It’s obvious Tonic is going to take a while to generate a profit so I need to find other sources of income. Due to all the time that Tonic is taking up right now, this new income has to be fairly passive. So I’ve started looking for ideas such as in property, and attended entrepreneurial conferences to continue getting ideas and inspiration. Then it recently hit me. I started getting some good leads, with involvement in property, bridging finance, even providing letters of credit for oil trading. I was going to invest my own money. However this could also be an opportunity to build the other business I wanted to build – a private investment company. I know so many people who have cash sitting in their accounts earning very little interest when it could be doing so much more. On the other side there are people with business ideas that need cash to make it happen, either for short or long term. This way, we could also all diversify our investments by putting small amounts into a range of investment opportunities. So I have started actively looking into some of these. Clearly they can be high-risk so I need to find those with good returns but where the downside is limited. Everyone will be relying on me having done my research and due diligence. Plus I really enjoy this – I really enjoy meeting people, discussing ideas, learning about new things going on in the markets, then doing my own research. Some ideas are starting to come together and I am going to to some small test investments to make sure that they are sound.
In the meantime sales at Tonic are increasing but still way short of what we need. We’re now working on new ways to market the hot drinks, maybe create more hot drinks for the menu using the natural ingredients, like hot spiced apple. We are also looking into the coffee idea and I’m having loads of fun looking into espresso machines. I do love my coffee...maybe I should have opened a coffee bar. I really want to get a small Baby Gaggia for the home but think the wife will leave me. Our kitchen is so small that we bump into each other if we’re both in it at the same time. Will save that one till we have a bigger place!
Tuesday, December 16, 2008
Saturday, November 15, 2008
finally launched
So we finally launched on August 15th and this is the first opportunity I’ve had to update this blog, which should tell you just how frantic it has been. Let me start at the beginning (and be warned, this is 3 months of update…it’s a long one!)
4 years studying Law and I still didn’t insist on a proper contract!!
The last time I wrote, I was getting extremely impatient with the shop fit out process. our shopfitters, proved to be extremely unreliable. Nick, the owner of the shopfitting company, had promised me that the works would be completed within 4 weeks of signing the contract with TFL, so in theory it should all have been completed by late June. As it turned out, despite the fact that we had agreed and signed off all the designs and plans back in April, and that I had paid deposits, Nick did not contract out the actual bar build until much later. As a result, the bar itself was not completed until late July!! To make matters worse, they kept saying that the internal works in the shop would only take a week, and therefore they did nothing until August when the bar was actually ready to go in. Then, when they began the internal works, they ran into all sorts of problems causing even more delays. In short, the entire project was poorly managed by them, and they took on multiple projects which all had to be delivered at the same time, and in his own words “the wheels came off!” Two other juice bars had exactly the same delays that I experienced at the same time, showing very clearly that these guys didn’t know what they were doing. Even once the bar was “completed”, there were quite a few things which still hadn’t been completed or done properly including some plumbing works. Some final things still haven’t been completed and probably never will! And after all of that, they had the audacity to demand more money for the work (almost 30% extra). The delays they caused meant we didn’t open the bar until the end of summer, which we were relying on to build up our customer base before we go into the colder months. Needless to say, we are disputing their claim for a higher amount, and I’m so annoyed about it that I’m happy to take them to court over it if it comes to that.
The marketing campaigns kick off
Meanwhile, back in the juice bar, we launched on a sunny day, and from day 1 we had lots of people come in first thing in the morning. They’d all seen the sign up and were eager for us to open. Of course, despite all the training, we were terrible at keeping up with orders and our service was a bit slow, causing many potential customers to walk away from the line. After a couple of weeks though, we found our rhythm, and got much more faster and smoother at taking and executing the orders, and business started picking up. We did lots of local marketing, with our leaflets, sampling the smoothies outside the shop and corporate days for local companies offering 50% discounts. We built good relationships with our customers and lots of them became regulars.
Sales started at around £200 per day, and slowly increased. We introduced fantastic snacks such as health bars, which sold well. We tried sandwiches, but found that it didn’t really work. We were selling organic sandwiches from “Fresh! Naturally Organic”. However we found that since we are surrounded by food outlets (Pret, Eat, etc), we were only selling a handful a day. We originally thought it might encourage people to buy a smoothie with their sandwich, but we found that those buying sandwiches rarely bought a smoothie with it, probably as the combined cost was too high. We couldn’t sell cheap sandwiches as it doesn’t go with our brand, and there is a ‘treats’ in the station, so if someone wants cheap sandwiches they go there. Since our minimum order on sandwiches was about £50, and we only sold a few, we were losing money EVERY day. Finally, after a few weeks, we scrapped it, and moved the £1,000 display fridge we’d bought into a warehouse. So the whole experiment ended up costing us around £2k, but we had to try it!
When do we reach breakeven?
In the meantime, total sales were increasing, and we were regularly hitting £350/day. This was driven by smoothies. We wanted people to understand that for every day purposes, maximum nutrition comes from juices, especially our super-juices that contain vegetables. Nonetheless smoothies made up two-thirds of our sales particularly as the breakfast smoothies were gaining popularity, indicating that people were using it as a meal replacement. We started selling more of our ‘breakfast anytime’ smoothies, with oats or granola-top. Sales gradually started climbing towards £400/day.
Now all this time, bear in mind that our basic breakeven figure stands at around £800/day give or take. Juices and smoothies have low margins due to the high product costs, so the gross margin (ie. sales price – fruit, cups, lid, straw and VAT) is around 55%. The margins on hot drinks, like the teas, are higher at around 70%, but we sold very few of these. Given the level of rent and rates, staff costs, overheads, etc. We had to sell around 250 drinks per day to break even, and we were hitting around 120-150.
Also, it’s worth noting that we are a ‘natural tonic bar’ situated bang-slap in the middle of an extremely dense office area, with around 40,000 potential customers, half of whom use the station, and around a quarter of which pass the shop on a regular basis. Nevertheless, we found that despite all our marketing efforts, people just didn’t know we were there. People would stop in the shop two months after launch and be shocked when we told them how long we’d been open. As with most office workers, they walked past each morning and evening in a zombied state and never noticed us, despite all the bright colours and sampling outside the shop. Needless to say therefore, many of those workers that used other exits from the station had never heard of us. We kicked off marketing campaigns targeting offices in the local area, offering 50% discounts, which did create more awareness, but the campaign was limited by the amount of time I had to devote to it, given all the other hats I was wearing. I had to call up each company and arrange for someone to distribute vouchers internally (we’d already done the external flyering so thought this was a better approach) But all this took time.
