Archives: October 2016

Café owners: 7 errors in thinking that can break your café’s business strategy


EQUUS25 October 2016 EQUUSPosted by Equus Partners EQUUSNo Comments


Previously we spoke about the three biggest problems in your café business strategy.

Most of the problems you’re encountering in your café business are being caused by simple but avoidable mistakes that you make unwittingly, and which come back to haunt you.

The problem-causing mistakes for your business fall into two distinct categories:

  1. Mistakes in your thinking
  2. Mistakes in your actions

In this blog, we explore the 7 Thinking Mistakes you may be making that cause problems in your café business.

1. Assuming that your business partners are all on the same page

If you are a café entrepreneur, you will most likely be operating multiple cafés. This means you are likely to have multiple business partners – for instance, one with kitchen experience, one with front-of-house experience, and perhaps even a silent investor.

With each of your café partners, are you on the same page with regard to goals, aspirations and plans for the business? Do you agree with your business partners on future growth plans, and on an exit strategy from the business?

2. Thinking your systems are scalable for future growth

Remember when customer orders were taken on a piece of paper, with one copy handed to the kitchen and the other serving to identify the table of the order? Remember when you tracked staff hours in a spreadsheet? Or even a paper-and-pen notebook? Was there a time when you ordered stock over the phone, and recorded transactions in some kind of ledger?

If you are still running your business with practices like these, your business is simply not scalable, and you will not be prepared for the next level of success when your volume increases. You need to change your café business strategy to include a plan for scalability.

3. Thinking you have developed a loyal and cohesive team culture

Ask yourself these questions about the team culture in your workplace, and be honest with your answers:

  • Are team members as passionate about fulfilling the needs of your customers as you are?
  • Does each of them feel like they are part of a really worthwhile team?
  • Do your team members care about the business like you do?
  • How often do team members leave the company to find work elsewhere?
  • Do team members work together to achieve company business goals and objectives?

4. Thinking you need to do your own bookkeeping

Bookkeeping can be a very tedious, time-consuming task, and as manager of a thriving café business (or maybe several of them), your time can be better spent on higher-level activities and decision-making. Maybe in the very beginning, you spent five hours reconciling transactions on a Sunday night, or you spent a whole weekend recording invoices, but unless you have a tiny operation and loads of free time, low-level tasks like bookkeeping should be kept in the hands of a skilled and knowledgeable operator. You may want to consider our bookkeeping solutions to free up your time and save you money.

5. Thinking you should pay everyone else before yourself

Remember some of the reasons you started your own business? To be your own boss, to take a day off now and then, and to get paid on time? To a certain extent, being a business owner does involve sacrifice, and a responsibility to pay suppliers, staff, and investors; but if you’re getting paid last or not at all – what’s the point? You sit at the head of the table, and that means you should not have to settle for table scraps.

6. Thinking your cash flow is adequate for the demands of the business

You might think that your business is in pretty good shape, after you make all your payroll expenses, pay all your suppliers, and you’re even able to put some money in your own pocket.

Then you review the Quarterly Business Activity Statement from your financial adviser or your accountant, and your bottom line looks more like a sinking ship than a cruise liner.

Where did all the cash go? Your café business strategy needs to include a better review and control of all expenses, especially when they consistently exceed assets.

7. Thinking you have a plan that will help you achieve all your goals in life

Being a business owner and entrepreneur provides you with a great vehicle to achieve all your life goals. Having time to spend with your family, enjoying fantastic holidays, driving a nice car, and living in that house you always wanted.

But does your plan for the future include an exit strategy after you’ve achieved everything you set out to in business? Will it ensure that you are financially secure and well prepared to be comfortable in your life after business? If you don’t plan for that phase of your life, it probably won’t happen the way you want it to.

In our next post, we will explore the 7 action mistakes you are making in your café business which lead to significant problems.


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