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10 Cost-Saving Hacks for Coffee Shop Owners: How to Increase Profits Without Compromising Quality

10 Cost-Saving Hacks for Coffee Shop Owners: How to Increase Profits Without Compromising Quality

TLDR

Running a coffee shop is all about striking the right balance between quality and profit. As a small business owner, we understand your need to keep costs under control without compromising what makes your coffee shop special. That's why we've put together some clever tips to help you save money while maintaining the high standards your customers love. From cutting waste and chatting with suppliers to simplifying your menu and cross-training your staff, these practical hacks will boost your financial freedom without compromising your coffee shop's charm. Let's dive into these 10 essential cost-saving measures that can revitalize your coffee shop and bolster its long-term success.

Is your coffee shop menu feeling a bit cluttered? Time to spice things up and optimize your offerings for better profits. Here are a few hacks to save money in your coffee shop:

Streamline Your Menu With These 3 Easy Hacks

Focus on Best-Sellers

Let's give the spotlight to your stars – identify those top-selling, profit-boosting menu items. Give them the spotlight they deserve. Feature them prominently on your menu to catch the eye of your customers. The more you showcase these favorites, the more you'll see your profits grow.

Simplify Your Options

It's true that less can be more. A vast, complicated menu can overwhelm both you and your customers. To trim down your workload and increase efficiency, cut down on underperforming items and trim each menu category to a manageable 3-5 options. Customers appreciate the simplicity, and you'll waste fewer ingredients and time.

Bundle for Added Value

Who doesn't love a great deal? Boost your customers' excitement with bundles and combo meals that offer value for money. Think about pairing a steaming cup of coffee or tea with a delectable pastry. Or perhaps, create a combo with a few mini-quiches and a crisp, fresh salad for a quick lunch. What's even better? Price these bundles at a 10-15% discount from the individual items. It's a double win – you'll increase your check totals and introduce your patrons to new items they might just fall in love with.

Save on Labor Costs With a Mobile Ordering App

A mobile ordering app can help reduce labor costs for coffee shops in several ways:

Streamline Ordering and Payment

With an online ordering app like Per Diem, your customers can place their orders and pay in advance. No more back-and-forth at the counter, which means your employees can focus on what they do best - making great coffee and providing top-notch service. Imagine shorter lines during those busy hours, happier customers, and your staff working efficiently.

Optimize Staffing Levels 

By analyzing data from your app, you can gain valuable insights into your busiest days and times. Use this information to properly staff your shop so you have enough employees scheduled when needed but aren’t overstaffed during slower periods. Our app also allow you to set average time required to prepare different menu items, allowing you to determine optimal staffing levels for efficient order fulfillment.

Reduce Errors

Ever had a mix-up in orders? It happens. But with a well-designed mobile app, your customers get a clear view of the menu, and they can pick their choices with ease. No more guessing games. And no more unhappy customers or wasted resources on remakes.

Sure, investing in a mobile app may sound like a leap, but the benefits it brings to your business can be truly rewarding. Not only does it save you money, but it also enhances the overall customer experience.

Get the Most Out of Your Coffee Beans

To maximize profits from your coffee beans, employ the following strategies:

Buy in Bulk

Think big when it comes to buying coffee beans. We're talking 5 or 10-pound bags here. Buying in larger quantities can cut your costs by a whopping 20-30% per pound compared to those smaller bags. As long as you store them properly, these beans can stay fresh for 2-3 months. And here's the trick - choose versatile beans that can play well in both espresso and drip coffee.

Find Alternatives to Premium Beans

Premium beans are great for those fancy specialty drinks, but not every cup needs them. Opt for some less expensive blends for your regular brewed coffee and cold brew. They might not be premium, but they still deliver quality taste. These beans are about 30-50% cheaper and work like a charm for larger batches.

Use Brewing Methods that Make the Most Coffee

Ever thought about how to get more coffee from fewer beans? Cold brew and drip coffees are your answer. They can extract up to 70% of the coffee in each bean, while espresso only gives about 25%. Make these high-yield brews the stars of your show and watch your profits rise.