Technology…why does it never work?
At this point, I was still grappling with the EPOS and website systems. The company that I had hired to do the EPOS and website development over-promised and grossly under-delivered. They had outsourced the development to a team in India, and I found myself on the phone to them every morning for about two months to get the EPOS and website up and running. The whole system was supposed to be integrated, for electronic loyalty cards, web-ordering, etc. As it turned out, it was a complete mess, nothing worked and we ended up going back to basics. But even then, as a standalone EPOS system, they couldn’t make simple things work, like the cash-drawer opening, or end-of-day reports. We’re still working through these problems. This was all a classic mistake of mine, I expected quite a lot, on a small budget, from a company that ‘said’ they could do everything, but could not give me concrete examples. Since it was a new concept, I accepted it, but in retrospect given the amount of time I have had to put into it I should have gone with a simpler system and with another company altogether.
At the same time, I was also working on all the marketing aspects of the business. As I said earlier I was doing all the local marketing, calling up companies and teaming up to do promotions, going out flyering and getting teams of people to flyer, doing specific corporate days for big local companies (TFL, Scotland Yard, etc). At the same time, I was trying to do basic bookkeeping so that I could get a grip on our incomings and outgoings. Even though we have an accountant, on a day to day basis I find it’s easier doing it myself. On top of all this, I was looking into every other aspect of the business, suppliers, products, even furniture all the way through to recycling bags, and small things like poster holders. All in all, I was getting very quickly swamped.
I just need a break…
So, I did what every entrepreneur does when faced with this, I took a holiday!! Now I know this sounds a bit crazy, but to be honest it wouldn’t have changed much. But given how busy the last six months had been, I’d promised Meenal (the missus for those not keeping up) that we’d take a holiday after the business was stabilised. Even though it was far from stabilised, I thought that we were running into a problem of being so deeply sucked into the business that I was losing sight of broader business objectives. I thought the two week break would do me some good too. So we went off to Tanzania on an amazing holiday.
Of course, as soon as I went, business fell off a cliff!! To be fair to everyone involved, it wasn’t because I wasn’t here – I’m not that important to the business. I have more than capable staff, and we had put everything in place, and got all the supplies we needed before I left. No, it was the first spell of really cold weather. Just as our sales were averaging £400/day, the cold weather causes sales to fall down to £250. Smoothies are cold, and seen as summer drinks by many, so the only customers that continued coming were those that bought breakfast smoothies, ie. as breakfast replacements; or those that appreciate that juices, especially super juices, are in fact quite warming and exactly what you need going into winter to build up the old immune system.
Reality sets in
At this stage the staff were getting pretty depressed about the situation. My most senior staff, Emanuele and Martina had both been away a few weeks earlier and come back energised and rejuvenated, but both were feeling pretty down about this. I guess in some way they also felt responsible since I was away and it happened on their watch. But to be hinest it couldn’t be helped. We hadn’t established the business enough for customers to shift to the winter drinks, the warming juices, the hot teas and herbal infusions, etc.
When I did get back, we were obviously in a bit of a panic, and had to focus very had on costs. For one thing our staffing level was very high for the number of customers. We were also spending a fortune on our supplies like fruit and veg, and we had to find cheaper suppliers. (incidentally, we started with organic fruit and veg, but gave up on that after a few weeks because nobody seemed to really care!)
Of course sales rebounded as the weather because a bit milder, up to around £400/day again, and when we introduced bagels they got even better. But again, when the cold hit, our sales dropped off again.
Sales per square foot…of the menu board
Now you’ve got to be thinking about what the hell happened with all our hot drinks. Given that 50% of our menu board is made up of teas, it’s shocking that it only generates about 1% of sales! That’s for a few reasons. 1. Most people see us as a ‘juice bar’. Ie. they don’t actually acknowledge the ‘infusions’ side of what we do. Hence nobody thinks to come to use for teas. 2. Not that many people understand what we mean by ‘infusions’, again giving them no reason to visit unless they want a juice. Thirdly, tea is still a new area. Sure people drink tea all the time, but they’re quite happy with their pg tips. Few people actually explore tea beyond that. When we finally did some tea sampling a week ago, our tea sales instantly shot up. We sampled the spicy teas, especially because they are bold and warming in the cold weather. They went down really well and instantly our tea sales that day went from £5 to £50. That’s right, 900% sales increase! Since margins are good on the teas, that’s where we should have been focusing in the run up to the cold weather. When people came in that day and saw our range of teas, many commented on how extensive the menu was. It was also interesting how many people, regulars, then said ‘I didn’t realise you did teas!’ 50% of our entire menu board is made up of teas, yet it is completely overlooked by people since they come in and consider us to be a juice bar. That’s definitely something we need to change.
Chasing our tails
We’ve finally realised that due to the delays in opening, we’ve been constantly chasing our tails. We should have been marketing the hot drinks 2 months ago, building up our presence as a ‘tea bar’, but instead we were still quite new and building up our position as a ‘juice bar’ as a result, when the time is right, ie winter, nobody knows about our hot drinks! We’re decided now to tackle all this head on, and have started working with a PR & marketing company, who have worked with startups before and helped them get off the ground with PR and local marketing, as well as helping with the consistency of the brand image and message both in the store and with our online presence. They’ve agreed to a fee structure with a low retainer in which they get paid more once they hit certain milestones. After the experience with our EPOS supplier and shopfitter, and this is the only way I want to work with people, I want their reward tied into our success as well. We’ve just started working with them so will let you know what happens. Our biggest issue is really that not enough people know about us, so if they can address that, I am confident that we can double our customers numbers fairly quickly.
