| Coffee Franchises - A Tough
Business? Coffee franchises are springing up in almost every town and city
worldwide. It is a tough business to be in when you consider the long
hours, health and safety regulations and numbers of staff required.
When potential franchisees first look at this business they are blown
away by the profit margins. Surely any business that has such high
margins built in must be profitable? In reality it is not as simple as
that. For a coffee shop to be truly successful it needs to generate a
huge number of sales to cover the fixed costs. The fixed costs are
very high primarily due to the fact that business premises are
required in shopping malls and busy high streets. This means that over
half the turnover goes towards covering the rates and rents. A coffee
franchise needs a higher number of employees then most franchises due
to the number of hours the business has to be open. The majority of
turnover is done either before work starts, at lunchtimes, after
working hours and during the weekends. Unlike some other franchises
this is definitely not a nine to five business! Staff costs are very
high and then there is the problem with keeping them. Most employees
in a coffee shop franchise are only doing this work until they manage
to get a better job! This means that there is a constant turnover with
staff and this can be a nightmare to manage. Most new members of staff
will require some training. A coffee franchise usually sells a lot
more then just coffee. Most also supply sandwiches, cakes, pastries
and other snacks. On a busy day it is far too easy to run out of
supplies too early whilst on a quiet day some of the food might have
to be discarded. The regulations involved with selling food to the
public means that detailed records have to be kept. Competitive forces
are also at play with a number of new fast food franchises entering
the scene as well as speciality sandwich makers. These are all
conspiring to take away some of the regular trade from the coffee
franchises. It is still possible to make money with a coffee shop
franchise and to achieve this needs careful planning and the right
strategy. Premises must be found that are on busy thoroughfares for
the right terms. Only the best coffee should be served. Not all coffee
shop franchises adhere to this simple rule!
|
|
