Did you consider paying more than minimum wage? I wonder if a higher wage would enable you to expand your talent pool to folks who would enjoy slinging coffee a couple days a week on the side to improve their situation while actually finding it fulfilling work. The math does seem fixed, there is only so much time in the day and the inputs have fixed costs, but if you can get it all well tuned to the point where effort and time in is worth it then it can just run for a long time until some change in conditions makes you walk away instead of tweaking again. It always seems to me like spending more for a better product should be the first tweak attempted rather than the race to the bottom so many places undertake.
muzani|6 years ago
We weren't competing with other cafes. We were competing with cigarettes. We aimed to be daily, unlike Starbucks.
Our key metric was quantity: 1. The more purchases they make, the more the lock themselves into the habit loop. 2. More quantity means we could negotiate cheaper prices for beans, cups, marketing, etc. 3. The main factor for quality was bean freshness. If a bag is opened for more than an hour, it rapidly loses 70% of its flavor. The faster we go through a 1kg bag of beans, the higher the quality of the next cup. 4. By selling 100-200 cups a day, our baristas skill up far better than those selling 30 cups a day.
Unfortunately, this process requires little skill other than the team being charismatic and pulling in more loyal customers. The race to the bottom is part of the business model. With food & beverage, you start at 20% profit margin and save money by controlling the supply chain (roasting, etc).
The system let us create a better product than the competition, but we couldn't really charge more because the target market just didn't have the money.
1k|6 years ago