Thinking about opening a cafe?
While starting afresh can be exciting, buying an existing business offers a host of advantages – from a ready-made customer base, established infrastructure, existing staff, through (most importantly) to a proven business model. But it’s not all sunshine and lattes. Potential hidden costs, brand identity conflicts, and employee integration challenges can also come into play.
This blog post dives deep into the pros and cons of buying an existing cafe, helping you decide if this path aligns with your dream of coffee shop ownership.
Pros
Ready-made customer base: With a pre-existing café business, you’ll inherit a loyal following and avoid the initial struggle of attracting loyal customers.
Established infrastructure: Skip the initial hurdles of securing permits, securing a location, and navigating construction. With a pre-existing café business, there’ll be no need to scout locations, build a kitchen, or source and install equipment – it’s all ready to go! … Leaving you to focus on perfecting your latte art.
Proven business model: Whether the cafe focuses on high-volume coffee sales, delivers a specialty and upscale experience, or prioritises food offerings, the pre-existing café is likely to have a proven business model, reducing uncertainty for new owners. You’ll likely know when seasonal fluctuations in footfall and cash flow occur, as well as what profit margins to expect.
Streamlined operations: Existing systems and staff (hopefully!) mean less initial work in setting things up. You can spend less time deciphering the espresso machine manual and more time brainstorming creative coffee concoctions.
Focusing on growth: With the foundations already in place, new owners can leverage their vision and expertise to introduce new menu items, marketing strategies, or operational efficiencies, focusing on growth over building from the bottom-up.
Cons
Hidden costs: Be prepared for potential surprises like outdated equipment, lease restrictions, or inherited debt. Buying a cafe is like buying a used car – always check under the hood.
Brand identity: One of the greatest attractions of café ownership is putting your own unique stamp on your outlet – whether it be Scandinavian minimalism or rustic charm with exposed brick walls and vintage furniture. However, the existing brand might not align with your vision. You’ll need to decide if you want to keep the existing vibe or rebrand entirely, which can be tricky with established customers.
Inheriting challenges: Existing cafes might have operational issues or negative customer reviews. Be prepared to roll up your sleeves and tackle any existing problems.
Employee integration: Managing existing staff can be complex. Their work style, familiarity with past practices, and potential resistance to change might require careful navigation.
Running a business is never a walk in the park. However, buying a pre-existing café business removes a lot of the financial and commercial uncertainties, as well as the legwork of setting up the infrastructure.
