Location is imperative in the specialty coffee business. More often than not, people don’t like to travel very far to get their coffee fix. This means that if you’re trying to find the best location for your coffee business, you’ve got a lot of things to consider. Finding that sweet spot of a great location is by no means easy, but with the right amount of research, effort, and patience, you’ll get there! This guide is meant to help give you a starting point.
Look For High Visibility
People who are needing coffee in that moment will most likely go for the most convenient place they can find. This means they probably won’t go out of their way to get their coffee from you, so you need to be as visible as possible to customers passing by on a daily basis.
Specialty coffee businesses are known as convenience businesses compared to destination businesses like a bank. Your customers come to your business because they choose to and it’s convenient for them to do so. So find a location that is easily accessible and located on people’s natural routes: on their way to work, steps from bustling office buildings, or in areas where they shop to name a few. Try to think of where YOU go to get your coffee, and why you go there – you’ll likely come up with a few ideas for criteria you need to be sure you meet for when you open your own cafe.
Don’t get too excited and jump on the first one you find! One of the hardest things to remember is that finding the best location is worth the wait. We get that starting up a coffee shop is exciting; you’ve been dreaming about it for so long, you might even have designs for your perfect store already. You want to get your doors open as soon as possible, but that doesn’t mean you should compromise.
Location shopping can be very frustrating sometimes, we get it, but don’t compromise your values and expectations because you’re just not finding what you’re looking for; you’ll regret your impatience later on. It might even lead to disaster. The right location will come and it’ll all be well worth the wait. It’s better to be patient and get the perfect location, than impatient and risk the future success of your business because you didn’t want to wait.
Call Up a Pro
We highly recommend that you call up a professional to help you location shop. The reason we speak so highly of this is that consultants in the industry are experts and know what to look for in each location. There’s a tendency to go into location searching thinking that it’ll be easy to see which location are great and which are absolutely terrible, but this isn’t always the case.
Factors that add up to a great location aren’t always obvious to the naked eye or a newcomer to the coffee business. These newcomers can’t always see what the pro sees and how those small aspects will influence your business’s success. For example, we recently looked at a location the potential shop owner was very excited about. It was located on a major road through town, had a lot of space, and it would be beneath an apartment complex. Sounds like a no brainer, right? There were two big problems with the space. The first problem was an existing coffee shop just down the street that locals already liked. It may have been possible to steal customers away, but it would not have been easy. The second, bigger problem was a complete lack of parking or drive through. Car traffic doesn’t mean much when there’s no way to stop. Trust the professionals who have experience in the retail business and get their opinions on your location options.
Real Estate Brokers
Commercial real estate brokers can fall under the same umbrella as working with pros, but they deserve a special callout. When working with a broker, it’s a good idea to bring them a visual of what you’re looking for and tell them what your idea location would be so they have a good idea of which properties to steer you towards.
These brokers can have information that you may never be privy to like a storefront that’s about to become available before a “For Lease” sign even pops up in the window. They also have incredible connections with property managers and may know what they’re looking to put in their vacant spaces. You may be reluctant to spend extra on a broker, but they are extremely useful in finding the best location for your shop.
Some tips about real-estate brokers:
- Find someone who is invested and understands your business concept.
- Keep in touch with them frequently to make sure they’re still pursuing your concept.
- Consider asking for the broker’s help presenting your concept to the landlord and navigating the leasing specifics.
- Make sure the broker you choose is working for you and not for a landlord. This can become tricky seeing that the landlord’s interests may be put before yours and they are usually paid a percentage of your monthly rent.
Two Types of Locations to Look For
There are essentially two types of locations we recommend you look for: High-Volume Migratory Clientele Locations and Captive Audience Locations.
High-Volume Migratory Clientele Locations
These types of locations include places such as airports, malls/shopping centers, sports arenas/performing arts centers, amusement parks, and major tourist attractions. All of these locations are important because large masses of people pass through on a daily basis. These are most likely not going to be the same people over and over again, but this is no matter if there are enough bodies flowing through for you to make a profit.
These high volume locations do tend to charge a higher rent which poses a challenge: you need to sell a lot coffee to cover your overheads each month. Another thing to consider is the fact that repeat customers in these locations are pretty unlikely meaning your marketing techniques will need to be very different. You need to find inventive and appealing ways to draw in customers, not expecting them to return again or become repeat customers. Visibility and appearance are huge here; your customers need to be able to see you and then want to buy something from you immediately.
The types of locations that fall into this category are office buildings, business parks, hospitals/medical centers, college campuses, downtown sites, military bases, and large neighborhoods. We’ve found that of these locations, colleges, hospitals, and office buildings have the highest number of coffee drinkers.
A warning about college-based operations is that the sales will probably be incredible during the school year, but during the summertime your business could drop off by 50%… that’s a huge hit. Hospitals and office buildings, on the other hand, will provide you with steady business year-round.
This type of location is appealing to many people seeing that you’ll be able to gain a base of returning customers. Not only will they be returning daily, but they may come back several times a day within their eight hour shift. With your quality of coffee and customer service, you can build on this captive audience who will tell their friends about you and voilà! Instant marketing.
Want to open a coffee shop?
Our Business Workshop is jam-packed with information for the prospective coffee business owner. We can offer expert advice no matter if you’re opening your first shop or looking to expand. Learn about location scouting, marketing, management, and much more.