Welcome

Your Morning Java

Coffee is a recognized worldwide beverage for many who enjoy the aroma and flavor, besides its capping off a wonderful meal, the successful business deal or an intimate social event that surrounds “going for coffee”. As the 180 million drinkers enjoy the warm brew, the more than 18,000 speciality coffee shops aim to please, even in the smallest of towns. The popularity continues as a well-known chain opens four new stores daily as 66% of Americans drink coffee outside the home. However, Americans drink 300 million cups daily and 75% of those mugs of coffee are homemade versions. Furthermore, you may find fewer seats at the local coffee shop as coffee drinkers take their wireless laptops along and stay longer than most other customers.

A market niche is emerging around the concept of coffee roasting, according to the Speciality Coffee Association of America. Coffee shop owners differentiate their coffee from others by creating special blends and customizing their methods of roasting the green coffee beans, either arabica or robusta. Arabica beans, grown in the shade, provide more flavor and aroma with half the caffeine of robusta, which grows in lower elevations.

No matter what the beans or the specialty blend created, the beverage appeals to the middle-aged and older householder between 35 to over 75 years old, with the peak in the 45-to-54 age group according to New Strategist’s Best Customers. It remains to be seen whether today’s youth will switch from soda pop to coffee by age 35.

- Judith Johnson

Industry Snapshot: Coffee Shop

The coffee business has boomed in recent years, especially with regards to specialty coffees. The market for specialty coffees has grown as consumers become more educated about espresso-based drinks and how they are made.

- Haley Holmes

Take a look at our full industry report on Coffee Shops (PDF Format). If you are interested in other industry snapshots, visit our SBDC Business Advisors' Toolkit.

Links of Interest

National Coffee Association
Specialty Coffee Association of America
Coffee Quality Institute
International Coffee Organization

Did You Know?

SBDCNet recently filled its 23,000th request placed by Ms. Dona Leavens of Rapid City , South Dakota . A call of notification went out to congratulate her and she provided some insight on the research service to help her with a bagel shop startup. Dona said that we do a “great job” and that we are “ quick”, especially with the email format, which she really “loves”. SBDCNet on average saves her two hours at a minimum. She has been a consultant in the Network since 2002.

- Judith Johnson

Are You Paying Attention to
Demographic Trends?

Where is the best location for your business? Who will be your best customers? Large businesses spend time and money to develop and refine strategies to gain customers. Part of their strategy is to locate in the best places in order to sell to their targeted customers. You can choose the best location for your business by imitating the strategies of competitor or complimentary businesses.

How can you find out retail location plans? Publicly traded companies are required to file reports to the Securities and Exchange Commission. These reports are rich with information about the reported businesses, including information about their target customers, and location strategies. For instance, a search on “ Dollar General” at http://edgarscan.pwcglobal.com/servlets/edgarscan reveals that Dollar General’s target customers are low to middle income and live within five miles of their locations and/or live in towns of less than 20,000. Further information is revealed about their merchandising strategies (convenience products) and real estate plans. If you are planning to open a dollar store or sell goods found at dollar stores, it would be a good strategy to imitate Dollar General. In some cases, you may not be selling the same products, but targeting the same types of customers, so you may want to explore the strategies of complimentary businesses. (Say if your target was young professional women you may want to explore stores like Chico’s).

By extracting information from these retailers, you can develop your own “best customer” profile and seek areas that fit the target demographic.

- Mike Cline

Contact Us

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