How to Start Your Own Tea Cafe

Monday, June 24, 2013

How to Start Your Own Tea Cafe

You already know how good a warm cup of tea can taste. Perhaps you pride yourself on knowing many different blends and what tasty pastries they should accompany. With some ingenuity, hard work and capital, you can turn your love of tea into a thriving tea cafe business. Whether you decide to focus on the college crowd, business crowd or a combination of both, location, great products and impeccable customer service will be key to your success.

Step 1

Develop your business plan. A good business plan includes a mission statement, an analysis of the competition, and outlines for your current and projected finances, decor and target market as well as solutions for any potential obstacles. The business plan will be useful when seeking investors and approaching banks for loans and future expansion; therefore, it must be as professional and complete as possible.

Step 2

Comply with local, county and state legal regulations. Register your business license. Create a name for the cafe before applying for the license at city hall as the name must appear on the license. Visit local health departments and code inspectors to ensure that your business complies with health inspections, building permits and other required certificates. Apply for a tax identification number with the Internal Revenue Service.

Step 3

Learn about your competition. Knowing how they operate, the products they offer and how they utilize their spaces gives you the chance to do it better. Keep careful records of competitor's prices, teas and any issues you observe so you can build your business with high standards and excellent customer service.

Step 4

Use what you learn from the competition to target your niche customer base. If the nearby competition is doing a poor job, you can tailor your business to appeal to the same crowd, simply better. If there is significant competition for one market, such as college kids, but very little to attract the business crowd, you can target business people with your ambiance, tea house theme and tea choices.

Step 5

Find a location. Choose a storefront with windows so people walking by can appreciate the atmosphere your tea cafe provides. A busy street with plenty of parking is ideal. Avoid purchasing an existing tea cafe that is going out of business, as it will be difficult to overcome the poor reputation the previous occupants may have developed. Instead, choose an empty building or a going-out-of-business location that is not a tea cafe.

Step 6

Decorate the cafe. Ambiance is everything in tea cafes. Pattern the entire decor around a theme or eclectic pattern and install couches, chairs and stools that encourage relaxation and conversation. Individually placed lamps work better than bright overhead lighting. For plans to cater to the business crowd, a modern, quiet, theme works best so customers can meet at your tea house to conduct job interviews and business meetings. Alternatively, the college crowd will migrate to a tea house that provides upbeat music and a fun, playful theme.

Step 7

Rent or purchase necessary equipment, including linens, tea cups, silverware and pastry dishes. Renting allows you to change patterns at will with a phone call or email while purchasing reduces your monthly overhead because you own the pieces and do not have to pay a monthly rental fee.

Step 8

Accrue stock. Develop relationships with tea vendors and select 10 teas that will be offered on a daily basis. Limiting the stock can help build your clientele as too many choices can overwhelm a customer. Ten tea varieties provides options without being overwhelming. Also identify 80 to 100 tea blends that can be ordered as needed and use them to offer five daily specialty blends. Coordinate the specialty blends with seasons, holidays and other occasions. Also stock pastries and crackers that can be paired with the teas.

Step 9

Invent a signature tea blend. Invite friends and family members over to spend a day trying different blend combinations. When you find one that you feel represents your cafe, name it and make it the cafe's signature tea.

Step 10

Insure the shop. Insurance for the building, stock and liability are minimum cafe ownership requirements.

Step 11

Hire employees. Decide if you will have part-time or full-time workers and consequently place ads in local papers and online. Define in the ads what the job entails, what it pays and what, if any, experience you require of applicants to reduce the number of unqualified applicants. Part-time workers do not typically expect benefits while full-time workers often seek out positions that offer health insurance and annual paid vacations. Full-time employees are typically easier to schedule because there are fewer to juggle.

Step 12

Open the doors. A soft opening, which is a quiet opening without a lot of fanfare, allows you to test drive the cafe and its products before making a splash with a grand opening. Some businesses also have a VIP night, during which relatives of employees, area dignitaries and vendors are invited to spend the evening sampling products free-of-charge and providing feedback on the experience. The grand opening is typically planned for a few weeks after the soft opening and includes plenty of advertising. Grand openings are meant to announce the successful opening of your tea house. Ask a local radio station to broadcast from your location during the grand opening. You typically pay a fee for this service, but your tea house is advertised on the radio constantly for an entire shift.

Step 13

Market your tea house. Design a website that describes your business, includes a calendar of events and a photo album of fun events that occur. A social network site page gathers followers who will place your business's page on their pages, thereby reaching all of their contacts. Advertisements in local print media and on radio and television stations also reach potential customers depending on the chosen venue and ad spot timing.

