If you want to expand your coffee services to a broader market, you’re going to have to take advantage of the ubiquitous take-out and delivery segment that is dominating the food industry for five years and counting. Setting up delivery for your coffee shop is a good way to add a revenue source, but can come at a hefty price. Most small business owners have to choose between shelling out a lot of money upfront on a gamble, or missing out on the fastest growing market of the food industry: delivery.
Here are the six steps to set up delivery for your coffee shop:
- Research your demographics
- Restructure your kitchen
- Merge revenue streams
- Look into delivery options
- Buy disposable containers
- Build customer trust
Following these steps will ensure you set yourself up for success while dealing with the inevitable growing pains of an expanding small business.
Research your demographics
Doing your research not will only tell you if delivery is a valuable service for your coffee shop, but it can also set you up for success early on by allowing you to create a delivery service that’s efficient for your wallet and caters uniquely to your customers.
First, take a look at the people that walk through your door. If you work near an office building or in a city, you might find a good market for people who want to grab some food and quickly head back to the office instead of waiting in long lines. If you live near a school or hospital, take-out and delivery might be helpful to the students and health professionals in your area. Analyze what the needs of your current consumers are, and see if there’s an untapped market anywhere there.
Next, pore over your point-of-sale figures. If your coffee shop is using a point-of-sale system, it can show you how much foot traffic you’re getting at certain hours of the day, and what people are buying. This will show you what times are the most crowded If you notice a lot of food and coffee purchases around the lunchtime rush, there’s a good indication that a portion of your customer base would find a take-out or delivery service to be extremely valuable.
Also notice if any of the other food and dining establishments in your area are also doing take-out or delivery. While this information alone shouldn’t be your decision-maker, it can be a helpful litmus test when you are trying to stay competitive and understanding what your customers’ needs are.
Restructure your kitchen
Once you have decided there is a demand for a delivery service, you need to make sure you can supply it. This might mean dedicating a part of your kitchen solely for take-out and delivery food prep to keep things organized. That way, your employees still have a good flow between the front of the house and the back of the house for those walk-in customers.
You may also need to hire a couple of extra employees to assist with cooking, packaging and sending out the food. Think of your delivery service as basically being a second storefront –– just digitally. If you opened a second store, you would have to hire more employees to operate that store.
We would recommend adding a couple toaster ovens to your existing collection for warming up pastries.
You will also have to dedicate a space at the front of the house for delivery, so your customers aren’t standing in a line with the delivery persons, and the delivery persons aren’t listening to people decide what food they want while they’re waiting on a piping hot order.
Remember, you don’t want your delivery service to get in the way of your storefront –– you are simply expanding your services, not changing existing ones. It’s important for your kitchen and coffee bar to work on separate things at once so both sides of the operation run smoothly.
Merge revenue streams
It can be easy to consider your delivery service as a different operation from your storefront. In fact, up until 2016, most point-of-sale systems did not have a way to track delivery from third party apps and even the most “updated” ones tracked delivery orders poorly.
But point-of-sale technology has since had a major upgrade, it’s important to consider your delivery as a part of your already-existing business, especially if you want to grow.
Data is invaluable, and learning what times customers are ordering online, learning how much revenue you pick up from those sales, and learning what they’re ordering will help you fine-tune your delivery experience.
You might find some items simply aren’t selling, and you can cut those dishes from your budget the next time you restock. You might find you need more staff during certain hours –– not because the store is full, but because delivery orders pour in.
Updating your point-of-sale system and preparing to organize revenue streams will help your coffee shop run more smoothly and efficiently.
Looking for more information about point of sale systems? Check out this article!
Look into delivery options
This is where a small business owner would be spending most of their money on. There are three ways you can get your food delivered to customers:
- Third party apps
- Contracted delivery employees
- Hourly workers
Third party apps are arguably the easiest route to take. Not only do they have their own internal system by which customers can order their food from you, working with third party apps is almost like taking out a billboard and advertising your services to potential customers scrolling through their delivery options. Furthermore, customers already have their delivery and payment info already entered into the app, making it easier to push them through the sales funnel.
However, most delivery apps take a hefty commission for the service they provide. It can be a hard pill to swallow, considering they are middlemen. But in times where delivery is getting more and more popular each passing year, it is easily the most convenient option for both customers and the food industry.
If you choose not to work with third party apps or external delivery companies, you can either hire hourly employees or contracted employees. It’s important to look carefully into the labor laws of your state and county, and manage your expectations accordingly. If you want your delivery employees to wear a uniform, you will have a hard time explaining to your local labor board that they are contracted.
You will also need to make sure your service staff are compensated and tipped according to the etiquette standards of your area. A better relationship between delivery staff and your coffee shop can ensure they will take great care in representing your company while on delivery runs.
