There are many things to consider when purchasing an existing business so dedicate a large amount of your time to all the essential aspects and pitfalls that owning a café can bring.
A good way to do this is to go to the business in question and sample all that they have to offer. Sit down, try the food and drink available, observe the customers and how they are treated and react to the surroundings.
Then ask yourself the following: How are the owners coping and, if you are planning to alter anything, how could you improve things? Are there enough customers coming through the door? Are they the right customers for the area? And, possibly the most important question of all, is this the right location for you and your café?
The most crucial people are your potential customers, so ask them what they think and what they want from a café in their area. Steve Nottage, owner of Coffee Potshop, says this simple and inexpensive method reveals many secrets to potential success.
“We did a lot of research in the local area and asked passers by and local people what they wanted and needed from a café in that location and it proved very fruitful. Then we went to the council and asked if there were any plans to build on and around that site and finally to the bank to propose our plan and borrow a small sum of money.”
The research doesn’t end here: you must investigate your future competitors.
Your range of competition is threefold. It will come from direct competitors such as other smaller, independently owned cafés that either serve food and/or alcohol; larger chain cafés; and also other established food/drink outlets in the surrounding area such as pubs, restaurants and bars.
You will have to think long and hard about the competition around you and whether it could affect your trade. So take some time out to walk around the area at different times of the day. Seeing things from a customer’s point of view gives you a good perspective of what it’s like to select which café to visit. In addition, use the internet to see what the competition is offering and scan the Yellow Pages and web listings for your local area thoroughly.
If your café, as you buy it, is not in the style or trend you are looking for but the location is suitable and you are set upon buying it, then change it to your customers’ and your personal taste. You may, if the café has neglected this area, choose to plan a stronger advertising strategy to reach out to a larger audience. This can prove vital for such an image-based industry and can involve numerous techniques on an ongoing basis.
This can include anything from placing leaflets or sample menus and flyers in local offices, information centres, shops, pubs, libraries and handing them out in the street to placing an advert in the local paper, the Yellow Pages or Thompson’s when you first buy the café.
Anything free is a bonus, so consider local press and free publications that are targeted to local households. Get included in a ‘Good Food’ guide, spend some cash on an opening night that will attract press coverage and reviews, or maybe organise theme days or promote cafe soirees with drink promotions. You could also hire out the premises for birthdays and private parties.
Rules and regulations
To run an establishment that involves food, catering for the general public, certain standards in your café will have to be met. Your local council will be able to point you in the direction of an environmental health officer (EHO). The EHO will, at the early stage of your business, ensure that the operation conforms to statutory regulations, thereby avoiding costly refits. They will also investigate accidents at work involving staff and the general public, health and safety complaints and provide information to businesses and members of the public to increase general awareness of health and safety.
In addition, there are certain regulations you must abide by. These include food premises (in order to register your café with your local authority), food safety, hygiene and temperature, financial laws such as requirements on food VAT charges – as well as a licence if you wish to serve alcohol. You will also be restricted to alcohol being served only with a substantial meal.
Typically when buying an existing café, you will not need to concern yourself with regulations such as the number of fire exits and seating/size requirements as you may already be covered. But remember – it is essential that you check with your local authority that you are abiding by the rules as the previous owners may have neglected to do so.