IDEA: Private Coffee Shops

Marty Thomas,

A few months ago I read Arik Hanson’s post - 7 tips for working out of coffee shops.  I commented on Arik’s post…

Given the increasing popularity of coffee shop workers.. I have always thought it would be a good idea to create a “private” or “urban country club” type of coffee shop. Something in-between a public coffee shop (with no outlets), and a co-working space.

To which Arik Responded:

Great idea. Even if shops just offered a private room, I think that would be a big win (and I know some do).

As a work-at-homer myself, I find myself going to work at a coffee shop at least once a week to get some work done.  In Chicago, most coffee shops are packed with telecommuters.  Good luck getting a seat, let alone a power outlet! Receiving phone calls and using the bathroom also pose a problem.  Do I pack up my computer to leave my seat?  Ask the person next to me to watch it?  In other words, the current coffee shop environment is not ideal for telecommuters.

Another option for telecommuters that want to work outside of home is co-working spaces.  These spaces have become increasing popular over the last couple of years.  Here are some Chicago co-working spaces:

I gave this whole co-working thing a try.  My biggest problem with it… It feels like work!  It’s an office.  It’s exactly what I wanted to escape from. I also feel like I need to socialize with people in the work space, and it takes away from my work.  I know that a lot of people enjoy the co-working thing, but I have a feeling that I’m not alone here.

As I mentioned in my comment on Arik’s post, I think it would be ideal to have something in between a public coffee shop (like Starbucks), and a co-working space.  Call it a “private coffee shop.”  I’m not sure exactly how it would work.  Maybe a small monthly fee like a 24 hour fitness.  Or maybe members actually buy into equity like a private country club. However it would work, it would still feel like a coffee shop, but would be better suited for the telecommuters.

Recently, two “coffee shops” have opened with a business model very similar to what I’m proposing:

The fact that these companies are starting to pop up supports my hypothesis that there is a need in the marketplace for this type of business.

There is also plenty of room for growth in this market. A recent study - The State of Telework in the U.S.  found that more than 16 million people already work remotely at least once a month. Based on the historical growth rate reported by WorldatWork (roughly 12% per year), without any acceleration, that number will reach the theoretical maximum of 50 million people by 2018.

Finally.. I have a thought about how somebody could continue to prove the idea before actually jumping in.  Create a landing page for the idea, print out some business cards, and start handing them out at busy coffee shops.  See how much traction and emails the landing page gets.  If you get thousands of emails interested in the concept, we might have something worth pursuing.

So what do you think.  Good idea?

 

 

    • Robb Riggen

      I’d advocate for that – as by day I’m a Web programmer who telecommutes to most of my consulting gigs!

      We have coworking space here in the city near where I live. It’s a bit too much of a financial commitment. My style is more in line with a traditional coffee shop anyway.

    • http://www.adunate.com/ Di

      I would love this idea. I’m a graphic designer/copywriter and regularly work and meet with clients in coffee shops. I always try to pay my way and not be a laptop hobo, but I imagine there are many who do not. Offering a back room as a private coffee shop would ensure the owners of earning an income.

      Of course, the cost factor would be the determining thing. It must be enough that the coffee shop makes a living, yet affordable to the client.

      I wonder if offering an extra perk to subscribers of the private, backroom shop would encourage people to do so, rather than just taking their chances of getting a seat in the regular shop. Maybe 5-10% discount of food, or something. You know, like grocery co-ops do.

    • Martin Thomas

      Thanks Dj. I appreciate the feedback. I was leaning towards making the entire coffee house “private” or “membership only.”

      It would function similar to a 24 Hour Fitness, where members would have a key to enter the workspace after hours.

      I was thinking $100 amount to join, and $10 per month (or so).

      I love the idea of giving members an extra perk. Discount on food, drinks, or something other of value that would make it more enticing to join. Great ideas!

    • http://www.flyinghighcoffee.com/ Rob

      I’d advocate for that – as by day I’m a Web programmer who telecommutes to most of my consulting gigs!

      We have coworking space here in the city near where I live. It’s a bit too much of a financial commitment. My style is more in line with a traditional coffee shop anyway.

      And – fresh roasted coffee is always a bonus!