Big shout out to the gang
Finally I’d like to touch upon the issue of staff. We were lucky to find some really good staff members from the outset. Emanuele, our manager, came on board long before we launched and despite the delays in launching he hung in there. He is as determined as I am to make this business a success. We’re already looking at our second site, and it’s good to know that I have someone like him on board. Totally reliable with a fantastic work ethic. Similarly, I have made Martina a second manager, with a view to promoting her to full manager when Emanuele moves onto the next site. She and Emanuele are like chalk and cheese, but that’s precisely why she’s important to the business. She brings a different perspective to the business and acts as our conscience, particularly in an environmental sense. I’ve made her ‘chief environmental officer!’ She also has a strong interest in the teas and I’m counting on her to spread her knowledge to others. Jonno brings a wealth of experience with youthful energy and ideas and is best at ensuring consistency in our products. I’ve put him in charge of making sure everyone makes the drinks correctly. Eliza has a strong interest in health, and I’m hoping to put her and Martina on a nutrition course, then they can both advise customers much better. Finally Carla brings a very strong work ethic and works very hard. She never stands still and always finds things to do. She plans to work in the care industry and is only working with us as she does her training in that field, so unfortunately we may not have her for long.
We’re getting there…
So all in all, it’s going well. We have a good team, lots of ideas and so far still lots of energy. There have been down periods, especially as everyone becomes disheartened when sales drop, and particularly when I had to cut back the staff hours to reduce our cash outflow. We’re still not breaking even, but with the new marketing company on board, and with all our new product ideas and menu rejigging, I think it will be fine. By March our sales will pick up anyway, so we just need to put lots of effort into marketing the hot products for the next few weeks, then start marketing detox plans in time for January, when most people will come with their new year resolutions to start being healthy!
Loads more to tell you, especially many of the issues we’ve grappled with, particularly regarding the products and direction that we take. For example, the issue of doing coffee created huge debate; as did the choice of decor, selling food products and many more things. Many people don’t realise the amount of thought and effort that goes into every aspect of a small business. I will never again take for granted any small retailer or independent business again!
4 years studying Law and I still didn’t insist on a proper contract!!
The last time I wrote, I was getting extremely impatient with the shop fit out process. our shopfitters, proved to be extremely unreliable. Nick, the owner of the shopfitting company, had promised me that the works would be completed within 4 weeks of signing the contract with TFL, so in theory it should all have been completed by late June. As it turned out, despite the fact that we had agreed and signed off all the designs and plans back in April, and that I had paid deposits, Nick did not contract out the actual bar build until much later. As a result, the bar itself was not completed until late July!! To make matters worse, they kept saying that the internal works in the shop would only take a week, and therefore they did nothing until August when the bar was actually ready to go in. Then, when they began the internal works, they ran into all sorts of problems causing even more delays. In short, the entire project was poorly managed by them, and they took on multiple projects which all had to be delivered at the same time, and in his own words “the wheels came off!” Two other juice bars had exactly the same delays that I experienced at the same time, showing very clearly that these guys didn’t know what they were doing. Even once the bar was “completed”, there were quite a few things which still hadn’t been completed or done properly including some plumbing works. Some final things still haven’t been completed and probably never will! And after all of that, they had the audacity to demand more money for the work (almost 30% extra). The delays they caused meant we didn’t open the bar until the end of summer, which we were relying on to build up our customer base before we go into the colder months. Needless to say, we are disputing their claim for a higher amount, and I’m so annoyed about it that I’m happy to take them to court over it if it comes to that.
The marketing campaigns kick off
Meanwhile, back in the juice bar, we launched on a sunny day, and from day 1 we had lots of people come in first thing in the morning. They’d all seen the sign up and were eager for us to open. Of course, despite all the training, we were terrible at keeping up with orders and our service was a bit slow, causing many potential customers to walk away from the line. After a couple of weeks though, we found our rhythm, and got much more faster and smoother at taking and executing the orders, and business started picking up. We did lots of local marketing, with our leaflets, sampling the smoothies outside the shop and corporate days for local companies offering 50% discounts. We built good relationships with our customers and lots of them became regulars.
Sales started at around £200 per day, and slowly increased. We introduced fantastic snacks such as health bars, which sold well. We tried sandwiches, but found that it didn’t really work. We were selling organic sandwiches from “Fresh! Naturally Organic”. However we found that since we are surrounded by food outlets (Pret, Eat, etc), we were only selling a handful a day. We originally thought it might encourage people to buy a smoothie with their sandwich, but we found that those buying sandwiches rarely bought a smoothie with it, probably as the combined cost was too high. We couldn’t sell cheap sandwiches as it doesn’t go with our brand, and there is a ‘treats’ in the station, so if someone wants cheap sandwiches they go there. Since our minimum order on sandwiches was about £50, and we only sold a few, we were losing money EVERY day. Finally, after a few weeks, we scrapped it, and moved the £1,000 display fridge we’d bought into a warehouse. So the whole experiment ended up costing us around £2k, but we had to try it!
When do we reach breakeven?
In the meantime, total sales were increasing, and we were regularly hitting £350/day. This was driven by smoothies. We wanted people to understand that for every day purposes, maximum nutrition comes from juices, especially our super-juices that contain vegetables. Nonetheless smoothies made up two-thirds of our sales particularly as the breakfast smoothies were gaining popularity, indicating that people were using it as a meal replacement. We started selling more of our ‘breakfast anytime’ smoothies, with oats or granola-top. Sales gradually started climbing towards £400/day.
Now all this time, bear in mind that our basic breakeven figure stands at around £800/day give or take. Juices and smoothies have low margins due to the high product costs, so the gross margin (ie. sales price – fruit, cups, lid, straw and VAT) is around 55%. The margins on hot drinks, like the teas, are higher at around 70%, but we sold very few of these. Given the level of rent and rates, staff costs, overheads, etc. We had to sell around 250 drinks per day to break even, and we were hitting around 120-150.
Also, it’s worth noting that we are a ‘natural tonic bar’ situated bang-slap in the middle of an extremely dense office area, with around 40,000 potential customers, half of whom use the station, and around a quarter of which pass the shop on a regular basis. Nevertheless, we found that despite all our marketing efforts, people just didn’t know we were there. People would stop in the shop two months after launch and be shocked when we told them how long we’d been open. As with most office workers, they walked past each morning and evening in a zombied state and never noticed us, despite all the bright colours and sampling outside the shop. Needless to say therefore, many of those workers that used other exits from the station had never heard of us. We kicked off marketing campaigns targeting offices in the local area, offering 50% discounts, which did create more awareness, but the campaign was limited by the amount of time I had to devote to it, given all the other hats I was wearing. I had to call up each company and arrange for someone to distribute vouchers internally (we’d already done the external flyering so thought this was a better approach) But all this took time.
