
My coffeehouse nightmare - ca98am79
http://www.slate.com/id/2132576/
======
showerst
Although the author barely touched on it, I used to have a friend who owned a
coffee shop and told that there's always an interesting push-pull. People like
a coffee shop for two reasons: Great atmosphere (most important), and great
coffee.

Great atmosphere encourages people to linger on that $5 ticket for hours,
which is a black hole for money, but if your atmosphere sucks you'll never get
the buzz and reputation to keep the long lines of to-go in the mornings that
you need to survive.

Great coffee is hard to find, and requires competent baristas, which are a
hard to find/train outside of big cities.

I'm a huge coffee shop nut, but from a business perspective it seems crazy. As
an interesting aside, another slate article noted once that indie coffee shops
that have a starbucks open nearby actually do _better_ afterwards on average.

~~~
thaumaturgy
> _Great atmosphere encourages people to linger on that $5 ticket for hours,
> which is a black hole for money..._

This is a problem that restaurants and other places solved a long time ago. I
don't get why coffee shops never seem to do this: train your staff to make the
rounds when they're not busy. Stop by any table with an empty cup, pick it up
quietly, smile, gently ask the customer if they'd like anything else. (Don't
nag or harangue the customer or ask the same one more than once an hour.)

Coffee shops have a problem with customers coming in and making themselves at
home because they aren't being run like a business: there's very little staff-
customer interaction. People come in, order (maybe), find a corner, and park
there on the wifi for two hours. Shops respond to this by making customers
come up to the counter to get a wep key, but that's the wrong way to do it.
Instead, invite people in, invite them to stay, and ask them once in a while
if you can bring them anything.

And as an added bonus, your staff will make a little extra in tips, too.

~~~
nopassrecover
You make sense, but the attraction at staying in a coffee shop for me (and
often paying the inflated prices) is in treating it like a library. In any
business if a salesperson comes past more than once asking if I've found what
I want yet I'm pretty tempted to leave. That's probably the desired result
here but I'd pretty quickly find an alternate coffee shop that didn't bug me
at all.

~~~
thaumaturgy
Yeah, that's the least desirable of the outcomes, but it's still not a bad
deal for the business.

You have to figure that there will be some customers that want to be able to
come in and basically rent space (plus, usually, a restroom and wifi) from the
business for a couple of hours for the price of a cup of coffee. Although
there's nothing really wrong with a customer wanting that, it's not a good
deal for the business and they have no motivation to support it.

That's why the interaction from the wait staff should be really low-key. If
the customer really isn't OK with being offered something once an hour or so,
then that's just not a good customer for the shop. (My local co-working space
charges $20 per day for anyone looking for a place to work; I use that as a
yardstick for what's reasonable at a coffee shop. If I'm going to be there for
more than a couple of hours, then I'm treating it as a co-working space and I
owe them $20 of revenue.)

Most other people find it fair and convenient to get another cup of coffee or
other treat delivered to them, and regard it as good service.

I suppose that if the shop thinks there are a large enough number of people in
their area that are just looking for a place to work, _and_ are willing to pay
for it, but just don't want to be bothered at all, then they could offer
something like a "day pass" -- $10 for camping out for more than a couple of
hours without being interrupted by the staff, plus a discount on their coffee
or other products.

But I'm not sure that would have enough takers to be worth it.

~~~
tptacek
You say, _My local co-working space charges $20 per day for anyone looking for
a place to work; I use that as a yardstick for what's reasonable at a coffee
shop._ This logic is totally broken. Your co-working space has a different
cost structure than the coffee shop. In particular:

* Your co-working space doesn't need to factor in the cost of baristas and managers into the value of a table/hour.

* Your co-working space isn't set up in a super-expensive retail property, so the inherent value of a table/hour their is lower.

You've been underpaying your coffee shop.

~~~
thaumaturgy
There's a limit to how much of a business's problems the customer should have
to consider. I don't think very much about the co-working space's costs (are
they spending more on marketing? What about faster internet? Building
maintenance?), and I'm not thinking much about the coffee shop's costs.

I'm just starting with what a particular thing would cost me elsewhere, and
offering to pay that to someone else.

Also, I'm trying to avoid going into specifics because they won't help us
understand why coffee shops should work on their customer interaction, but I
can assure you that our local co-working space has much higher monthly
expenses than any of our coffee shops.

~~~
tptacek
I agree. I'm being facetious. It's not your problem that the coffee shop is
letting you sit there and cost them money; they should stop letting you!

------
al3x
Most coffee shops fail at their primary function: serving a quality cup of
coffee.

In years and years of being cafe-obsessed, I've never seen shop fail that went
the extra mile with their drinks, whether by roasting their own beans,
training their baristas to competitive levels, or simply buying good beans,
milk, and machines.

I read this article some time ago, and didn't see the obsession with coffee
shine through. Without that passion, a cafe will be replaced by the next hip
or quaint establishment that pops up to cater to idling customers.

~~~
davidmurphy
Intelligensia (<http://www.intelligentsiacoffee.com/>) seems to put all the
focus on the product.

~~~
zaphar
That focus shows too, I literally can't walk past them without stopping in for
a cup. The baristas know me by name. Even after a two week absence due to
traveling they still had my order brewing as I walked through the door and
ready immediately after I paid.

