The coffee shop culture has gripped the Indian landscape – the cliche of meetings over cappuccinos and laptops laid out on tables in cafes with aesthetic decor has fuelled the entrepreneurial energies and synergies, quite literally. On one hand, chain cafes have forayed into the cosmopolitan cities, and on the other hand, people increasingly prefer quaint places to work from. No wonder then, that the Indian Food & Beverage industry has seen unprecedented growth in recent years. According to the National Restaurant Association of India (NRAI), the restaurant industry is expected to contribute about 2.1% to the total GDP of India by 2021. In fact, coffee shops / cafés market in India is projected to grow at a CAGR of over 11% during 2016-2021 accelerated by a large share of young population, increasing disposable income levels, changing consumer lifestyles and a shoot in the population of urban working women. So if you have always wanted to own a cafe of your own, the time is ripe for it. If you plan to capitalize on the trend, here’s a 10-step guide to help you make all vital decisions before you open your own cafe.
- Research the Business: First and foremost, it is important to understand the dynamics of the business. Visit other cafes, reach out to veterans in the field, and try to learn more about the customer base you are planning to cater to.
- Create a Business Plan: Do not underestimate the power of documentation. Having a vision is futile if you cannot translate it into actionable items under a business plan. A business plan helps you get a hold on your concepts. Make sure it includes:
- A summary of what the cafe will look like, serve and do uniquely.
- A solid idea of who the cafe will serve, the competitors, the staff
- Marketing and PR for the cafe
- And most importantly, the financial nitty-gritty, which brings us to the third step
- A summary: What this business stands for, and how it’s going to stand out.
- A local market analysis: Who are your regular customers? Who are your competitors?
- Your team: What are you going to do yourself, who are you hiring to do the rest.
- A marketing plan: What is your point of difference? How are you going to communicate this?
- How much cash you need to get started and where it’s coming from.
- Financial projections: Projected Profit & Loss, Cash Flow
- A location and lease strategy.
- Evaluate costs and sources of investment: Opening a cafe will be a huge undertaking and commitment. As an aspiring ‘foodpreneur’, you need to take into account the financial aspect, beginning with the question of the source of the seed capital necessary. Once you finalise how much capital is needed, you can look for options. Remember to start wisely, because once your cafe has already been running for three years, you can also avail a business loan for expansion. This is because the cafe will require a lot of working capital expenses too, from the cost of regular supply to the overheads like equipment, interiors, licenses and marketing. The latter especially becomes crucial as your business expands. To avail a business loan for your start-up from Finserv MARKETS, you can simply apply online, get approval in 3 minutes and money in your account in 24 hours! The repayment tenures range from 12-60 months and you can get a loan for up to Rs 15 lakh without the need for a guarantor.
- Location and Licenses: Scouting the right location will be key to the cafe’s success. Look for a location that is conveniently accessible by your target group and fits the personality of the cafe. Not only does it have a major financial implication in the form of rent, but it also determines whether the entity will be a success at all.
- Find the Suppliers: The next obvious step is to find good, reliable suppliers for coffee, milk, bread, fresh produce, etc. Also, ensure availability in the vicinity so that stocks can be refilled timely.
- Source Commercial Equipment: You’ll need to invest in a commercial blender, refrigerator, dishwasher, cash register, oven, and other heavy appliances. Again, you can start small on this front, but once you enter expansion mode, this may chalk up to significant expenditure, so you may want to finance this through a tailor-made business loan that can be availed online from Finserv MARKETS.
- Establish identity with design, decor and dazzle: Your brand is how people are going to identify the cafe.
- Set up the menu: What will your signature dish? Are you going to focus on beverages? Will you serve gluten-free? Do you think your potential customers would seek non-vegetarian options? Decide.
- Hire the staff: You cannot manage all the activities of the cafe alone – get yourself the required number of staff members to work in the kitchen, to wait tables, among other things.
- Spread the word: Marketing is the most important activity once the cafe is all set and welcoming customers. Hit up some food bloggers and influencers, spread the word in the local paper and distribute menus and flyers with offers and opening discounts. Then wait to welcome a steady inflow of diners and foodies.
Once you’ve made a mark in the restaurant and cafe landscape, expansion and opening of newer outlets are the obvious, yet ambitious goal. You will realize that the expenses add up – from the decor to kitchen supplies and rent – the best bet is to get a business loan that can help you finance the expansion. With easy and speedy options like Finserv MARKETS, your dream can become a reality within minutes. As an exclusive benefit of a Bajaj Finserv Business loan, you only pay the business loan interest rate amount as the EMI during the initial period of your business Loan.
When you choose a custom-made Bajaj Finserv business loan, you get the options of flexible repayment tenures and access to your personalized Financial Fitness Report.
“Finserv MARKETS, from the house of Bajaj Finserv, is an exclusive online supermarket for all your personal and financial needs. We understand that every individual is different and thus when you plan to achieve your life goals or shop for the gadget of your dreams, we believe in helping you Make it Happen in a few simple clicks. Simple and fast loan application processes, seamless, hassle-free claim-settlements, no cost EMIs, 4 hours product delivery and numerous other benefits. Loans, Insurance, Investment and an exclusive EMI store, all under one roof – anytime, anywhere”!