Technology…why does it never work?
At this point, I was still grappling with the EPOS and website systems. The company that I had hired to do the EPOS and website development over-promised and grossly under-delivered. They had outsourced the development to a team in India, and I found myself on the phone to them every morning for about two months to get the EPOS and website up and running. The whole system was supposed to be integrated, for electronic loyalty cards, web-ordering, etc. As it turned out, it was a complete mess, nothing worked and we ended up going back to basics. But even then, as a standalone EPOS system, they couldn’t make simple things work, like the cash-drawer opening, or end-of-day reports. We’re still working through these problems. This was all a classic mistake of mine, I expected quite a lot, on a small budget, from a company that ‘said’ they could do everything, but could not give me concrete examples. Since it was a new concept, I accepted it, but in retrospect given the amount of time I have had to put into it I should have gone with a simpler system and with another company altogether.
At the same time, I was also working on all the marketing aspects of the business. As I said earlier I was doing all the local marketing, calling up companies and teaming up to do promotions, going out flyering and getting teams of people to flyer, doing specific corporate days for big local companies (TFL, Scotland Yard, etc). At the same time, I was trying to do basic bookkeeping so that I could get a grip on our incomings and outgoings. Even though we have an accountant, on a day to day basis I find it’s easier doing it myself. On top of all this, I was looking into every other aspect of the business, suppliers, products, even furniture all the way through to recycling bags, and small things like poster holders. All in all, I was getting very quickly swamped.
I just need a break…
So, I did what every entrepreneur does when faced with this, I took a holiday!! Now I know this sounds a bit crazy, but to be honest it wouldn’t have changed much. But given how busy the last six months had been, I’d promised Meenal (the missus for those not keeping up) that we’d take a holiday after the business was stabilised. Even though it was far from stabilised, I thought that we were running into a problem of being so deeply sucked into the business that I was losing sight of broader business objectives. I thought the two week break would do me some good too. So we went off to Tanzania on an amazing holiday.
Of course, as soon as I went, business fell off a cliff!! To be fair to everyone involved, it wasn’t because I wasn’t here – I’m not that important to the business. I have more than capable staff, and we had put everything in place, and got all the supplies we needed before I left. No, it was the first spell of really cold weather. Just as our sales were averaging £400/day, the cold weather causes sales to fall down to £250. Smoothies are cold, and seen as summer drinks by many, so the only customers that continued coming were those that bought breakfast smoothies, ie. as breakfast replacements; or those that appreciate that juices, especially super juices, are in fact quite warming and exactly what you need going into winter to build up the old immune system.
Reality sets in
At this stage the staff were getting pretty depressed about the situation. My most senior staff, Emanuele and Martina had both been away a few weeks earlier and come back energised and rejuvenated, but both were feeling pretty down about this. I guess in some way they also felt responsible since I was away and it happened on their watch. But to be hinest it couldn’t be helped. We hadn’t established the business enough for customers to shift to the winter drinks, the warming juices, the hot teas and herbal infusions, etc.
When I did get back, we were obviously in a bit of a panic, and had to focus very had on costs. For one thing our staffing level was very high for the number of customers. We were also spending a fortune on our supplies like fruit and veg, and we had to find cheaper suppliers. (incidentally, we started with organic fruit and veg, but gave up on that after a few weeks because nobody seemed to really care!)
Of course sales rebounded as the weather because a bit milder, up to around £400/day again, and when we introduced bagels they got even better. But again, when the cold hit, our sales dropped off again.
Sales per square foot…of the menu board
Now you’ve got to be thinking about what the hell happened with all our hot drinks. Given that 50% of our menu board is made up of teas, it’s shocking that it only generates about 1% of sales! That’s for a few reasons. 1. Most people see us as a ‘juice bar’. Ie. they don’t actually acknowledge the ‘infusions’ side of what we do. Hence nobody thinks to come to use for teas. 2. Not that many people understand what we mean by ‘infusions’, again giving them no reason to visit unless they want a juice. Thirdly, tea is still a new area. Sure people drink tea all the time, but they’re quite happy with their pg tips. Few people actually explore tea beyond that. When we finally did some tea sampling a week ago, our tea sales instantly shot up. We sampled the spicy teas, especially because they are bold and warming in the cold weather. They went down really well and instantly our tea sales that day went from £5 to £50. That’s right, 900% sales increase! Since margins are good on the teas, that’s where we should have been focusing in the run up to the cold weather. When people came in that day and saw our range of teas, many commented on how extensive the menu was. It was also interesting how many people, regulars, then said ‘I didn’t realise you did teas!’ 50% of our entire menu board is made up of teas, yet it is completely overlooked by people since they come in and consider us to be a juice bar. That’s definitely something we need to change.
Chasing our tails
We’ve finally realised that due to the delays in opening, we’ve been constantly chasing our tails. We should have been marketing the hot drinks 2 months ago, building up our presence as a ‘tea bar’, but instead we were still quite new and building up our position as a ‘juice bar’ as a result, when the time is right, ie winter, nobody knows about our hot drinks! We’re decided now to tackle all this head on, and have started working with a PR & marketing company, who have worked with startups before and helped them get off the ground with PR and local marketing, as well as helping with the consistency of the brand image and message both in the store and with our online presence. They’ve agreed to a fee structure with a low retainer in which they get paid more once they hit certain milestones. After the experience with our EPOS supplier and shopfitter, and this is the only way I want to work with people, I want their reward tied into our success as well. We’ve just started working with them so will let you know what happens. Our biggest issue is really that not enough people know about us, so if they can address that, I am confident that we can double our customers numbers fairly quickly.
