How taking risks in your café business can lead to financial freedom
I’m sure most of you have heard of (if not read) Robert Kiyosaki’s Rich Dad, Poor Dad, one of the most famous personal finance books of all time. (For those of you who haven’t, it’s the story of what two fathers in Robert’s life—his own and his best friend’s—taught him about money and investing.)
Well, around 15 years ago one of my friends and I went to one of Robert’s talks. And I can honestly say it put me on the path to financial freedom. By the time it was over I was determined to be my own boss and become financially stable by investing and building businesses.
Yes, I’d be taking a risk. But having heard Robert’s story, it seemed like a risk worth taking.
Unfortunately, it didn’t have the same inspirational effect on my friend. He was content to keep taking jobs, working hard for his bosses, and putting money away for the future when he could.
As I said, that was 15 years ago. Since then I’ve started three businesses, employed team members around the globe, invested both locally and internationally, and bought and sold several properties.
And my friend? Well, he’s still working for ‘the man’ and living in a rental. And the only investments he has are his bank accounts.
A risk worth taking
It might sound like I’m telling this story so I can gloat about my success. But I’m sharing it so you can see how taking risks can be a great thing.
Of course, having taken that first step to becoming a café entrepreneur means you may already know taking risks can lead to greater rewards. But you may be hesitating a little as the fears and doubts start to creep in. Fear of cash flow shortages. Fear of losing a key team member. Fear of losing money on invested in your cafe business.
Believe me, you’re not alone. Every entrepreneur struggles with doubt, including me. In fact, it’s practically a rite of passage.
And I’m not going to say anything like, “Take it easy. There’s nothing to worry about”. It won’t be easy. There will be things to worry about. Your path to financial freedom will be full of obstacles.
But you can get past them. You just need to embrace that fear, get comfortable with being uncomfortable, and strap yourself in for in incredible journey of investing and growing your wealth.
And at the end of your journey you’ll be able to retire early, and reap the rewards of all your hard work.
But in the meantime, just sit back and enjoy the ride. And if you need directions, don’t hesitate to get in touch with us.
Learn the steps to becoming a successful cafe entrepreneur
Some café entrepreneurs seem to have total clarity about their lives. They’re confident, happy, healthy, successful and financially stable. They’re the rock stars of the café industry.
People want to be around them. Work for them. Listen to them. Even be them.
And you know what? There’s no reason why you can’t be one of those entrepreneurs.
Of course, before you can achieve that ‘rock star’ status, you need to turn your café business into a café business that’s successful and financially stable. But how do you do that?
The answers are coming…
In our final blog for 2016 we told you about a couple of books we were working on. The books, which will be published later this year, will show you how to create financial freedom for yourself through your café.
You’ll learn the three stages you need to go through, and the process you need to follow, to be a successful café entrepreneur. Step by step, we’ll show you how you can use your café business to create wealth, make investments, and retire early.
Make no mistake. Running a café business is tough, not to mention time consuming. But it can also be very rewarding. A café business is all about people, and as an entrepreneur you’ll be at the centre of it all.
… and so are the rewards
Once you’ve achieved financial freedom from your cafe business, your life will never be the same again. You’ll always have time to do the things you want, when you want, and with whoever you want to do them with.
Here at Equus Partners we’re extremely goal driven. And when it comes to you, the café entrepreneur, our goal is to help you understand enough about the concepts for you to be able to make the decisions that will move you closer to being financially free.
So keep reading our blog (you can subscribe here) as we continue to share advice from our books that will help you achieve financial freedom.
And get ready to live that rock star lifestyle.
Make your dream of owning a successful cafe business a reality
Close your eyes for a moment, and imagine your life as a café owner in a year’s time. What do you see?
(Well, nothing obviously. Your eyes are closed. But forget that, and let your imagination run wild.)
If business is going well, you may picture yourself as a café entrepreneur. Your investment is running smoothly and efficiently. Every table is full, and people are lining up around the corner to grab a meal, a snack, or maybe just a coffee. And on the wall in your office are your plans and innovations to expand and grow your business even more.
But if your business isn’t doing so well, you may be imagining quite a different scenario. Maybe you’re struggling to keep the doors open, and facing the prospect of losing it all—your business, your pride, and maybe even your house.
Even if your café is doing okay, you may think that first scenario is nothing more than a fantasy. But with the right information and solid planning, you can make it your reality.
The seven P’s of a successful café
Like any business, the aim of owning a cafe is to make a bigger profit, have more cash, and to maximise your return on your investment.
But how do you turn a cafe business into a successful and financially stable cafe business?
