10 Essentials in Starting & Successfully Operating a
Specialty Coffee Businessby Bruce Milletto Coffee
Coffee Schools & Consulting:
So, you want to start a specialty coffee
going to spend an enormous amount of money and you’ll need
to protect that investment by being as well-educated as possible
about every aspect of the business. You will want to learn how
to be the best barista in order to serve a high-quality product
and you will want to get a business education specific to specialty
coffee. You’ve decided that going to coffee school or hiring
a consultant will help you to achieve these goals.
Below Bruce Milletto,
President of Bellissimo
Coffee InfoGroup tells you what to look for
when shopping for a coffee school or consultant.
I was recently surfing the web checking out the competition
in coffee education and consulting. I wasn't surprised to see
there were a number of individuals and companies now offering
consulting services and opening coffee schools. Certainly,
America is all about competition, and this industry is
enough to support multiple sources of information and assistance.
After all, successful coffee businesses fuel the growth
of our industry. Truthfully, what concerns me is not the fact
that these other sources might be taking some business
from my company, but rather that consumers may make uneducated
decisions about where to get good information... information
that will be essential to their success and the continued
success of this industry.
A Serious Business
Going into business can be very risky. The average failure
rate for any type of new business is about 80 percent.
for restaurants are typically around 95 percent. And, while
no specific statistics exist for the failure rate of coffee
we must assume that they fall somewhere between 80 and 95 percent.
Clearly, many of these failures are the direct result of owners
who have made poor decisions in setting up the business or
do not possess the skills to build and run their business.
who have prior business ownership experience and/or "bottom
line" foodservice management experience will certainly
have a better chance of being successful than those who do
with this industry changing and becoming more competitive each
day, the types of mistakes that were made by budding entrepreneurs
five years ago (and were survivable), often result in business
failure in today's marketplace. Good information is essential
to survival and success in this business.
The decision to embark on the journey to open your own coffee
business is a serious one. If you are considering attending a
coffee school or establishing a consulting relationship, and
the principals or their associates are not forthright about the
risks, or do not ask questions about your business experience,
or financial resources to start the business, you should be concerned.
If they just happen to be able to sell you an espresso machine
or coffee, you should be doubly concerned!
The truth is, that for those who are already in the business,
most would probably tell you that foodservice is a "love/hate
relationship." Owning a coffee operation can be fun and
rewarding, but it can also be overwhelming. While having great
product, good customer service, and a clean store are the fundamentals
essential to attract and maintain customers, it is only a small
fraction of what it takes to set up and operate a successful
coffee business. Creating a realistic financial plan, sourcing
the capital, finding a great location, negotiating an advantageous
lease, developing an efficient space design, selecting the right
equipment and consumable products, hiring good employees and
training them thoroughly, ordering product, controlling cost
of goods, controlling labor, producing monthly income statements,
setting goals and budgets, marketing your business, etc., etc.,
etc. — all need to be mastered to be successful in this
business. (I might mention that all of these subjects are talked
about in detail at our school – ABC’s.)
It is for this reason that I warn the buyer to beware when
they are making selections for professional help and education.
within this industry can show you how to pull a good shot of
espresso, steam velvety milk, and pour a heart on your latte.
And, if your only goal is to make a superior latte for your
friends at home, or to sharpen your barista skills at your
of employment, then most will probably meet your needs. But
don't be under any illusion that beautiful drinks are all it
to be successful in this business.
A Case in Point
Several months ago we signed a client who needed assistance
with an espresso bar design. When we asked about his budget
and the build out, he provided us with a figure, which was
woefully short of what we knew it would probably cost. When
him of this fact, he told us that the business investment figure
had been provided to him as a result of financial plan that
was prepared for him by a consulting company. Upon examination
this financial plan, we realized that it was merely a shopping
list of equipment and consumable products that the consultant’s
company sold. It made no provisions for such things as prepaid
rents and deposits, architectural, accounting and legal services,
essential equipment and mill work (sinks, refrigerators, ice
makers, cabinets, etc.), contractors services (general, plumbers,
electricians, framers, sheet rockers, painters, etc.), inventory
and small wares (except the things they stocked), and probably
most important of all — operating capital! The amount
quoted as the necessary funds to open and run the business
about 15 percent of what would actually be needed!
In my opinion, people who represent themselves as knowledgeable
consultants in this industry, and then provide poor information
because they are unqualified, are not only negligent, but border
on being unethical as well. After all, we are talking about
people's life savings in many cases perhaps their home, which
mortgaged to start the business, or their 401(k) retirement
fund, or their kid's college education money.
When Bellissimo began business 15 years ago with the creation
of award-winning educational videos, books and consulting services,
it was not only because there was a need for education and
assistance within the industry, and a business opportunity, but
we knew that collectively, we possessed the skills and experience
to do those things well. I had experience in film making, successful
retail business ownership, and importing Italian products,
specifically coffee. Ed Arvidson, senior coffee consultant for
came with 20 years of foodservice management and ownership
experience, including training managers and troubleshooting operations
major corporations. We knew we possessed the skills necessary
to fill the needs of many. But more importantly, we also knew
our limitations. If an individual would call our office and
ask us to help with a function that fell outside our realm of
we would try to refer them to someone who was qualified and
Since its inception, Bellissimo has expanded its staff slowly
and carefully. Kris Larson, Matt Milletto and Jared Mockli have
all brought their talents, and experience to help create what
I believe is the strongest, and most qualified consulting and
educational team within our industry. Perhaps more important
than their talents and experience is their passion and integrity.
We've gained our experience about coffee and espresso over
many years, by learning from some of the "industry's best" (like
Dr. Ernesto Illy — Illy Caffe and Mauro Cipolla — Caffe D'Arte
Coffee, to name a couple). We've also learned about the business
and this industry by helping literally hundreds of companies
and individuals open their businesses, and by helping many
others address their business challenges. It is from this base
and experiences that we have created the industry endorsed
standards in DVD and textbook training and education. Some
in this industry buy our tools to help educate their clients,
and to them, I say thank you. Your dedication to education,
as well as your patronage is greatly appreciated. There are
who will try to discourage you from buying any educational
materials, unless they come from them — Beware! No one
has a monopoly on knowledge. Our office bookshelves are stocked
from the industries best and brightest.
It is from this wealth of knowledge and experience that we
have built our coffee school: The
American Barista & Coffee
School in Portland, Oregon. If you are going into this business,
educated. If you have no experience, and it's within your budget,
consider some consulting help. However, do your homework before
you make a decision on what school to attend, or which consulting
firm to hire.
Ask the following questions:
How long have they been in the industry? Are they willing to
give you references? What is their experience? What is their
reputation (within the industry, and with their past attendees/clients)?
Do they have actual experience in creating and running successful
coffee operations? Who are they affiliated with in the industry?
What kind of facilities does their school possess? Do they
have equipment and products from more than one supplier (the
Barista & Coffee School has over 60 sponsors!)? For most
people the stakes are too high to make the wrong decision.
Milletto is the President of Bellissimo
Coffee InfoGroup and Founder of the American
Barista & Coffee School.