Big shout out to the gang
Finally I’d like to touch upon the issue of staff. We were lucky to find some really good staff members from the outset. Emanuele, our manager, came on board long before we launched and despite the delays in launching he hung in there. He is as determined as I am to make this business a success. We’re already looking at our second site, and it’s good to know that I have someone like him on board. Totally reliable with a fantastic work ethic. Similarly, I have made Martina a second manager, with a view to promoting her to full manager when Emanuele moves onto the next site. She and Emanuele are like chalk and cheese, but that’s precisely why she’s important to the business. She brings a different perspective to the business and acts as our conscience, particularly in an environmental sense. I’ve made her ‘chief environmental officer!’ She also has a strong interest in the teas and I’m counting on her to spread her knowledge to others. Jonno brings a wealth of experience with youthful energy and ideas and is best at ensuring consistency in our products. I’ve put him in charge of making sure everyone makes the drinks correctly. Eliza has a strong interest in health, and I’m hoping to put her and Martina on a nutrition course, then they can both advise customers much better. Finally Carla brings a very strong work ethic and works very hard. She never stands still and always finds things to do. She plans to work in the care industry and is only working with us as she does her training in that field, so unfortunately we may not have her for long.
We’re getting there…
So all in all, it’s going well. We have a good team, lots of ideas and so far still lots of energy. There have been down periods, especially as everyone becomes disheartened when sales drop, and particularly when I had to cut back the staff hours to reduce our cash outflow. We’re still not breaking even, but with the new marketing company on board, and with all our new product ideas and menu rejigging, I think it will be fine. By March our sales will pick up anyway, so we just need to put lots of effort into marketing the hot products for the next few weeks, then start marketing detox plans in time for January, when most people will come with their new year resolutions to start being healthy!
Loads more to tell you, especially many of the issues we’ve grappled with, particularly regarding the products and direction that we take. For example, the issue of doing coffee created huge debate; as did the choice of decor, selling food products and many more things. Many people don’t realise the amount of thought and effort that goes into every aspect of a small business. I will never again take for granted any small retailer or independent business again!
Friday, June 13, 2008
Launching in 4 weeks
How many times have I said these very words, fully believing it was possible? Well now I will not utter these words until I am absolutely positively certain that it’s true. Yep, you’ve guessed it, I’m learning that all-important business attribute – patience.
Let me start by telling you that we finally completed on the legal process a couple of weeks ago and formally signed the lease, so I am now the proud owner of…a six year debt.
Following numerous conversations with the shopfitters, I was under the impression that the shopfitting work would start immediately upon completion of the lease agreement. Unfortunately that did not happen. For those that don’t know, there are three parts to the shopfitting process – the designing, and subsequent submission of designs; the building of the bar itself in a factory; the internal works and decoration of the store. After initial faffing on the design part (due to overthought on the design, and multiple designers working on it) we finally agreed the design and submitted the plans. This had to be done prior to completion. I was then told that the bar would take 4-6 weeks to build in a factory in Poland. Since I was keen to launch asap after completion, they agreed to build it more quickly in the UK, and secured a 4 week timeframe. This was about 5 weeks ago. We signed the lease 2 weeks ago, but the internal works still have not begun. The long and short of it is that they have overstretched themselves and are finding it difficult to complete all the current jobs within the timeframe specified. And although the internal works should only take a couple of weeks, they now think that the bar-build won’t be completed for several weeks and thus the shopfit won’t be completed until mid-july…arghhh!!
Unfortunately I did not get the timelines agreed in advance of awarding the contract. There was so much we had to get underway with, that I had to just take their word that work would be completed within a certain time frame. While I still trust them to get the work completed to a good standard, it will be a bit behind schedule and it’s not the end of the world. But in retrospect I wish I had a more watertight agreement in place. Not that it would change much or affect anything, but at least it would give me a more solid ground to stand on when harassing them to complete the works. Oh well, live and learn.
And talking of learning along the way, we are having our web design and marketing materials design completely re-done to achieve a look and feel that is more consistent with the image we are trying to create. In fact I have actually taken to working on the design work myself. I had awarded the web/marketing company all the work on the basis that they would bring creativity, together with experience to put together a coherent branding package for our website and marketing materials. But I was so disappointed with the creativity and type of design work, that I took over much of the process and put it together myself, including things like images to use, fonts, text size, colours, layout, etc. All the type of thing you would think I was actually paying for. I handed it back at the end for them to ‘professionalise’! It’s a shame, it’s not that they didn’t work hard, it’s just that, in my view, they lacked the creativity required for the city market, and they lacked the attention to detail I would have expected. I went with this firm partly because a friend is a co-owner, and I like to support other small businesses, but also because one of the owners has extensive experience with marketing in large firms like pepsico and Disney. However his wife had a baby, so he was off at precisely the time that all this work was going on, and we lost his creative input. Unfortunately the others lacked city-experience and therefore their creativity was just not what we were looking for. Hence I had to take over much of the process, and work with Meenal as well as friends and cousins to put something good together. It is finally taking shape though.
Apart from this, I hired a manager to start around the beginning of May, as I thought we would be launched by then. Nevertheless he was happy to work on half pay until we do actually launch, and he has proven to be excellent, both in his dedication and attitude. He is doing research that I cannot get around to, he is taking over the recruitment process, and he has made contact with excellent suppliers for the food side, whom he has worked with previously. He is also learning about our USP and getting very good at explaining our key differentiating factors to other people.
Finally, another exciting development is that when I was looking to go into the salad bar business, I got talking to a branding/marketing company that also worked as business advisors to small companies. As it happened, they worked closely with what would have been one of our competitors. Upon further consideration, I decided that we were two years behind our competitors, and it would be silly to launch, when the four companies out there were about to go into expansion phase. Hence I decided to focus on the juice and infusion bar. However the owner of the branding company got in touch recently suggesting that we meet with the owner of the salad bar company that they work with, with a view to expanding it together either through a franchise or some other relationship like a joint investment. So many people have expressed an interest in investing in whichever business I start up, that I thought this could be a good opportunity to help other people invest their money in an area that is definitely growing. So I should be meeting with them in a couple of weeks to see if there is any potential there.
OK, that’s it for now, while there is still plenty to do, such as work on marketing plans, etc. it really is a matter of waiting for the shop-fit to be completed. I’m using the time wisely, to sort out my piles of admin! Not fun. But at least I’m learning about patience. And I’m getting back into my yoga and meditation…can’t be a bad thing.
