SYSTEMS – YOUR COFFEE SHOP'S PROFIT PLUG
Fundamentally, I believe there are three key ingredients to having a profitable coffee shop, cafe or small hospitality business:
Step 1 – Get clarity
Step 2 – Implement the right systems
Step 3 – Develop your strategy
This is what my Profitable Coffee Shop Programme is all about. However, I can appreciate that these steps can feel intangible. So, in this blog post, I want to explore a little more about what ‘implement the right systems’ will actually mean for you and why it matters.
The importance of IMPLEMENTING SYSTEMS TO HELP YOUR COFFEE SHOP MAKE A PROFIT
As an accountant and finance mentor who genuinely cares about your success, I see a common thread running through many independent coffee shops and cafes here in the UK:
the struggle with increasing costs in an industry where margins are already incredibly tight.
It’s tough, I know. You’re pouring your heart and soul into creating a fantastic experience for your customers, but if you’re not truly understanding your finances, you could be:
- spending money in the wrong places
- undercharging for your amazing products
- never seeing the rewards of all your hard work
So, what’s the answer? It’s all about implementing smart coffee shop systems and processes to truly understand your financial reality and track your progress.
Think of it as gathering all of your ingredients before you start baking. When you have easy access to your numbers, you can make informed decisions based on solid information, not just a gut feeling.
Without robust systems and processes, you’re essentially operating in the dark. You’ll likely overspend unnecessarily, leaving you exhausted, overworked, and with precious little cash in the bank. However, with easy-to-use systems that you feel comfortable using, you’ll have a clear, easy way to check exactly where you stand at any given point.
The beauty of a coffee shop business is its agility.
You can make changes quickly, easily, and often without huge expenses. Having the right systems and processes in place means you’re able to do this effectively. Together, we can constantly analyse way to improve the profitability of your coffee shop or cafe business. Crucially, identifying ways to enhance your own quality of life.
The Bathtub Analogy: Why you need a system to help you know your numbers
There are many problems with not really knowing your numbers and the state of your finances, with ease. Therefore, a good accounting system (like Xero), POS systems and good processes that actually support you to run your business sound like a good idea. Right?
However, I know too many who never get round to it! And I want to send out a warning
When you don’t know your numbers, you’ll overspend. The common outcome of this is that is leaves no funds to take home for yourself. No pay. And we all know that paying yourself is absolutely key in any business – you deserve to reap the rewards of your dedication!
I often use this analogy:
Running your business without the numbers is like trying to fill a bathtub without a plug.
You can keep pouring in hot water all day long, but without that plug to hold it in, you’ll never fill the tub. That’s your business without tracking numbers and having the systems in place to help you do it accurately. Money flows in and straight back out, with nothing saved for you to take home.
Don’t just have the systems – use the knowledge they provide
So, you know why you need to know your numbers and have the systems to help provide this knowledge…but it’s not enough to just be able to access them, the power is in what you do with them.
You need to commit to looking at your business numbers regularly. You must make time to truly understand them and actively use them in your everyday business decision-making.
I’ve seen firsthand how “running blind” can cost you dearly. I had a client whose business took off brilliantly. Money was rolling in, and they understandably started enjoying the fruits of their labour – lovely holidays, a home extension, even a new car.
The thing is, they were so busy serving customers and spending money that the books became an afterthought.
When we finally got the paperwork done, just before the tax deadline, they got the shock of their lives.
“But I can’t pay that much tax!” they exclaimed.
They ended up having to raid their pension just to keep the business going – all because they didn’t know what was truly coming in and going out, and what they owed.
This is completely avoidable with good financial systems in place …and you can still enjoy holidays, cars and home renovations.
Why implementing reliable systems are so important
So, my question to you is: Do you have real and relevant business numbers available for review, thanks to your systems?
If you do, make time to understand them.
If not, don’t hesitate to ask for help setting up and implementing good systems and process that will really support you to run a profitable coffee shop or cafe.
In addition, to setting up the systems, I will ensure that you have access to your numbers at the touch of a button. And, you will actually understand what they are telling you about the health of your business. You can use these numbers and this information again and again to make smart business decisions that will bring you closer to your dreams, one profitable step at a time.
Doesn’t that sound good to you? …all thanks to a new system or two.
While this blog aims to provide helpful information, it’s important to remember that every business and person is unique. So, before making any decisions, we highly recommend seeking professional advice. We want to ensure that you have all the support you need to make the best choices for your situation!
