BeanScene speaks to café owners who have ridden the wave of 2020 and come out on the other side with a renewed focus and plans to grow their business even further.
When COVID-19 forced the closure of many small hospitality businesses, coffee shops went into a fight or flight response. Some had to halt dine-in operations and wait for the storm to pass, while others found means to stay open, stay afloat and stay in business.
For Looloo Forsyth, those decisions were tough, but necessary. When restrictions hit and governments forced people to work from home, Looloo had to look at the operational structure of her two café, Loo Loos Coffee Warehouse, and Loo Loos Coffee Shack in Kimcumber, New South Wales.
“We had to make some tough decision from a staffing point of view. It was stressful and emotionally challenging. We didn’t qualify to receive JobKeeper subsidies because our combined businesses were down by 28 to 29 per cent, not the 30 per cent required,” Looloo says. “Each week we lived with uncertainty and had to review our structure and costs to ensure we remained a viable business. We went from having five staff one week to four the next, until there was just one. These decisions were the hardest because they did impact people’s lives, but it was that or shut our doors like so many of our neighbours did.”
Thankfully, Loo Loos Coffee never had to. Instead, Looloo reduced its labour costs, then its food supplies. She removed menu items such as the smashed avo, milkshakes and butter and jam on toast, but kept its signature vegetarian ham and cheese toasties and food offerings that involved no preparation, such as standard friands, frittatas, and wraps.
“We really paired back our food offering and mirrored that with pure takeaway service. All of a sudden more people were working from home and relocating to their holiday houses. Sales at our beachside venue went up by 40 per cent, causing another staffing headache because off a sudden one person running the shop wasn’t enough,” Looloo says.
“People management has been one of the hardest things to deal with. It was tough initially with everything slowing down, but then it was just as hard figuring it out on the way back up. We had to look at how busy we were getting, whether it justified another person in wages, and when we could, we managed shifts evenly and fairly. Through it all, it was interesting how people responded under pressure.”
What was also surprising was the high volume sales of one-kilogram bags of whole bean that flew out the door as a result of panic buying and more people wanting to enjoy their coffee at home.
At the café, Looloo also increased its digital management systems to better manage staff and shop operations, with the introduction of Deputy payroll integration and Kounta Lightspeed point of sale system.
“The pandemic really enabled me to look at the business with completely fresh eyes. We completely changed our programs to be more digitally focused and it’s saved us time and money,” she says.
A year on from the initial impact, Looloo has retained her café’s espresso service and is happy to have a business with its doors still open, and one that’s “really healthy”.
“It’s taken a while for customers to transition to our new style, maybe we’ve lost a little bit of business because we don’t do table service, but now the business is completely sustainable. Staff costs have gone from 36 per cent to 25 per cent, but it’s that extra 10 per cent that saved us and made the business viable,” she says.
Alex Williams of Dachshund Coffee in Hunters Hill, New South Wales, is another business that used 2020 as an opportunity for growth. When Alex’s international travel were plans put on hold, he and twin brother Matthew were forced to pivot when restrictions were enforced. The footprint of the business meant they could descale to a takeaway-only model quite quickly, including its plant-based food menu which they choose to keep due to their belief in food that nourishes the body and boosts immunity.
“While we did experience a downturn in our food and overall revenue because we scaled back our operations, we had a loyal following which meant we could still operate throughout that March to April period,” Alex says. “What was a little unforeseen, however, was our revenue returning to normal if not a bit better after that. People who would normally go to work Monday to Friday were keeping their coffee ritual but in a different area, so we started experiencing the traffic city cafés would normally see in terms of volume.”
Alex says the increase in volume has remained, a reflection of where the local market is at, people continuing to work from home, and the fact that day to day habits don’t have to change despite the change in working location.
“What our customers ended up doing is participating in the community they live in and visiting us sometimes multiple times a day to reflect the habits they displayed in the office. We increased our sales, particularly in takeaway coffee, and grab-and-go items. Even UberEats has been a noticeable revenue stream that’s increased over the last 12 months, again representative of more people seeking out produce and venues closer to home,” Alex says.
COVID-19 forced Alex and Matthew to think outside the box, but it also allowed them to re-evaluate parts of their business that would have otherwise been on hold. This included integrating me&u order and pay digital system to limit staff touchpoints with consumers, which has remained and continues to act as a point of difference in the competitive suburb.
“Since introducing the me&u system we have increased our productivity. We have more time to interact and talk with our customers and focus on them rather than taking up valuable time with payment chat,” Alex says.
To help cope with the increase in business, Alex says his relationship with roaster Espressology and its roaster has been integral in taking the pressure off and allowing him to focus on what he does best.
“Sasha has been amazing and uses the Espressology facilities to create our blend using beans from Brazil and Ethiopia, which she has done for more than seven years now,” Alex says. “We get a lot of compliments on our coffee and that’s a representation of our style and quality across the board.”
Alex is hopeful his coffee and food philosophy will soon transcend into Dachshund’s second venue later in the year.
“We’re moving ahead. My brother and I were young, highly ambitious, naive 20-year-olds with the energy required to run a business, but our expansion has taken a bit longer than we thought. One of the influencing factors of doing this project has actually been COVID and the inability to travel. We figured if we were going to be here, let’s invest the time and energy to do something we want to do, so our second store is a by-product of COVID and we’re just grateful to be in a position to do it,” Alex says.
“It will be the third time I’ve started a business from scratch. There’s a lot of enjoyment in starting a new project, and I’m excited to expand the evolution of what we’ve done with Dachshund.”
While Dachshund is an example of success in what was a challenging year for many in hospitality, Alex says one of the most rewarding things to come out of the year was that they could act as a pillar of support for the community.
“Last year proved people’s desire and need for human connection in places like coffee shops is so important. We were fortunate we could be a conduit for people living alone or in small places to come and spend time. It was a saving grace for them, but it was also really humbling for everyone in the business,” Alex says.
“The restrictions have shone a light on how significant it is to simply enjoy a cup of coffee or spend time with family and friends. Some businesses in commercial areas are still suffering but a lot are now doing well because people are going out and making meaningful experiences with good food and coffee.”
For more information on how Espressology can assist your business growth, visit espressology.com
This article appears in the April 2021 edition of BeanScene. Subscribe HERE.