Let me start by telling you that we finally completed on the legal process a couple of weeks ago and formally signed the lease, so I am now the proud owner of…a six year debt.
Following numerous conversations with the shopfitters, I was under the impression that the shopfitting work would start immediately upon completion of the lease agreement. Unfortunately that did not happen. For those that don’t know, there are three parts to the shopfitting process – the designing, and subsequent submission of designs; the building of the bar itself in a factory; the internal works and decoration of the store. After initial faffing on the design part (due to overthought on the design, and multiple designers working on it) we finally agreed the design and submitted the plans. This had to be done prior to completion. I was then told that the bar would take 4-6 weeks to build in a factory in Poland. Since I was keen to launch asap after completion, they agreed to build it more quickly in the UK, and secured a 4 week timeframe. This was about 5 weeks ago. We signed the lease 2 weeks ago, but the internal works still have not begun. The long and short of it is that they have overstretched themselves and are finding it difficult to complete all the current jobs within the timeframe specified. And although the internal works should only take a couple of weeks, they now think that the bar-build won’t be completed for several weeks and thus the shopfit won’t be completed until mid-july…arghhh!!
Unfortunately I did not get the timelines agreed in advance of awarding the contract. There was so much we had to get underway with, that I had to just take their word that work would be completed within a certain time frame. While I still trust them to get the work completed to a good standard, it will be a bit behind schedule and it’s not the end of the world. But in retrospect I wish I had a more watertight agreement in place. Not that it would change much or affect anything, but at least it would give me a more solid ground to stand on when harassing them to complete the works. Oh well, live and learn.
And talking of learning along the way, we are having our web design and marketing materials design completely re-done to achieve a look and feel that is more consistent with the image we are trying to create. In fact I have actually taken to working on the design work myself. I had awarded the web/marketing company all the work on the basis that they would bring creativity, together with experience to put together a coherent branding package for our website and marketing materials. But I was so disappointed with the creativity and type of design work, that I took over much of the process and put it together myself, including things like images to use, fonts, text size, colours, layout, etc. All the type of thing you would think I was actually paying for. I handed it back at the end for them to ‘professionalise’! It’s a shame, it’s not that they didn’t work hard, it’s just that, in my view, they lacked the creativity required for the city market, and they lacked the attention to detail I would have expected. I went with this firm partly because a friend is a co-owner, and I like to support other small businesses, but also because one of the owners has extensive experience with marketing in large firms like pepsico and Disney. However his wife had a baby, so he was off at precisely the time that all this work was going on, and we lost his creative input. Unfortunately the others lacked city-experience and therefore their creativity was just not what we were looking for. Hence I had to take over much of the process, and work with Meenal as well as friends and cousins to put something good together. It is finally taking shape though.
Apart from this, I hired a manager to start around the beginning of May, as I thought we would be launched by then. Nevertheless he was happy to work on half pay until we do actually launch, and he has proven to be excellent, both in his dedication and attitude. He is doing research that I cannot get around to, he is taking over the recruitment process, and he has made contact with excellent suppliers for the food side, whom he has worked with previously. He is also learning about our USP and getting very good at explaining our key differentiating factors to other people.
Finally, another exciting development is that when I was looking to go into the salad bar business, I got talking to a branding/marketing company that also worked as business advisors to small companies. As it happened, they worked closely with what would have been one of our competitors. Upon further consideration, I decided that we were two years behind our competitors, and it would be silly to launch, when the four companies out there were about to go into expansion phase. Hence I decided to focus on the juice and infusion bar. However the owner of the branding company got in touch recently suggesting that we meet with the owner of the salad bar company that they work with, with a view to expanding it together either through a franchise or some other relationship like a joint investment. So many people have expressed an interest in investing in whichever business I start up, that I thought this could be a good opportunity to help other people invest their money in an area that is definitely growing. So I should be meeting with them in a couple of weeks to see if there is any potential there.
OK, that’s it for now, while there is still plenty to do, such as work on marketing plans, etc. it really is a matter of waiting for the shop-fit to be completed. I’m using the time wisely, to sort out my piles of admin! Not fun. But at least I’m learning about patience. And I’m getting back into my yoga and meditation…can’t be a bad thing.
Tuesday, March 18, 2008
After banking, everything seems slow
Things are progressing sooo slowly. Now I appreciate the speed at which things were done in banking. (although, as I write, I have just finished reading about the rapid demise of Bear Stearns…so perhaps the fast pace has it’s pros and cons!)
The St James Park terms have finally (finally!!) been agreed and it has been passed onto the lawyers to scrutinise. In fairness to my broker, he was doing all he could to secure me a good deal in the face of transport for London, who are tough negotiators. All the while, I was calling him every couple of days to push things along. The poor guy is off sick this week…hope it wasn’t my fault.
Meanwhile I am trying to push along the shop fitters to complete a deal. While I am trying to get a decent price, I already know the look and feel I want to go for, and it is important to me that I work with people I like working with. I have found an excellent company whose product I like, and have been ready to proceed with a formal agreement for the past few weeks. I just need to see final plans and a formal quote. Unfortunately, the process is dragging along. They sound like they are keen to get the business, and build a longer-term relaionship to win future business, but I just can’t seem to get them to get a move on and start working on plans. I even got the designs done externally and gave it to them. You might think that they are not really interested in the work, but then they have spent many hours with me going through stuff related to it and continue to do so!? Finally a few days ago I met with them and said that I need them to be able to deliver as soon as the legal work is completed, ie about 4-5 weeks time, and unless they formalise the quote and agreement by the end of this week I cannot work with them. The build alone will take about 4 weeks!! I think they get the point. Lets see what they come back with. While I have spoken to other companies, I like these guys and their product so I hope we can reach an agreement.
On the tea front, I have finally had much better luck. When I came back from the US, I had thought about trying to become a UK distributor for one of the US companies I liked – Mighty Leaf or Serendipitea. Either way, I thought it would be great to use their product in our stores and sell the stuff for home consumption too. It turns out that Mighty Leaf have already paired up with a UK distributor, a small family outfit. I like their product and have been sampling loads of it recently. Only downside is that we have to redistribute under their brand, while I thought it would be great to do it under our own brand. If we become quite big, which I think we will, then it would be a shame to not benefit from the brand awareness that will come from selling these teas in our stores.
