In the café business, you can’t afford to rest on your lattes. The drive to keep customers and gain new ones is never-ending, but you can make it fun. Continually steering your business in the right direction is a truly satisfying task, especially when you can measure progress through your bottom line.
Here are some strategies that will help to keep your café, restaurant or bar on the sunny side of profit street.
You’ll be familiar with this strategy, because you’ve probably encountered it at a service station. When you’re paying for your gas, the checkout attendant politely suggests you might want today’s special deal on chocolate bars. It’s usually done in a way that’s not off-putting, so you don’t feel bad about saying “no thanks”.
In the café, bar or restaurant situation, an upsell could involve suggesting the customer might want to upsize or titivate their order, i.e. a large cappuccino or a side of bacon with their pancakes. Or you could put a freshly baked basket of cheese muffins right next to the till and say “these have just come out of the oven” just before a coffee transaction goes through.
Repeatedly upselling on coffee or hot chocolate size can make a big difference to your business performance. If you persuaded just half of your customers to opt for a larger size, you could increase sales by around 12% a year*. Here’s how that works:
*Lets say your café sells around 200 cups of espresso a day and that the price for a small hot drink is $4.50, with the largest size costing $5.20. If all the coffees you sell are small, and you’re open six days a week, you’ll generate about $280,800 a year. If half of those coffees are upsized to a large, the total generated by coffee increases to $302,640. There will obviously be an increase in materials, but quite a big portion of that extra $21,840 would be icing on the cake (profit!).
Adding a $1 biscotti or cookie to 25% of your espresso orders is another way to upsell your daily customers. The biscotti might cost only 20 cents to make, so additional profit would be about $12,480 (based on the average of 200 cups of espresso a day). You can make it fun by calling it the ‘cookie du jour’ and describing the flavour on a chalk board right next to the till.
Marketing is something that needs to happen on purpose, rather than by accident. To keep the customers you’ve got and attract a steady stream of new customers, you need to devise a marketing plan, then put it into action. For your plan, direct your focus to six areas:
In the hospitality world, branding is almost more important than having a decent espresso machine. Your establishment’s name, logo, colour palette, décor style, staff uniform, music and cuisine style all contribute to your brand. If you feel it’s time for a refresh, consider these points:
Logo design is also something best left to an expert. It should fit with your name, theme and colours. Logo design is often more than just your name in a particular font; it can include imagery or icons that fit with your brand.
It’s mind-boggling to realise that just 20 or so years ago, listing cafes and restaurants in the Yellow Pages was considered a smart tactic. People used to actually look places up in giant books!
Obviously, times have changed. Now your first go-to for increasing the profile of your business is the online world, in all its various shapes and forms. Whether you plan to DIY your online marketing or hire a specialist to do it for you, it’s helpful to have a laundry list of online practices that work best for hospitality businesses.
If your establishment is the sort of place that regularly gets positive feedback from customers, harness it. With a table talker, you can encourage clientele to leave reviews on Google, Facebook and Trip Advisor. In New Zealand, Zomato is also a useful platform for reviews.
Of course, the downside of a blanket request for reviews is that you might get the occasional dose of negative feedback. If you’re concerned about this, you can always selectively request reviews from the customers who love you the most.
Make sure you monitor reviews, because there could be information in them that helps to sharpen your service. Taking feedback on board is good for business. The best restaurants in New Zealand are generally humble about feedback, rather than arrogant.
Tourism: Does your café, bar or restaurant rely on tourist trade? If it does, your local tourism authority might be able to send a few bloggers, travel writers or travel agents your way for a free meal, in return for publicity and endorsements.
Loyalty scheme: Lots of cafés run loyalty schemes to keep customers coming back. This can be a simple card, which is stamped every time somebody buys a coffee. Ten stamps equals one free cup. Or you can go techy and get a customer loyalty app, aka digital loyalty programme. Not only do these apps let you reward customers for repeat purchases, but you can use them to push special offers out to your database. For example, ‘earn two loyalty points for every cake purchased on Wednesday’.
Certainly the planet is getting more digital by the day, but we all still live in the real world. And that means plenty of opportunities to promote your business in hard copy. You can:
To encourage word of mouth advertising, which will always be one of the best marketing channels for a food and/or beverage business, it makes sense to treat your service level as ‘work in progress’. The journey to perfect customer service never ends; continuous improvement is a path, not a destination.
If you don’t already run regular staff meetings, consider introducing them as a way to keep everyone up-to-speed on how to win customers over. You can also brainstorm ideas for continually lifting the service level at your establishment. Here are just a few ideas to get you started:
Whatever business insurance you need State has you covered. If you’re in the hospitality industry, you should consider the following types of insurance:
*Based on the average price of a small vs large expresso and calculating the income across the year for both.