The Opportunities, Advantages, and Challenges of a Coffee Cart Business
In essence, a coffee cart business consists of a mobile coffee stand fitted with a coffee machine and other necessary equipment. It’s a great alternative to opening a brick and mortar coffee shop since you have much lower set-up costs, no rent and, best of all, you’re mobile and flexible.
Since virtually everybody drinks coffee, a coffee cart is an excellent business opportunity both in small towns and big cities. This is mainly because, similar to hot dog carts, a mobile coffee stand caters to people on the move, a promising demographic considering that most of us spend 70% of our time out of home.
And if most people have a daily budget dedicated to their needs, a daily on-the-go coffee is most certainly included. Stopping by a coffee cart and getting an espresso or a latte on their way to work or at lunch is something that they can afford to splurge on, even when they are keeping a close eye on their spending.
The Main Advantages of a Coffee Cart Business
– Low start-up costs: you can start a mobile coffee business even on a tight budget as a simple coffee cart can be bought for as little as EUR 4000.
– Coffee is a growing trend: the coffee business is growing, and there are many coffee connoisseurs who will forego the tasteless vending machine coffee and get a high quality one instead. This is only going to continue.
– Great Profit Margins: coffee offers incredible gross profit margins of up to 90% which is what has attracted the big companies to expand at such a rapid rate. Very few other products even come close, meaning that you have the potential to make a lot of money.
– A year round product: some products are very seasonal, but coffee is no longer one of them. Yes, you won’t sell as many on hot days, but let’s be honest, they are few and far between.
– Flexibility: many people operate a mobile coffee cart business to fit around their lifestyle, choosing only the odd show or event. Others choose to do it as a career, operating a daily in the town centre or retail park. The great thing is that this kind of venture can be run part time, on evenings outside a club or on weekends, at various events around the country. Overall, a coffee cart business is very flexible.
The Main Challenges of a Coffee Cart Business
– Competition: the expansion of the “good coffee” market means there are more potential customers but also more competition. Your product will either have to be competitively priced, of a higher quality or come with better service. If you plan to only cater to events, bear in mind that other stands will also offer hot drinks and many customers will not queue twice, even if it means settling for inferior products. So work out a strategy that will allow you to outdo your competition.
– Skill: people love good coffee and every barista will tell you that it takes skill to make one. Therefore, you’ll need to practice your skills and learn how to get the best results out of your equipment. You’ll also want to develop an understanding about a variety of blends and preparations, gaining knowledge about how different flavours work together to create the perfect drink. Your level of skill and understanding may well determine whether your business is successful or just average.
– Brand loyalty: many people already have a preferred outlet for their morning or lunch coffee. This can make it a bit more difficult to break into the industry initially.
To sum up, now has never been a better time to start your coffee business. The market base continues to grow beyond anything we’ve seen before and, as long as you do your research and plan properly, you have every chance to make a solid profit out of it.