------
hugh3
Interesting article about a failed business, marred only slightly by the way
the author wants to write off his own bad business decisions as an inevitable
problem with the coffeehouse business model.

Of course it _must_ be possible to make a lot of money with a coffeehouse;
Starbucks frinstance does just great, and plenty of non-chain places must be
making a lot of money too.

Many of the problems he had just sound like he didn't have enough time to
optimize his business model... if he was throwing half his croissants away
then maybe he should have been buying fewer croissants? And do you _really_
need a guy in the kitchen getting paid to whip up the occasional crepe when
coffee is where you're gonna make the big bucks?

~~~
vl
He obviously tried to create not a standard a-la starbucks coffee shop, but a
more luxury experience. It seems he had to revert to non-cozy and fast or to
charge premium prices and try to become "fashionable" place.

~~~
frossie
The real issue seems to be that he tried to create a "family restaurant"
operation without the "family" (in this case him and his wife) wanting to work
in the business:

 _My wife Lily and I could work there, full-time, save on the payroll, and
gerrymander the rest of the budget to allow for lower sales. Guess what, dear
dreamers? The psychological gap between working in a cafe because it's fun and
romantic and doing the exact same thing because you have to is enormous_

In other words, he had the luxury of choice. And he chose not to.

~~~
jaxn
I wish I could upvote this more than once.

------
karzeem
As one of the maligned "people with laptops", I often wonder how much I'm
expected to spend. What's the expected $/hour you should drop if you spend all
day working in a cafe?

~~~
lionhearted
> As one of the maligned "people with laptops", I often wonder how much I'm
> expected to spend. What's the expected $/hour you should drop if you spend
> all day working in a cafe?

I think it depends on how busy it is. If the place is dead, they'd probably be
grateful for you to sit there and make it look more happening for someone who
comes in. But during busy time, clogging up table space for three hours on one
coffee is probably aggravating.

When I go to a non-chain, if I want to sit for longer than is normal, I just
ask them. "I was thinking of having a coffee and hanging out on my laptop for
a few hours - is that okay with you?" 90% of shops will say yes if they're not
busy, or tell you when the time that that they get busy is. 10% will give a
hesitant yes or non-answer, and I'll either only stay a short time or head out
from there. Like everything, it depends on the particular situation.

~~~
jrockway
Wow, actually working together and _talking_ to solve problems instead of
passive-aggressive "no laptops allowed" signs or "I hate my customer" blog
posts? What a concept...

~~~
drunkpotato
I like your thinking even better than mine. Although I don't think sarcasm
translates well to this format.

------
lars512
No doubt New York's a very different beast, but in Melbourne it seems cafes
are still bursting out everywhere (and have been for years). This is even more
amazing given how many still serve bad coffee. It seems to remain profitable
here, whereas the dream of running a restaurant is what seems to drive more
people to ruin.

A local celebrity chef started a new restaurant with another talented chef
partner. Six months later, the partner left to run a cafe, since the work and
stress involved in making paninis and light meals for people was far less than
a gourmet restaurant, and the payoff better.

~~~
com
Um, you need to get out of Melbourne. I am always amazed at how universally
excellent espresso is there: beautifully roasted, excellently barista'd and
absolutely no milk or sugar required while still being dark, thick and tasty.
Compare to Sydney or most of Europe (or much of North America).

Cafés in North America often run to chocolate muffins and energy bars, but the
whole Australian café provision of light warm meals is fairly alien there (see
the success of Pret in NYC as a business with a very different value
proposition to most other chains). I would imagine that the additional
profitability from this cultural difference might be one of the reasons of the
success of cafés where you are; that and the fact that the inner core of
Melbourne has 2m+ residents and is fairly walkable which leads to a different
kind of use of these kinds of spaces.

------
wyclif
This is an old dupe, but I think it's worth revisiting for the "cautionary
tale" aspect: this is the link I send to friends who mention wanting to "open
a little coffee shop somewhere."

------
tokenadult
2005.

~~~
algorias
So What? Does that make it obsolete? I guess indicating the year is important
for older tech articles, but definitely irrelevant in this case.

~~~
die_sekte
This particular articles pops up every couple of months. Sure, it's quite
interesting, but it's time-saving if you know that it's older and you don't
have to reread it.

------
brudgers
$18k a month in revenue with 15% takehome is only $2700 a month.

For a couple.

On the Lower East Side.

The problem was not people with laptops.

It was a business without a _pro forma._

------
ancornwell
"The most dangerous species of owner ... is the one who gets into the business
for love."

That is a powerful quote.

~~~
jkahn
I think that's the real message of the article. I don't think it's about the
coffee market in NY, or in general - it's about making sure you think and
measure before you leap.

Starting a business is a huge deal and consumes huge amounts of your time. If
the sums don't add up - that is, you're not going to be profitable unless you
work as slave-labour in your own business - maybe you shouldn't do it. I think
this is a trap that many educated people fall into that don't have direct
business (or time billing) experience.

This is applicable to tech as well - if you build a product, sell it super
cheap (say, software @ $20 per year), and it takes around 1 hour per year in
technical support per user (per year), you need to consider that when pricing.
It may not be worth it. Or you may just have your pricing or business model
wrong.