We’ve identified seven key business areas you need to get just right to be successful. (We like to think of them as the seven P’s of a successful cafe.) And over the next few months we’re going to share them with you in our blog.
These special blog posts will show you how to make more profit, have more cash, and increase the value of your investment.
You’ve read the blog. Now read the book.
We’re also working on a book to help you make those dreams of becoming a successful café entrepreneur a reality.
By reading Count More Beans – The 7-Step Guide to Making More Profit, Having More Cash and Maximizing the Value of Your Café, you’ll learn the entrepreneurial strategies involved in making your café business a success.
All you’ll need to do is follow our step-by-step guide, keep an open mind, stay motivated, and forget everything you think you know about accountants.
Ready to make your café fantasy a reality? Then keep reading our blog, and stay tuned for an announcement about the book.
Of course, if there’s anything you’d like to talk about in the meantime, don’t hesitate to get in touch with us.
Why you can never stop innovating in your cafe business
As a cafe entrepreneur, what would you do if another cafe with an established reputation opened up across the road?
Would you ramp up your marketing? Lower your price? Or just keep doing what you’ve always been doing.
Here’s the story of what one café owner did. Unfortunately, this story doesn’t have a happy ending.
One man and his café
Sam opened his cafe in a busy inner city suburb of Melbourne. Like many café entrepreneurs, he started it from scratch. And he invested a lot time and money in growing his business.
Sam’s idea of a successful business was one that made enough money for him to pay the bills on time. And he had a simple idea for developing his café business: He’d open the doors each morning, people would come in and buy his coffee, and then those people would recommend him and his café to their friends.
Sounds reasonable, right? But rather than having a plan for future growth and expansion, Sam was happy to just let his business grow naturally and gradually.
And then the competition moved in
One morning, as Sam was writing up the specials board, he noticed a permit going up on the vacant land across the road.
He immediately felt sick to his stomach.
Within a month, there was another coffee shop across the road. But while they may have been new in the area, they were a well-known and established market leader. It wasn’t long before Sam had to contend with not only the new coffee shop, but also its large Instagram following and the smell of freshly roasted coffee beans.
For Sam’s business, it was like getting smacked in the face with a snowball.
His customers were soon heading across the road to see what all the hype was about. And they weren’t coming back.
Sam was already fighting a losing battle with cash flow, which crippled any chance of getting aggressive. And so his profits, which weren’t that big to begin with, quickly became losses.
Unable to make a move against his competition, Sam had little choice but to sell his café business and make a loss on his investment.
What Sam could have done differently
So what went wrong? Quite simply, Sam’s business wasn’t doing enough to survive long term.
Successful café entrepreneurs are always innovating—something Sam wasn’t doing. The amount of research and development café owners do is amazing, and unless you’re consistently evolving your products you’ll quickly be left behind.
One such innovation is for cafés to roast their own coffee beans. But Sam wasn’t doing that, and that’s one of the differences that gave Sam’s new neighbours the edge.
Successful cafes also have a loyal tribe—a group of dedicated people who share a common value. They’re not followers, but rather protectors who will work with and around it. And it’s this tribe that helps a café expand and conquer.
Sam’s business could have survived if he had the right tools, such as the finances to grow his café business. But having survived the first year, Sam probably thought his business was immune to running out of money. Unfortunately, innovating and growing a business takes a vault of capital and constant cash flow.
The moral of the story
In our story, there was no David and Goliath battle because the new café had won the moment it showed up.
You will always have businesses competing with yours. Businesses that are finding new ways to market themselves and steal your customers. Businesses that are developing products to make yours look like yesterday’s leftovers. Businesses that are different, and telling everyone why they’re better.
So never be complacent about your café business. Always be thinking of ways you can make it better for your customers. Because in the end they will become your loyal tribe, and help protect your business both now and into the future.
If you’ll be in the city for the Melbourne International Coffee Expo (MICE), come and say hi as I will be speaking at the Australian Speciality Coffee Association (ASCA) on Monday the 27th of March. It would be great to see you there.
ASCA Symposium – March 27
Are you a café entrepreneur looking to improve your cafe business?
Well then be sure to attend the first Symposium run by the Australian Specialty Coffee Association (ASCA).
This Symposium will cover important topics including how to attract positive attention for your business, simple steps to increase profitability and how to better support coffee producers with your café.
Speakers include, Matt Holden, Robert Mackay, Jos Webber, Stephen Bannister and Nadi Elias and will be chaired by BeanScene editor Sarah Baker.
Be sure to attend, to gain some important tips and advice for your cafe business.
Tickets on sale now.