August 17, 2020

Should You Open A Pop-Up Coffee Shop?

Opening a coffee shop can be expensive. Alongside buying stock and hiring staff, you also have to look for available premises, which is a major cost. However, if you’re looking for a way to cut down on your expenses – or even test a new idea or brand – you might consider opening a pop-up coffee shop.

To learn more about the process of opening a pop-up coffee shop, I spoke to pop-up owners and operators from around the world. Here’s what they said. 

Lee este artículo en español ¿Deberías Abrir Una Cafetería Móvil?

What Is A Pop-Up Coffee Shop? 

Yeekai Lim is the owner of pop-up coffee shop Cognoscenti Coffee in Los Angeles, USA. He says that a pop-up coffee shop is “a loose term for a temporary setup that is done under the radar” and describes it as “a guerilla approach to serving the public without conventional advertising and signage”.

To put it simply: a pop-up coffee shop is one that is opened in a temporary space, usually for a limited period of time. It doesn’t necessarily have to be a stall or a kiosk; it could be in a typical storefront, an unused gallery or event space, or even on a truck or bus that moves between locations.

Opening a pop-up coffee shop allows business owners to sell coffee without committing to costly overheads for a long period of time – business leases can often run for months or years. This allows them to test a market and scope out interest for their coffee.

While the pop-up shop concept is by no means new, it has gained popularity in the coffee sector over recent years. For example, last year, Bandit Coffee Co. made its debut in the USA, originally inspired by Chinese coffee chain Luckin Coffee.

Bandit offers franchisees a fully outfitted kiosk that can be assembled anywhere near a power outlet. As its startup costs are lower than that of a typical store, it can offer drinks at more competitive prices. It also allows customers to order through an app for ultimate flexibility.

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Flexibility And Covid-19

During the Covid-19 pandemic, a number of coffee shops have realised that the pop-up coffee shop is a flexible, viable alternative to a bricks-and-mortar store. As retailers across the world are closing their doors as a result of government regulations and lower demand, flexibility is quickly becoming a priority.

The pop-up model allows coffee shops to operate without incurring the full cost and commitment of having a permanent location in a difficult economic situation. Short-term leases will also allow property owners to recoup or cover some of their losses in a tough property market. Some pop-up coffee shops have even seen sales increase in recent weeks, winning market share from coffee shops who have closed their doors.

Leslee Cross has run PUCS Pop-up Coffee Stop with her husband in Houston, Texas, for the past five and a half years. She says that business has been “insanely busy”. PUCS is located in a residential area, and has seen more custom from people who work from home. 

Kevin Clark operates Vintage Coffee Midrand in Johannesburg, South Africa. He agrees with Leslee: “I wish I had known it would’ve been this good, then I would have done it sooner. We have seen growth even in the midst of Covid-19 lockdowns.”

The cost of opening a pop-up shop of any kind obviously varies from region to region. However, short-term space supplier Storefront said that clients opening a pop-up pay up to 80% less than they would for a traditional store. According to them, this leads to quicker growth and more sales. Kevin agrees, saying that the main advantages of his pop-up have been “smaller overheads and quicker growth”.

What Challenges Do Pop-Up Operators Face?

While some things are made simpler at a pop-up coffee shop, others are made more complex. For starters, the menu that you can offer will be limited, as you won’t have the space, facilities, staff, or time to churn out dozens of different orders. 

Carlos Cannon is the owner of Fuel Mobile Coffee Bar, which operates in Atlanta, Georgia, in the USA. He says Fuel [has] “a limited menu due to our small operational space and limited storage”. He adds that the shop is “completely mobile”, making it “unavailable to the people who’d like to drive up at any time and buy a latte”. 

Leslee also says that offering a pop-up coffee shop is completely different to operating a food truck in terms of demand. She says she mostly serves customers in the morning when people traditionally drink more coffee. A limited menu with fewer food options will mean customers are less likely to visit in the afternoon, when coffee consumption generally decreases.

The work involved in opening your pop-up – including obtaining the necessary permits and licenses – can also be time-consuming and costly. Carlos noted that “the process of fitting out the cart” as well as “getting the cart to pass inspection from the local health inspector” was challenging. Leslee says that it took her over a year to get her food truck fully outfitted and approved for use – and that her license has to be renewed annually.

Tips For Starting Your Own Pop-Up Coffee Shop 

Whether your shop is a pop-up or in a fixed location, product quality remains the most important thing. Leslee says: “When you’re serving a good product, people are dedicated to you and they’ll come every single day you’re open.”

Creating – and sticking to – a small list of popular drinks will also improve your success – as will adding food to your menu. Leslee has simplified matters in her pop-up by serving one blend for filter and another for espresso. She adds that without serving food, her shop would find it difficult to be profitable.

David recommends serving customers “things that are easy to grab and go. Food that is quickly assembled and can be eaten with one hand.” Messy food or food that requires cutlery aren’t as appealing, especially when most customers associate a pop-up with convenience.

Make sure you invest in your social media presence. Good-quality social media content will encourage more people to visit your pop-up. Furthermore, if you change locations, this will be the easiest way to make customers aware of where you’re moving to.

Leslee says: “Around 85% of our business comes from repeat customers; our retention rate is extremely high. We’ve had people move away and come to see us specifically when they come back to town.

“Without being a bricks-and-mortar shop, you have to create a community… somewhere people can gather and have a connection,” Leslee says.

Pop-up coffee shops offer business owners a flexible and cost-effective way to reach customers without committing to a long-term lease. For budding entrepreneurs, it’s a great way to ride out the early stages of your operation while keeping your costs low. 

However, despite the advantages of the pop-up model, it shouldn’t be viewed as an easy alternative, nor one that guarantees success. As with any coffee shop, a pop-up needs quality coffee, well-trained staff, and plenty of planning in order to be successful.

Enjoyed this? Then read Café Careers: How To Launch Your Own Specialty Coffee Shop

Photo credits: Neil Soque, Untamed Creative Society, Fuel Coffee Bar 

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