Article written by Jeremy Streten,
Legal Practice Director and Franchising Lawyer from Streten Masons Lawyers
Most coffee van franchisees are new to the industry in some sense – they have often never run their own company or never made their own coffee before. So, they choose to buy a coffee van franchise for the security and support that comes with buying into an established business.
Others, however, would prefer to start their own coffee van business from scratch. Their main reason for just buying a van and not a franchise is the cost – $120,000 for the franchise as opposed to $70,000 for just the van.
The problem with this logic is that it’s not actually the van that makes your business successful (although the van sales person will say otherwise!). Your product, marketing, business system and experience make the money. In this article, we explain why investing in a coffee van franchise is the best way to start a successful mobile coffee business.
The Perfect Product
It is incredibly difficult but absolutely essential to make amazing coffee, because in this industry people don’t come back for a bad cup.
Many things can make or break a cup of coffee, including:
- Barista’s technique and skillset
- Quality of coffee beans, water and milk used
- Equipment used (grinder, espresso machine, accessories)
Award winning coffee is the secret. Coffee that is so good your customer’s will stay with you for a lifetime, simply because they fell in love with the product. A franchise can supply you with the training, ingredients and equipment to replicate this top notch product.
They will train you with industry secrets learned from years of experience so you will become a highly-skilled barista capable of making the perfect cup. They supply or connect you with the best quality suppliers, so you have beans worth boasting about. And, they supply you with a van fitted with all the equipment you need to make great coffee as well as teach you how to maintain and care for your gear so that your business continues with a first class product.
If you go it alone, you only need to fall short in one of these areas to fail at making excellent coffee. And, in such a competitive industry, there aren’t any second chances when it comes to impressing your customers.
Buying Your Reputation
If you drive into a town that you haven’t been to before, and you want a quick takeaway would you go to Joe’s Burgers & Fries or would you go to McDonalds?
You would go to McDonalds. Why? Because their effective branding assures customers of exactly what they are getting as far as quality, price, product and service are concerned.
When you buy a franchised mobile coffee van, you buy into an established brand with a reputation for exceptional coffee.
People already know that they can expect amazing coffee and friendly service from a successful franchise, so when they equip you with their branded products (including van decals, staff uniforms, business cards, etc.) you can hit the ground running.
A single unknown brand won’t stand a chance against a well-known, established brand.
Franchisor’s Engineer Your Business System & Structure
With a franchised coffee van, you buy a business not just the van. They have already engineered a business system that delivers an efficient and profitable business.
What does a business system mean? Your business system is your day-to-day plan of attack that they help you work out by:
- Conducting area research to figure out where your operation will be most profitable. They do the on the ground market research to pinpoint the exact locations where you will sell the most cups of coffee.
- Working with you to map out a route that will maximise return on investment. Most quality franchise operations fit your van with a computer that allows you to track the distance you’re travelling between stops, the number of stops you’re making, the time spent at these stops and the number of cups you sell per stop. They will then use your end of day reports to customise your route for maximum efficiency and profitability.
- Crafting the proven sales approach your customers respond best to.
The beauty of owning a franchise is that they will work alongside you, using their experience to sort out every part of your coffee run until you have got your routine down pat and are making money.
When you buy a van and start a coffee run on your own, you’ll have to learn all of these things by trial and error.
Experience is Essential
When it comes to running your own business, even if it is a smaller business like a mobile coffee van, the best investment you can make is in benefiting from the lessons learned by people who have gone before you.
Chances are if you haven’t had management experience before then you don’t know how to balance books, create systems, operate accounting software, apply for the correct council permits, make sure your contractors work on time, and place orders correctly.
Without the comprehensive training a coffee van franchise offers, you’ll need to spend a lot of time and money studying a small business course and learning as you go.
Every new business owner will tell you that unless you have previously owned an identical business, there’s simply no way to avoid costly mistakes.
The fixed price of a coffee van franchise is just that. Everything is ready to go from the start, there will be no blowouts and with accurate expenditure figures you’ll be setting yourself up for the best chance at success!
Buying a coffee van franchise allows you to put the time you would have spent on basic business development into a successful business operation.
When it comes to setting up a business, you need to look at your options in terms of both short-term and long-term losses and gains. It is true, buying a coffee van franchise may seem like the more expensive option. However, in reality, it is only taking a short-term loss to secure a long-term gain.