    • Tim

      Hi Martin,
      I think this could be tough venture. Typically one important goal of a coffee shop is to turnover as much traffic as possible. Even though customers might argue the benefits of sitting down and working on their laptop, they are taking up much needed space for other consumers willing to spend more money and will have larger tickets. I understand this concept is different in that maybe there is additional space for members, and they will be paying a monthly fee, but how many members can you stuff into this cafe? Lets say you get 100 members at $10/month, thats $1000 in revenue a month. Thats good, but a well ran cafe can generate $30,000 – $40,000/gross profit per month. Netting anywhere from $4500 – $8000 depending on your cost of goods sold, labor, and overhead. I view the $1,000 of membership revenue as something that may get in the way of potentially greater revenue streams.

      Please keep in mind that, anything is possible. I am not here to shoot you down, just trying to help. I know very little about “private coffee shops”, and I am sure there is more to this concept than what I’ve seen. Please feel free to contact me for any other information.

    • Mark McKee

      Good Afternoon Marty,

      I think it’s a unique business opportunity, especially when you hear the frustrations on coffee shop owners who do not have enough space for a business person to set up shop for half the day. Eventually, coffee shops will begin to change, will not allow people to use wi-fi or conduct daily work business in their shops, so do think this is a good alternative. I also work from home, so understand the need for interaction with people, that is a crucial element that many people do not realize. Hope the best with your plans, when you are ready for coffee and other items, let me know, would love to assist you.

    • Martin Thomas

      Hey Tim. Thanks for those numbers! So if we could sell the memberships for more around $40 – $50/mo range, the net revenue would fall much more closer to that of a well run “traditional” cafe.

      $50/mo is still considerably less than the typical $200/mo for a co-working space.

    • Martin Thomas

      Hi Mark. Ya, can you imagine if Starbucks ended up discontinuing WIFI service. That would be very good thing for the “private coffee house” model.

    • Caffe Sanora

      interesting concept Marty

    • Melani Cobb

      I really like this idea! One of the things that has always driven me nuts about Starbucks is the fact that if you plan to get any work done there the distractions are unreal. You pretty much nailed them all on your blog post. But the thought of going somewhere exclusive is really appealing. I look forward to seeing how this idea develops.
      I also like the “family game night” idea, as I am always looking for ways to include my kids in everything I do.

    • Tony DiCorpo

      if it is attached to a functioning coffee house it has to have it’s own identity. Be careful as it will become dependent on the regular coffee bar servicing the coffee house patrons. The entire place has to be built to accomodate that traffic. Remember the business is still a business and not a convenience for anyone. At the end of the day it has to profitable.

    • Gopu P

      Martin, when you make the shop private and payable for membership and access, you will have to restrict the number of possible guests. After charging members for access, you will have to ensure them space always. The mix of walk-in and paid guests will have to be well planned. A coffee shop like a gym where one gets exclusive access sounds nice, like a club where one can have privileges. like you and others listed, possibilities are enormous, one can get creative with it.

    • Anonymous

      I haven’t thought about this being attached to a functioning coffee house. I originally envisioned it as a completely separate entity, supported by a monthly membership. Coffee sales would be icing on the cake (or at least that would be the ideal situation).

    • Anonymous

      Determining the proper amount of members to allow is going to be something we will have to consider. My ideal plan would be to only allow paid members to use the space. The first store would defiantly be an experiment to see how many members actually use the coffee house. We can then use these numbers to determine how many members we can allow, so that we can ensure that the guests will have a seat. I’m not sure how much planning we can actually do here without just getting out and doing it!

    • Anonymous

      I created a quick “landing page” for the concept here: http://teleys.com

    • http://profile.yahoo.com/KNJ4ZTRX4NXZ7G6CECMOD5VCBQ Ken

      Hi Marty, I read your blog, I find the whole concept of a private coffee shop interesting, as a coffee shop reviewer I like it when I can go to any shop order coffee do my review and go about my business, and private coffee shop kinds of defeats my purpose as a reviewer, but if I was in the business as a teleworker, I can see where something like that would have a great appeal,of course I would be the talkative type, bouncing ideas around and discussing the weather. I have read your comments as well, and it seems you are off to a good start, you will be changing your ideas as the shop becomes a reality and you need to adapt to what is going on. Good Luck and thanks for asking my input.