However in the meantime, I also finally managed to get hold of the owner of Serendipitea. She was really excitied about what we are doing, and is also happy for us to market under our own brand name. She even went as far as to say that we can effectively become their UK and European distributor. I need to formalise this, but they already have similar agreements for the far east, and it would be great to market their stuff into the UK market. Once again, I have been sampling their stuff and it’s amazing. The only downside is that we have to deal with import costs, duties (did u know there is a 13% duty on importing herbal teas!!), and repackaging. But it could be fun, and give us a new business opportunity, ie. Website orders, selling it into the supermarkets, etc.
Finally another very exciting development has been my work with Mikael from Gogo juice. This is the company I mentioned previously that I had approached about a franchise opportunity, but walked away with a view to working together on building a bigger, stronger chain of juice or tonic bars based on the new concept we were introducing. With Mikael’s experience in the business, and my background in business/finance and this new concept, it would be a fantastic partnership. We have agreed recently that it would be great to go back and rebrand the existing juice bars, and offer the broader range of products that TONIC is bringing in. This gives TONIC an instant chain of outlets and a broader brand recognition, while it brings more business opportunities for the individual juice bars. Then, going forward, we can continue to open some company-owned stores, and also franchise out the broader TONIC concept. It has been really good fun working together and thrashing out ideas, and we both have complimentary skills, so I’m really excited about formally joining forces and attacking the market together.
Anyway, I guess when you think about it, a lot is actually happening. I’m just used to being busy all the time and it feels weird when I suddenly get times when I have nothing more to do and am waiting for people to come back to me. I guess I could get my butt into the gym.
It’s weird, whenever I talk to people about what I’m doing, I get really excited about it. It’s not just the concept, it’s having a free hand to build the business in any direction I like, it’s working when I like, and having flexibility in my day to day routine. If anyone is thinking of starting a business, I’d seriously recommend it…it’s definitely more fun than I ever had working for the bank. Of course I miss working with the people at the bank, because on a day to day basis it can be quite lonely working on your own. That’s another reason why I think it will be fun to partner up with someone. But I’m sure that as soon as I launch I’ll be a lot busier, so in the meantime I better make the most of things like going to the gym…
The St James Park terms have finally (finally!!) been agreed and it has been passed onto the lawyers to scrutinise. In fairness to my broker, he was doing all he could to secure me a good deal in the face of transport for London, who are tough negotiators. All the while, I was calling him every couple of days to push things along. The poor guy is off sick this week…hope it wasn’t my fault.
Meanwhile I am trying to push along the shop fitters to complete a deal. While I am trying to get a decent price, I already know the look and feel I want to go for, and it is important to me that I work with people I like working with. I have found an excellent company whose product I like, and have been ready to proceed with a formal agreement for the past few weeks. I just need to see final plans and a formal quote. Unfortunately, the process is dragging along. They sound like they are keen to get the business, and build a longer-term relaionship to win future business, but I just can’t seem to get them to get a move on and start working on plans. I even got the designs done externally and gave it to them. You might think that they are not really interested in the work, but then they have spent many hours with me going through stuff related to it and continue to do so!? Finally a few days ago I met with them and said that I need them to be able to deliver as soon as the legal work is completed, ie about 4-5 weeks time, and unless they formalise the quote and agreement by the end of this week I cannot work with them. The build alone will take about 4 weeks!! I think they get the point. Lets see what they come back with. While I have spoken to other companies, I like these guys and their product so I hope we can reach an agreement.
On the tea front, I have finally had much better luck. When I came back from the US, I had thought about trying to become a UK distributor for one of the US companies I liked – Mighty Leaf or Serendipitea. Either way, I thought it would be great to use their product in our stores and sell the stuff for home consumption too. It turns out that Mighty Leaf have already paired up with a UK distributor, a small family outfit. I like their product and have been sampling loads of it recently. Only downside is that we have to redistribute under their brand, while I thought it would be great to do it under our own brand. If we become quite big, which I think we will, then it would be a shame to not benefit from the brand awareness that will come from selling these teas in our stores.
However in the meantime, I also finally managed to get hold of the owner of Serendipitea. She was really excitied about what we are doing, and is also happy for us to market under our own brand name. She even went as far as to say that we can effectively become their UK and European distributor. I need to formalise this, but they already have similar agreements for the far east, and it would be great to market their stuff into the UK market. Once again, I have been sampling their stuff and it’s amazing. The only downside is that we have to deal with import costs, duties (did u know there is a 13% duty on importing herbal teas!!), and repackaging. But it could be fun, and give us a new business opportunity, ie. Website orders, selling it into the supermarkets, etc.
Finally another very exciting development has been my work with Mikael from Gogo juice. This is the company I mentioned previously that I had approached about a franchise opportunity, but walked away with a view to working together on building a bigger, stronger chain of juice or tonic bars based on the new concept we were introducing. With Mikael’s experience in the business, and my background in business/finance and this new concept, it would be a fantastic partnership. We have agreed recently that it would be great to go back and rebrand the existing juice bars, and offer the broader range of products that TONIC is bringing in. This gives TONIC an instant chain of outlets and a broader brand recognition, while it brings more business opportunities for the individual juice bars. Then, going forward, we can continue to open some company-owned stores, and also franchise out the broader TONIC concept. It has been really good fun working together and thrashing out ideas, and we both have complimentary skills, so I’m really excited about formally joining forces and attacking the market together.
Anyway, I guess when you think about it, a lot is actually happening. I’m just used to being busy all the time and it feels weird when I suddenly get times when I have nothing more to do and am waiting for people to come back to me. I guess I could get my butt into the gym.
