ago and the first thing we did was look for a Coffee House... or anywhere to get a half way decent cup of coffee... we could find one so five years ago we started looking for a location so we could make it happen. In Oct 2006 we attended American Barista and Coffee School and in February 2007 we purchased a corner lot with the intent of building from the ground up. This past September we purchased the property next to ours and have been working diligently to renovate it. Now we are only weeks away form making it all come true... a dream ten years in the making... a great cup of coffee in Coffee County Tennessee... in a community gathering place... The Celtic Cup Coffee House!

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Permalink Reply by Barbara Adams on July 15, 2009 at 5:36am

Wonderful thread Matt. You know me, I have been lurking around with my tiny budget for a coffee house for about a year and half. We finally broke through. Signed up with a business broker and found a coffee shop/bakery for sale in a very nice shopping center with great clientele base. All of the equipment we need is already there and it is only 2 years old. The previous owner did all of the leasehold improvements and trained all employees. So, with our limited budget, we are able to buy a profitable business, with great lease and employees and a customer base. There are deals out there now. Just got to be cautious on why people are selling. This particular person has to move to another country because of her husbands transfer.
We are closing September 1st, just a few months before season here in Florida.

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Permalink Reply by Barbara Adams on July 15, 2009 at 7:35am

Thank you Jack! I already forgot all my training!

Jack Groot said:

Congrats Barbara!!

Barbara Adams said:

Wonderful thread Matt. You know me, I have been lurking around with my tiny budget for a coffee house for about a year and half. We finally broke through. Signed up with a business broker and found a coffee shop/bakery for sale in a very nice shopping center with great clientele base. All of the equipment we need is already there and it is only 2 years old. The previous owner did all of the leasehold improvements and trained all employees. So, with our limited budget, we are able to buy a profitable business, with great lease and employees and a customer base. There are deals out there now. Just got to be cautious on why people are selling. This particular person has to move to another country because of her husbands transfer.
We are closing September 1st, just a few months before season here in Florida.

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Permalink Reply by John P on July 15, 2009 at 6:47pm

I think that any new shop owner needs to prepare as if they will have a "worst case", but viable business, scenario for their first couple of years. Usually it means more capital than you expect and focus on quality and efficiency. Nothing will kill you more than loss in product and labor overruns.
And of course inconsistent quality is a death nail.

Understand business, understand how tough it is, and make decisions with your head. Don't rush, make sure you know what the hell you're doing before you mortgage your future. There are a few places that have a distinct advantage because of population density, but with those, lease rates tend to be higher and any failure is often more dramatic. Understanding your particular market is key. And if you're daring enough, you can create your own market. For most, it takes a lot of skill, desire, blood, and a fair amount of money to succeed. And if you open successfully in this market, everything else will be easy.

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Permalink Reply by Dave Miller on July 15, 2009 at 10:47pm

A couple months ago I spearheaded the opening of a new shop (Ipsento) for our company in Chicago's Bucktown neighborhood. We were originally purely a direct trade coffee roasting company but I felt a need for us to establish a retail presence that educated the community about coffee and trade while also beginning a movement behind direct trade. We acquired a cafethat had recently shut it's doors and relaunched it with a completely Different feel. We installed a roaster, began selling only organic pastries, practiced recyjcling, designed a more comfortable atmoshere, used green friendly products, offered unique sandwiches made with high quality ingredients, began a small marketing campaign to tell the community about us, joined various neighborhood groups, offered coffee roasting classes, and put every Barista through rigorous training. Quality was and is the key to everything we do. Every day people tell us that our coffee is the best they have ever had. This is evident because our numbers are now double and sometimes triple what the shop used to pull in. This has allowed us to begin an expansion project that will offer more seating and larger coffee
roasting space. Don't misunderstand me, we aren't getting rich, but we are surviving
Through a rough time while offering great coffee and a unique coffee
Environment. It has taken countless sleepless nights and dedication but all of this along with a decent location has truly paid off. If you need any advice don't hesitate to ask.

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