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How to open a coffee shop: one café owner's tips for success

For Coffeehood café owner Duncan Hong, the key to running a popular coffee shop in Sydney’s northern suburbs is to build a great connection with the community. More recently, he’s used Westpac’s tap-to-pay technology to help customers save time on their lunch hour or coffee break. Here are more of Duncan's tips for café owners' success.


Key take-outs
  • A great café setup starts with finding the right location and creating the right space
  • Good food service businesses evolve their offering around their customer base
  • Convenience is key – consider an easy customer payment solution like EFTPOS Air tap-to-pay app
  • Make sure you have a good relationship with your suppliers
  • Look after your staff as well as your customers
  • Start out with the right banking facilities

How Coffeehood became a popular cafe business

You may think that to have a successful café you would need a complicated business plan. But, sometimes, all it takes is an eye for an opportunity.

Duncan Hong already had some experience in the hospitality business – in 2010, he and his wife bought a franchised café business setup in Campsie, NSW.

"She wanted to stay busy when our three children were at school,” he explains. “But I didn’t have to worry about that café business too much, because we have a very good team working there.

"It was time to start another new business – opening up another café."

In 2017 Coffeehood opened its doors to the local Chatswood community and it has been a thriving local business ever since.

In this Business 101 checklist, Hong shares his own café tips and insights for establishing a successful coffee culture setup.

1. Choose the right location

What’s the best location for a successful café? Hong looked at several coffee shops for sale in the local community, but it was one in Chatswood that he thought had a lot of potential and good foot traffic.

It was only 200 metres from one of Sydney’s busiest stations, and close to office blocks and Chatswood Public School.

“There were lots of teachers and office workers looking for a place to have good coffee, or that served food that would not take too much time to prepare or eat,” he says.

Confident that he could turn the existing café into a thriving new business, he arranged a business loan.

2. Create an inviting space

The original interior was dated and dark, Hong says, and the café setup needed refitting..

A neutral colour scheme and stylish hanging lights added a happy vibe, and comfortable padded wooden chairs as well as banquette seating meant diners could relax during their pre-work coffee or lunch break.

More importantly, Hong introduced a display board of artwork from local students that resonated with his target market in the local area.

“My idea was to build a special relationship with the community,” he says. “As a migrant from China, I know how important that is.

“I also set up a small bookshelf. People are stuck on the phone too much, but everyone likes reading books.”

In a time-clocked lunch break, the chance to eat, drink and get lost in a story, if only for a short time, is something Hong was sure would increase happiness and clientele.

3. Put ‘customer focus’ on the menu

As a food service business Hong felt the menu shouldn’t be about what the café wants to supply, but about what customers need. “Because our clientele are mainly office workers and teachers, they don’t have much time,” he says.

“For that reason, we feature sandwiches, wraps and burgers and, with two staff in the kitchen and four on the floor, we serve food quickly."

"We also have salads, as well as vegetarian and gluten free options, and some special dishes, such as barramundi fish and chips."

“But the important thing is that customers don’t wait a long time.”

4. Remember everyone’s time matters

Recently Hong also introduced the new tap-to-pay app, Westpac EFTPOS Air, so it’s fast to pay via a mobile device, no hardware or card required.

“It’s just a great supplement to my business without any extra cost. EFTPOS Air is flexible and reliable, and I can use it as a second register when there's a long queue. Most importantly, there’s no fixed monthly fee, I pay only when I use it.”

It’s also convenient for coffee shop customers, he says. “So, they’re happy and I’m happy. And it only took me five minutes to set up.”

5. Quality ingredients count

Menu favourites at the successful café include the pulled chicken sandwich or wrap with poached chicken breast, smashed avocado, mixed leaf and walnuts with aioli, and the American beef burger with a wagyu beef patty, cheddar cheese, pickles, lettuce, tomato and onion rings and aioli and barbecue sauce.

Hong puts a lot of hard work into building relationships with suppliers who offer quality ingredients, and he will change suppliers if he’s not happy

6. Build relationships with new customers and staff

“Good coffee also keeps customers coming back – I employ a top barista,” says Hong who works consistently on customer service. “I always say hello, remember customers’ names, and try to make the relationship good.

“Of course, you can’t make everyone happy, but you do your best.”

Relationships with staff are crucial to a successful café too. Good pay is a given, says Hong, and together with respect generates loyalty.

7. Make sure your business plan includes the right bank

While he has an accountant and uses accounting software MYOB to do all his business finances, including payroll, Hong has not used other financial advice.

But he did change banks , to Westpac, because he preferred the technological solutions on offer. “The Westpac EFTPOS terminal can also be easily integrated with my POS software.”

The EFTPOS Air app is now used by about 30 per cent of Coffeehood customers and, because of same-day settlement, has benefited business cash flow.

“I use Simple mode to input the amount and I’ve only had to call Westpac’s 24/7 merchant support once, to reset my password.”

For Hong, being a successful café owner isn’t just about making money, though. It’s about customer recognition.

“When people tell me I am doing a fantastic job, that what makes me proud.”

Learn more about why customers and business owners love using Westpac EFTPOS Air.

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Things you should know

This information does not take into account your personal circumstances and is general. It is an overview only and should not be considered a comprehensive statement on any matter or relied upon. Consider obtaining personalised advice from a professional financial adviser and your accountant before making any financial decisions in relation to the matters discussed in this article, including when considering tax and finance options for your business. Westpac does not endorse any of the external providers referred to in this article.