Don’t Skimp on Training

Don’t cut corners on training your baristas. They need to measure, grind, and brew coffee with precision. A well-trained team means every bean is used to its full potential. When the process is inconsistent or improper, you end up using more beans to make the same coffee. Keep the training ongoing to keep that coffee quality high and the bean wastage low.

So, it’s all about using your beans wisely and making the most out of every batch.

Efficient Staffing

To keep your coffee shop running efficiently without compromising quality or service, consider optimizing your staffing. An efficient schedule and workload distribution can help reduce labor costs, one of the largest expenses for most cafes.

Cross Train Employees 

Your staff should be as versatile as your coffee menu. Cross-training is the secret sauce. When your baristas double as cashiers, and vice versa, you've got yourself a flexible squad. This means you can optimize staffing for any situation, reducing the chances of overstaffing one area while understaffing another.

The Staggered Shift Shuffle

Let’s ditch the all-start-and-end-at-the-same-time routine. Stagger those shifts. When your employees have different start and end times, it ensures you've got enough hands on deck during the busiest hours. or example, have some employees work 7 AM to 3 PM, some 9 AM to 5 PM, and some 11 AM to 7 PM. This way,  you're not burning extra cash on staff that isn't needed. 

Trends for Smart Scheduling

Having a mobile app that stores and shows real-time records of your sales, traffic, and busiest times will help you identify trends to optimize your staffing. Review these records regularly to see if any changes need to be made to your scheduling. Is Wednesday busier than Saturday? Adjust your schedule accordingly to avoid understaffing during your coffee rush and overstaffing during sleepy Sundays.

Streamlining Supply Management

To streamline your supply management and cut costs, consider the following:

Centralize purchasing

Every coffee shop needs a primary buyer who takes charge of all your purchasing. By designating a primary purchaser, you ensure consistent and efficient ordering. This hero is empowered to scout out the best deals, negotiate bulk discounts, and consolidate orders. With great power comes great coffee savings!

Build Inventory Management System 

Inventory management is no magic trick. With an automated system in place, like the integrated Square POS in the Per Diem App, you'll know exactly when to restock those coffee beans, milk, or those pastries your customers adore. This system will:

  • Connect to your Square POS to track sales and forecast demand.
  • Set reorder points to prompt purchasing before stockouts.
  • Provide reports on product waste, best/worst sellers to adjust your menu.
  • Manage expiration dates to reduce spoilage. Some systems even provide alerts when products are close to expiration.

Negotiate with Suppliers 

Your suppliers are your best friends in this cost-cutting journey. Channel your inner negotiator and work with them to get the best rates. Ask about: 

  • Volume discounts for large, recurring orders.
  • Paying invoices early in exchange for a discount.
  • Product donations or giveaways you can offer customers.
  • Exclusivity contracts in exchange for lower prices.

Reduce Waste

Waste not, want not. Your coffee shop may generate waste, but that doesn't mean it needs to go to waste. 

  • Only brew what you need and adjust based on sales.
  • Donate leftover pastries to local charities before they expire.
  • Compost used coffee grounds and food waste. Some waste collection services will pick up compost for a fee.
  • Only provide extras like stirrers, napkins and condiments on request. This cuts down on unused items.

With some effort, you can significantly slash those costs through improved supply chain and waste management practices. Trim expenses and boost your bottom line one hack at a time.

Final Thoughts

As a coffee shop owner, your journey to profitability doesn't mean compromising on quality. It's all about making smart choices that enhance your customer's experience and your bottom line. These hacks, from menu optimization to efficient staffing, are your tools to boost your cafe's success without sacrificing its unique charm. With some creativity and an eye for efficiency, you can make your coffee shop profitable without sacrificing what makes it special. 

10 Cost-Saving Hacks for Coffee Shop Owners: How to Increase Profits Without Compromising Quality

10 Cost-Saving Hacks for Coffee Shop Owners: How to Increase Profits Without Compromising Quality
by
Soma Amir
by
Doron Segal
by
Tomer Molovinsky
by
Olivia Terenzio
by
Jessica Buckley
by
Ashley Rodriguez
March 25, 2020

TLDR

Running a coffee shop is all about striking the right balance between quality and profit. As a small business owner, we understand your need to keep costs under control without compromising what makes your coffee shop special. That's why we've put together some clever tips to help you save money while maintaining the high standards your customers love. From cutting waste and chatting with suppliers to simplifying your menu and cross-training your staff, these practical hacks will boost your financial freedom without compromising your coffee shop's charm. Let's dive into these 10 essential cost-saving measures that can revitalize your coffee shop and bolster its long-term success.

