The Next Step. . .

[Anthony Quinn]

Hello All,

I'm in a good position in terms of i have a cafe in Nottingham which now turns over £500K + a year we convert an ok chunk of that to profit but its very labour intensive.

I know the concept is transferable and can become a small chain where the return is a lot better, however i'm very hands on and enjoy being hands on which means I often don't have much time to look at other options

I wondered if anyone on here knows about the ins and outs of expanding a business?
and if anyone out there is interested in joining forces?
And one final question . . . anyone on here know about if you've made a hospitality business successful (ish) what is the likely hood of things falling apart suddenly?

Thank you
Anthony

 

[Deleted member 283937]

I have three cafes so I am aware of the pitfalls and advantages of expanding.
The primary thing to be aware of is don't fall into the trap of thinking "I am already successful I know what I am doing". I see this all the time with businesses and their second sites. Second sites often seem to close down quite quickly. This is just something I have noticed anecdotally. My second site although traded profitably was not the success of my first (second site now since sold). Apply the same caution in choosing a location you did the first time round.
Once you have two sites you will be more thinly spread. Standards and therefore profit will inevitably drop in your first site as no one will run it as well as you did. This is just a fact of life because no one will care as much as you do.
Your staff costs will rise because you are paying for a new level of management to cover what you would be doing if you were on hand running the cafes (you wont be because you will be spread between the two).
The advantages are you will have a larger pool of staff to draw upon. Which is useful when people are sick or are on holiday.
You will have a bit more buying power with your suppliers.
In my experience it feels like more than double the work for about a third more profit. Its not a straight forward open a second site and double my income.
I have no regrets though. It makes life interesting.

 

[ChrisRM]

That's great advice from Café Course.

I'd also suggest checking out The E Myth. Great book on viewing a business as a franchise (even if its not) to get it to run better.

 

[Maulik Patel]

Hey, Anthony, you have set up a good cafe in your city. Now the next step should how can you get the loyalty of your business that retains you existing customers and also attracts new customers too. For that, your cafe needs to change some process while customers are waiting for a table or while waiter serving to them or while they leave the cafe. For example, one couple arrives at the time when your cafe is full. And the customer has not got any seat. In that situation, a chief host or any accountable person start interacting with them and share knowledge how he prepares the strawberry smoothie or anything else that keep them engaged and not get bored.

Changing in the process will surely boost your cafe loyalty. For this kind of improvements, you need to contact digital marketing expert.

 

[Clinton]

I know the concept is transferable and can become a small chain where the return is a lot better, however i'm very hands on and enjoy being hands on which means I often don't have much time to look at other options

You don't seem suited to starting a chain.

And it ain't as easy as many think.

I often come across ambitious small business owners who have something that is reasonably successful and they figure that the way to grow is to become a franchise. It's often the case that these small business owners have boasted to me - even before their first business is profitable - that they'll grow it into a franchise. They usually fail, and they usually fail very badly.

The chances are that you will fail, too. The skills and qualities required to grow this way are significantly different to the skills you used to build your business in the first place. I'd urge you to consider a different route to growth ... or partner with someone who has done this before.

 

[The Byre]

There's a book called 'What got you here, won't get you there!' I can't remember who wrote it or if it was any good, but the basic message was that every step along the pathway to building an ever-more successful business requires a totally different skill set.

The first different skill set is delegation - the ability to hand over the responsibility of a part of your business to somebody else and most importantly, finding the right person to be able to do that task!

The way to keep motivation going, is to involve EVERYBODY in the success of the business. Commission, premiums, that sort of thing. In the movie business, it is called 'points' many of the key figures will be getting tiny slivers (i.e. under 1%) of 'points-on-gross', which means that they get paid a small sum for every dollar turnover the movie makes. (Points on net, means they get nothing!)

The 500lb gorillas (director, leading actors, cinematographer) get serious points of course.

That kind of structure motivates people. Now it's 'their' movie! The lighting guy will take that little bit of extra time to get the colour of the side-fill lights right, because good lighting = eye-candy = box-office = pay-cheque!

Running any business is to be the leader of a team. It is not 'your' cafe - it should be 'our' cafe! Your name may be on the lease and all the other bits of paperwork, but you have to give the members of your team the feeling that they too 'own' a piece of the business, if only by way of commissions and profit shares.

But I would agree with @Clinton, in that you are not ready yet for the next step. You should be running the business and not 'hands-on'. You might like to restructure your business, so that you can find the light and air to take the next step.

Remember the movie analogy! The producer only gets to meet and greet a small number of the hundreds of people involved, but they are all highly motivated and see the entire project as 'their' movie!