Beginner’s Guide on Starting a Coffee Shop Business in the United Kingdom
Java, jamoke or a cup of joe, call it what you like; coffee is a staple most people simply cannot do without. It is a dose of morning boost most people seek when they start their day. But coffee is more than just a drink. It has already established itself as a lifestyle activity that forms the nexus of our society. That being said, starting a coffee shop business is only wise given the great demand for the beverage–and it is only seen increasing.
Coffee shops–which sell coffee, tea and other consumables–are a booming business where people socialize. It has become a place where friends gather and on-the-go commuters rest for a while to have their drinks.
What is a Coffee Shop Business: Exploring British Café Culture
One of the oldest coffee shops in the world is the Venetian Caffé Florian, which has been operating since 1720. Just imagine how many cups of coffee they have prepared and how many customers they have served already.
The first coffeehouse in England opened in 1652 and proved to be a popular concept. These penny universities attracted the intellectuals of society, who had polite discourse over a one-penny coffee cup. The most famous was Jonathan’s Coffee House, which saw the beginnings of the London Stock Exchange. Undeniably, coffee shops provide that atmosphere where one can think and talk about almost everything.
Despite being known as a tea-drinking nation, there is a huge coffee shop market in the United Kingdom. Statistics for 2018 indicate that coffee consumption rose to 95 million cups of coffee per day. The UK also lays claim to being the largest branded coffee shop market in Europe. As of 2019, there were more than 25,000 coffee shops in the UK. It is seen as a resilient and sustainable sector that is expected to weather the pandemic and return to growth.
Starting your coffee shop business requires you to decide early on whether you want a franchise or your own brand. If you prefer your own brand, then being unique and niche is the only way to succeed. When researching and writing out your business plan, explore your target market as well as emerging trends. It might also help if you can gain some experience as a coffee barista.
Allow us to give you some pointers because starting a coffee shop business may be quite a handful. You will provide you with all the information you need, from planning your business to company registration in UK.
Industry Trends: Coffee Shop Branding and Concept
Just like in any business, you have to set yourself apart from competitors. When starting a coffee shop business, you already know there are many of the same establishments out there. So you have to make an impact by differentiating your brand.
You have to pinpoint your unique selling point. Is your coffee shop going to market a certain coffee bean you believe is superior? Will you be giving focus on supporting the local coffee farmers? Do you have a niche on environment-friendly products and lifestyle?
You have to give something more than just a cup of coffee to your customers. You must represent something bigger, whether it is cause, purpose or better product offering. Long story short, you have to stand out.
Meanwhile, your establishment must also have a strong concept that can attract customers. Generally, coffee shops should have a welcoming and calming environment; but, then again, there must be something more than that. It is helpful to have a theme for your coffee shops and your creativity is your limit.
Of course, a coffee shop business is not just about the coffee you sell but also the location and shop design. You want a location such as an office or shopping district, subway link, anywhere with a high footfall. Your shop design can be anything from a pop-up to a coffee kiosk or a fancy French café.
You can take professional business advisory services for branding and company incorporation.
Studying the Market Demand
Before starting a coffee shop business, it is wise to do your own research first. It can help you be more profitable in the future.
By simply talking to people, you might be able to identify the following:
- menu items
- preference on dine-in services and takeout deliveries
- opening hours for most customer traffic
- praises and complaints from other coffee shops in your area
Having these discussions with the usual coffee shop goers can truly help you be on the right track. You can be given an early warning of the dos and don’ts of starting a coffee shop business.
Take note, however, that the prior market research is not the end of it. You would still have to evaluate your coffee shop’s performance in terms of sales, product offerings and customer satisfaction. You have to identify what is and what is not working so you can keep moving forward. Being stagnant can lose you customers.
Promotions for Your Coffee Shop Business
As mentioned, there are many coffee shops already in the game. One way of attracting customers toward your way is by offering discounts and special offers. These are proven to be great promotional tactics for every business.
You can offer discounts and special offers to your loyal customers. For example, buying a certain number of a certain product can qualify them to have free purchase the next time. You can also provide discounts during holidays to boost your sales.
When you decide on this matter, remember that you have to brief your employees well. They have to know who qualifies for the discount and special offers or when the customers can cash in their rewards.
Having a website and domain name will also enable you to have an online presence. Nowadays, having an online presence is only as important as having your physical store. This is where people can actually know more about your shop. So, build one and make it good.
Registering a Coffee Shop Business in the United Kingdom
To avoid legal consequences, register your business properly with the HMRC and Companies House first before operating.
HMRC, or Her Majesty’s Revenue and Customs, is a non-ministerial government department tasked with collecting taxes, paying of the state support and enforcing regulatory regimes such as the national minimum wage.
Companies House, meanwhile, is the registrar of companies.
When starting a coffee shop business, it is advisable to register it as a limited company. It allows you to enter into leases and secure loans for the initial funding of the venture if you have to.
The most important consideration in running a coffee shop business is getting your compliance in order. The food industry is regulated by the Food Standards Agency (FSA) and approvals from the local area council. You may need planning permission for your café, registration for your food and drink business, and health and safety inspections.
Licences and Permit For Your Business
Because coffee shops fall under the food business category, you will have to secure with the local authority the permit to sell, cook, store, prepare and store food. A local council can give you the stamp of approval to proceed with the venture.
If you are the type of coffee shop that would like to hold events from time to time, you also have to secure temporary event notices from your local council. This will allow you to serve food between 11 PM and 5 AM and even serve alcohol during occasions.
We Can Help You Out
If all these considerations seem daunting, do get in touch with our team at 3E Accounting. We are an excellent corporate service provider in United Kingdom and we are eager to help you today.
We offer guidance on how to set up a coffee shop business in the UK as well as company formation packages. Our suite of solutions can be customised to your business needs and preferences. Contact 3E Accounting today to begin your entrepreneurial journey on a successful note.