Is your coffee shop menu feeling a bit cluttered? Time to spice things up and optimize your offerings for better profits. Here are a few hacks to save money in your coffee shop:

Streamline Your Menu With These 3 Easy Hacks

Focus on Best-Sellers

Let's give the spotlight to your stars – identify those top-selling, profit-boosting menu items. Give them the spotlight they deserve. Feature them prominently on your menu to catch the eye of your customers. The more you showcase these favorites, the more you'll see your profits grow.

Simplify Your Options

It's true that less can be more. A vast, complicated menu can overwhelm both you and your customers. To trim down your workload and increase efficiency, cut down on underperforming items and trim each menu category to a manageable 3-5 options. Customers appreciate the simplicity, and you'll waste fewer ingredients and time.

Bundle for Added Value

Who doesn't love a great deal? Boost your customers' excitement with bundles and combo meals that offer value for money. Think about pairing a steaming cup of coffee or tea with a delectable pastry. Or perhaps, create a combo with a few mini-quiches and a crisp, fresh salad for a quick lunch. What's even better? Price these bundles at a 10-15% discount from the individual items. It's a double win – you'll increase your check totals and introduce your patrons to new items they might just fall in love with.

Save on Labor Costs With a Mobile Ordering App

A mobile ordering app can help reduce labor costs for coffee shops in several ways:

Streamline Ordering and Payment

With an online ordering app like Per Diem, your customers can place their orders and pay in advance. No more back-and-forth at the counter, which means your employees can focus on what they do best - making great coffee and providing top-notch service. Imagine shorter lines during those busy hours, happier customers, and your staff working efficiently.

Optimize Staffing Levels 

By analyzing data from your app, you can gain valuable insights into your busiest days and times. Use this information to properly staff your shop so you have enough employees scheduled when needed but aren’t overstaffed during slower periods. Our app also allow you to set average time required to prepare different menu items, allowing you to determine optimal staffing levels for efficient order fulfillment.

Reduce Errors

Ever had a mix-up in orders? It happens. But with a well-designed mobile app, your customers get a clear view of the menu, and they can pick their choices with ease. No more guessing games. And no more unhappy customers or wasted resources on remakes.

Sure, investing in a mobile app may sound like a leap, but the benefits it brings to your business can be truly rewarding. Not only does it save you money, but it also enhances the overall customer experience.

Get the Most Out of Your Coffee Beans

To maximize profits from your coffee beans, employ the following strategies:

Buy in Bulk

Think big when it comes to buying coffee beans. We're talking 5 or 10-pound bags here. Buying in larger quantities can cut your costs by a whopping 20-30% per pound compared to those smaller bags. As long as you store them properly, these beans can stay fresh for 2-3 months. And here's the trick - choose versatile beans that can play well in both espresso and drip coffee.

Find Alternatives to Premium Beans

Premium beans are great for those fancy specialty drinks, but not every cup needs them. Opt for some less expensive blends for your regular brewed coffee and cold brew. They might not be premium, but they still deliver quality taste. These beans are about 30-50% cheaper and work like a charm for larger batches.

Use Brewing Methods that Make the Most Coffee

Ever thought about how to get more coffee from fewer beans? Cold brew and drip coffees are your answer. They can extract up to 70% of the coffee in each bean, while espresso only gives about 25%. Make these high-yield brews the stars of your show and watch your profits rise.

Don’t Skimp on Training

Don’t cut corners on training your baristas. They need to measure, grind, and brew coffee with precision. A well-trained team means every bean is used to its full potential. When the process is inconsistent or improper, you end up using more beans to make the same coffee. Keep the training ongoing to keep that coffee quality high and the bean wastage low.

So, it’s all about using your beans wisely and making the most out of every batch.

Efficient Staffing

To keep your coffee shop running efficiently without compromising quality or service, consider optimizing your staffing. An efficient schedule and workload distribution can help reduce labor costs, one of the largest expenses for most cafes.