Things Needed

Different teas
Building
Chairs
Tables
Signage

References (3)

About the Author

Candace Webb has been writing professionally since 1989. She has worked as a full-time journalist as well as contributed to metropolitan newspapers including the "Tennessean." She has also worked on staff as an associate editor at the "Nashville Parent" magazine. Webb holds a Bachelor of Arts in journalism with a minor in business from San Jose State University.

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Easy Tips and Ideas to Start Business

Although anyone can start a business, many people fail because of a bad product or improper research. If you want to start your own business, you can improve your chances for success before you even begin. In order to make your business successful, start strong and make sure that your idea will hold out for the long haul.

Have a Good Product

Ensure that you plan to sell something useful. Although you may think that your product is important or special, that doesn't mean the general public will agree. Ask friends, family and strangers what they think of your product. If they don't seem that interested, ask them why. With their suggestions, you can either improve the product or scrap the idea completely. According to Brad Sugars of Entrepreneur magazine, most small businesses fail because they sold a product that didn't have an adequate market. This also applies to small businesses that provide a service. A lawn-care business might be useful for part of the year in a northern state, but it is in-demand year-round in the south. Consider whether people will actually want to use your service and get constructive advice from those not afraid to give their opinion.

Research Local Businesses

Research local companies before starting up your own business. This will not only give you an idea of the amount of competition you will have, but it will also help you price your product or service. If you're looking to start a wedding photography business, you may find during your research that the market is over-saturated in your area. If not over-saturated, you should contact each business and ask them for a price list. Alter your prices so you can stay competitive with the competition in town. Researching similar local businesses will also help you decide where to locate your business location. Try not to start up a store or office close to another business of your type. If your small business is located away from similar business types, this will cause locals to choose you over businesses that are farther away from where they live.

Get Professional Advice

You may know someone who has started their own successful business. Ask him for advice and listen to his stories of how he started his company. You may gain useful advice on the good and bad ways to start a business. Local entrepreneurs can also introduce you to local product providers or advertisers that you may not have met without their help. Accept any advice with open arms, especially if the advice is coming from someone successful in the area.

How to Calculate Business Start Up Costs

Starting a business in no easy endeavor. It takes a great deal of research, perseverance and hard work. While sweat equity will make your small business more successful, you will most likely need real capital to get the business started. Before you start raising capital and/or investing your own funds, the first thing you need to do is determine the total start-up costs.

Step 1

Determine your costs of sales. For most small businesses this means inventory, the cost of raw materials, manufacturing equipment, shipping, packaging, and warehousing. However, not all businesses sell products. In this case, the cost of sales is primarily the direct labor involved in making the sale. For example, to open a small shoe business entails purchasing enough inventory ($10,000) to stock the store.

Step 2

Determine professional fees. Planning your business structure, i.e., limited liability corporation or general partnership, means hiring an attorney. There may also be the need to pay an attorney for help with establishing trademarks, copyrights, and patents. In this scenario, that puts total professional fees at an estimated $20,000.

Step 3

Determine technology costs. Technology can greatly reduce the cost of labor for small business if used effectively. Most small businesses require computers, printers, cell phones, website development, Internet access, software applications, information security, data storage, and outsourced information technology (IT) consulting. If the cost of technology is $10,000 to start, add an additional $5,000 a year for maintenance (hint: maintenance is not included in start-up costs).

Step 4

Determine administrative costs. This varies with business types and may include items such as business insurance, office supplies, product packaging, parking, rent, express shipping, desks, chairs, fax machines, phones, or anything else necessary to operate the business daily. A good estimate for start-up administrative costs would be $5,000 for the first six months.

Step 5

Determine initial sales and marketing costs. Now that you have your product, you need to let folks know about it. Sales and marketing costs generally include marketing materials for presentations, printing stationery, business cards, advertising, trade show events, and public relations. These initial sales and marketing costs can add up to $3,000.

Step 6

Determine the wages and benefits needed to secure a staff. This includes employee salaries, benefits, workers compensation, and payroll taxes. Let's put the cost of wages and benefits estimated at $20,000 for the first three months of business.

Step 7

Add all costs associated with starting the business for a total. Be sure to only include business start-up costs that will be incurred in the first three to six months of operations. For this example, the calculation is: $10,000 + $20,000 + $10,000 + $5,000 + $3,000 + $20,000 = $68,000.

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Monday, June 24, 2013