Buy disposable containers
We try not to judge a book by their cover, but more and more people are getting delivery take-out because they want the restaurant quality and experience in the comfort of their homes. As such, you want to get takeout containers that represent your establishment wisely.
That’s not to say you have to buy expensive, technically-reusable-but-not-advised food prep containers that are so popular nowadays. But if your coffee shop prides itself on brewing shade-grown sustainable coffee, rethink styrofoam containers –– that doesn’t align with the brand customers know you for.
And while delivery is incredibly popular, more and more customers are looking to lessen their carbon footprint. Consider investing in recyclable containers and wraps –– they’re much more sturdy and provide a better eating experience for your customer, which makes your coffee shop look good.
Good-quality containers also make up for any mishaps that happen during the delivery process. If something tips over in a quart container as the delivery car swerves into a merging lane, it can both save both your delivery driver and your customer from any inconvenience or messiness. If your food shows up in a leaking bad that leaves residue on your customer’s counter, it can make your coffee shop look sloppy.
If the budget permits it, consider customizing your packaging. This can be as elaborate as printing your logo on the front of every paper bag that leaves your store, but it can be as cheap and easy as buying a stamp of your logo and stamping every bag before it leaves the store, or buying customized logo stickers to place on top of your containers.
Build customer trust
Imagine a new customer ordering food online, paying, and staring in anticipation as the tiny car icon makes its way from your coffee shop to their door, only to find their food unsatisfactory. It’s a quick way to lose a customer.
It’s especially difficult because, unlike walk-in customers, a delivery customer can’t walk up to a barista, request a change, and immediately see the customer service. They may or may not offer up a couple stars or vague feedback.
Some restaurants leave business cards in the delivery bags asking for feedback to show how important customer service is to them. Others respond to customers who have put up a complaint on delivery apps. Whichever way you go, being responsive to feedback not only gives your coffee shop a second chance to customers, it also provides that in-person reassurance experience online.
Frequently Asked Questions
Consider creating a delivery-exclusive menu that consists of items that travel well. Anything that gets too messy, too delicate, too soggy or too cold in transit will make for an unenjoyable customer experience and can put too much pressure on your budget. You can also put items on the menu that are not available to walk-in customers, which has historically boosted delivery orders from existing customer bases, according to many restaurants.
Besides the obvious benefits like expanding your revenue source, establishing a delivery service can also improve the customer experience for people who won’t opt into it. You and your employees can better serve the walk-in customers when there’s less morning congestion or lunch rush. They won’t have to wait absurd hours to get what they ordered, and your staff can serve their needs with a little more care.
With hundreds of options at their fingertips, customers rely on ease, accessibility and trust. You might consider hiring a developer to create an easy-to-use app and have an online-only points system so your customers are encouraged to use it.
You could advertise using a pamphlet and a QR code that customers can keep safe. Most importantly, if you choose to forgo an app, you have to be on top of word-of-mouth and marketing services. Talk to your regular customers, offer them a pamphlet the next time they order coffee in-store, and lean on your already solid foundation of trust and craftsmanship you have built with existing customers.
Please note: This blog post is for educational purposes only and does not constitute legal advice. Please consult a legal expert to address your specific needs.
Hi! I’m Shawn Chun
My adventure in coffee began when I first launched my first coffee shop back in the early 2000s. I had to figure out so many things on my own and to make it worse within 2 years of opening two large corporate coffee chains moved in just blocks away from me!
As I saw smaller and even some larger coffee shops in the neighborhood slowly lose customers to these giant coffee chains and slowly close up shop, I knew that I had to start getting creative…or go out of business.
I (like you may be) knew the coffee industry well. I could make the best latte art around and the foam on my caps was the fluffiest you have ever seen. I even had the best state-of-the-art 2 group digital Nuova Simonelli machine money could buy. But I knew that these things alone would not be enough to lure customers away from the name brand established coffee shops.
Eventually, through lots of trial and error as well as perseverance and creativity I did find a way to not only survive but also thrive in the coffee/espresso industry even while those corporate coffee chains stayed put. During those years I learned to adapt and always faced new challenges. It was not always easy, however, in the end, I was the sole survivor independent coffee shop within a 10-mile radius of my location. Just two corporate coffee chains and I were left after that year. All told the corporate coffee chains took down over 15 small independent coffee shops and kiosks and I was the last one standing and thriving.
Along the years I meet others with the same passion for coffee and I quickly learned that it is not only “how good a barista is” that makes a coffee shop successful, but the business side of coffee as well.
Hence why I started this website you are on now. To provide the tools and resources for up and coming coffee shop owners to gain that vital insight and knowledge on how to start a coffee shop successfully.
Stick around, browse through my helpful blog and resources and enjoy your stay! With lots of LATTE LOVE!