Cross Train Employees 

Your staff should be as versatile as your coffee menu. Cross-training is the secret sauce. When your baristas double as cashiers, and vice versa, you've got yourself a flexible squad. This means you can optimize staffing for any situation, reducing the chances of overstaffing one area while understaffing another.

The Staggered Shift Shuffle

Let’s ditch the all-start-and-end-at-the-same-time routine. Stagger those shifts. When your employees have different start and end times, it ensures you've got enough hands on deck during the busiest hours. or example, have some employees work 7 AM to 3 PM, some 9 AM to 5 PM, and some 11 AM to 7 PM. This way,  you're not burning extra cash on staff that isn't needed. 

Trends for Smart Scheduling

Having a mobile app that stores and shows real-time records of your sales, traffic, and busiest times will help you identify trends to optimize your staffing. Review these records regularly to see if any changes need to be made to your scheduling. Is Wednesday busier than Saturday? Adjust your schedule accordingly to avoid understaffing during your coffee rush and overstaffing during sleepy Sundays.

Streamlining Supply Management

To streamline your supply management and cut costs, consider the following:

Centralize purchasing

Every coffee shop needs a primary buyer who takes charge of all your purchasing. By designating a primary purchaser, you ensure consistent and efficient ordering. This hero is empowered to scout out the best deals, negotiate bulk discounts, and consolidate orders. With great power comes great coffee savings!

Build Inventory Management System 

Inventory management is no magic trick. With an automated system in place, like the integrated Square POS in the Per Diem App, you'll know exactly when to restock those coffee beans, milk, or those pastries your customers adore. This system will:

  • Connect to your Square POS to track sales and forecast demand.
  • Set reorder points to prompt purchasing before stockouts.
  • Provide reports on product waste, best/worst sellers to adjust your menu.
  • Manage expiration dates to reduce spoilage. Some systems even provide alerts when products are close to expiration.

Negotiate with Suppliers 

Your suppliers are your best friends in this cost-cutting journey. Channel your inner negotiator and work with them to get the best rates. Ask about: 

  • Volume discounts for large, recurring orders.
  • Paying invoices early in exchange for a discount.
  • Product donations or giveaways you can offer customers.
  • Exclusivity contracts in exchange for lower prices.

Reduce Waste

Waste not, want not. Your coffee shop may generate waste, but that doesn't mean it needs to go to waste. 

  • Only brew what you need and adjust based on sales.
  • Donate leftover pastries to local charities before they expire.
  • Compost used coffee grounds and food waste. Some waste collection services will pick up compost for a fee.
  • Only provide extras like stirrers, napkins and condiments on request. This cuts down on unused items.

With some effort, you can significantly slash those costs through improved supply chain and waste management practices. Trim expenses and boost your bottom line one hack at a time.

Final Thoughts

As a coffee shop owner, your journey to profitability doesn't mean compromising on quality. It's all about making smart choices that enhance your customer's experience and your bottom line. These hacks, from menu optimization to efficient staffing, are your tools to boost your cafe's success without sacrificing its unique charm. With some creativity and an eye for efficiency, you can make your coffee shop profitable without sacrificing what makes it special. 

Soma Amir

About the author

Doron Segal

About the author

Hey I'm Doron, the co-founder & CTO of Per Diem — a mobile app platform for restaurants. I'm also a dad and a husband. I love to travel and meet new people.I love creating things, and see people using the stuff I built.Prior to Per Diem I worked at Saildrone, OpenTable, Apple, Beats Music, Siemens.

Tomer Molovinsky

About the author

A second time founder with a passion for building products at the intersection of hospitality and technology. I've had the pleasure of launching reservation systems, mobile payment solutions, and loyalty programs at OpenTable and Resy, and witnessed how operators were losing a direct connection with their customers online. We built Per Diem to strengthen the relationships that businesses have with those customers, and to ensure that local businesses can thrive in today's economy.

Olivia Terenzio

About the author

Jessica Buckley

About the author

Ashley Rodriguez

About the author

Ashley is a freelance writer and podcast producer based in Madison, Wisconsin. She hosts a podcast called Boss Barista and writes an accompanying newsletter with full transcripts of each episode and articles about coffee and restaurant work. You can check out her work here (ashleyrodriguez.work/).

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