It’s weird, whenever I talk to people about what I’m doing, I get really excited about it. It’s not just the concept, it’s having a free hand to build the business in any direction I like, it’s working when I like, and having flexibility in my day to day routine. If anyone is thinking of starting a business, I’d seriously recommend it…it’s definitely more fun than I ever had working for the bank. Of course I miss working with the people at the bank, because on a day to day basis it can be quite lonely working on your own. That’s another reason why I think it will be fun to partner up with someone. But I’m sure that as soon as I launch I’ll be a lot busier, so in the meantime I better make the most of things like going to the gym…
Monday, March 3, 2008
Zooming ahead
It’s all happening. We have identified and won our first site at St James Park station. I say ‘won’ because we had to fight off two other juice bars to secure this site. It was a combination of the rent we were willing to pay, the business concept, and the operational infrastructure. It really helped having Mikael on board, he’s the guy that owns the other juice bar chain. One of the other juice bars was another new start up as well, with the backing of the owner of an Australian juice bar. It was tough, but we pushed the fact that through Gogo, we had established UK juice market experience and operational infrastructure in place. I think that sealed it.
So we’re now pushing ahead to complete the deal, and sign the lease. My property surveyor is taking care of the negotiations, while I push forward with all the other stuff. And all the other stuff is a helluva lot of stuff. Luckily, I managed to find a good business banking manager early on through my brother-in-law, and they’ve agreed to fund everything secured against my assets, including USD savings…phew! I didn’t want to move that money over with the current exchange rates. Now there’s a few other things to take care of - shopfittings, designs, logos, website, EPOS, cup design, accountants, lawyers, etc. And each of these things has a host of other requirements, both technical and operational. For example the shopfitting requires us to carry out asbestos surveys, electrical wiring, get our plans approved, etc. While I can get other people to help with parts of these, for example the shop-fit related stuff, it requires me to be on top of it all, as I’m the one who’s screwed if something gets left out. So now I’m kind of a project manager, as well as text writer and editor for the website, IT services manager, and everything else you can imagine!! There are so many things that you don’t even think about before you start a business that are now coming to light. Nevertheless, it’s great fun!!!
Given how long this is taking, we have started focusing on our second site, much more in the heart of the city. That is the ultimate goal, and although the rent is astronomical, if my maths and planning are correct, that’s the one that will really hit the core of the market I’m after, and will catapult this business onto a new level. While St James Park is a good site, it is not out in the open at the heart of the office area. Nevertheless it will give us a chance to learn and then apply what we’ve learnt to the next site.
So things are pretty crazy right now. But I’m enjoying and that’s all that matters…
So we’re now pushing ahead to complete the deal, and sign the lease. My property surveyor is taking care of the negotiations, while I push forward with all the other stuff. And all the other stuff is a helluva lot of stuff. Luckily, I managed to find a good business banking manager early on through my brother-in-law, and they’ve agreed to fund everything secured against my assets, including USD savings…phew! I didn’t want to move that money over with the current exchange rates. Now there’s a few other things to take care of - shopfittings, designs, logos, website, EPOS, cup design, accountants, lawyers, etc. And each of these things has a host of other requirements, both technical and operational. For example the shopfitting requires us to carry out asbestos surveys, electrical wiring, get our plans approved, etc. While I can get other people to help with parts of these, for example the shop-fit related stuff, it requires me to be on top of it all, as I’m the one who’s screwed if something gets left out. So now I’m kind of a project manager, as well as text writer and editor for the website, IT services manager, and everything else you can imagine!! There are so many things that you don’t even think about before you start a business that are now coming to light. Nevertheless, it’s great fun!!!
Given how long this is taking, we have started focusing on our second site, much more in the heart of the city. That is the ultimate goal, and although the rent is astronomical, if my maths and planning are correct, that’s the one that will really hit the core of the market I’m after, and will catapult this business onto a new level. While St James Park is a good site, it is not out in the open at the heart of the office area. Nevertheless it will give us a chance to learn and then apply what we’ve learnt to the next site.
So things are pretty crazy right now. But I’m enjoying and that’s all that matters…
Monday, January 21, 2008
Bring on the juice
Since the last blog entries I have started focusing my attention on the juice bars again, since that is where my core interest is. I enjoy the thought of working in a health and nutrition-driven, lively business. Although there are a number of juice bars in the UK now, they are mostly focused on shopping centres and other climate controlled, high footfall areas. Very few focus on the professional office market in the city of London.
The established juice bars are, broadly speaking, pretty simple. They tend to be small kiosks offering a basic range of juices and smoothies. Most of these are sweeter drinks made from apple, carrot, orange, etc. Many people like these, but if you drink fresh juice on a daily basis, the natural sugars have to be balanced out by the more beneficial vegetables such as leafy greens. Done properly, these can be used to make very tasty drinks, which are also much more nutritious.
Furthermore, due to the lack of space and minimal staff, many kiosks use pre-chopped fruits (which become oxidised!), pre-made mixers (dead ingredients), and fast, but poor juicing techniques. All of these things can reduce the nutritional benefits of juicing.
With growing interest in juicing, as well as a general drive to all things healthy, the market is ready for much better quality and more professional outfits, and I can think that nowhere is this more appropriate than in the city of London and surrounding office areas. It’s a well educated demographic that understands the health benefits of juicing. They tend to be cash-rich and time-poor, hence juicing is a great way for them to get their health on track. It also presents a good alternative to coffee, with natural energy boosting properties. And of course they taste great!
The problem of course is that juice bars on their own suffer from the cold, damp weather in the UK, when many people don’t want juice. They consider it too cold, even though most juices are served at room temperature. We decided that this can be overcome in two ways. Firstly by promoting the health benefits of juicing, especially the heating properties of particular ingredients like ginger. The second is that we can introduce hot, healthy, nutritious drinks alongside it, such as warm juices, tea-based drinks and juice-tea blends. The tea base in particular enables us to open the door to a whole host of healthy drinks, using loose leaf tea, blended with vegetables, fruits and herbs.
At first, we thought something along the lines of a general drinks bar, but with juice at the heart of it would work, such as PURE – Juice & Java. This would enable us keep our primary focus on juices, but also offer hot drinks, including coffees and tea. As the number one drink consumed in the UK (having overtaken tea a few years ago), we thought it would be good to include premium coffees that were produced in a professional manner by hand, using freshly roasted coffee – everything Starbucks does not do! The UK market definitely needs more ‘proper’ coffee bars. Also, the name sounds catchy, and we demonstrate the ‘purity’ of the drinks, offering the highest quality in both.
Further research and monitoring of the market however revealed that, as is well known, the London coffee market is absolutely saturated. While you have an abundance of Starbuck, Caffe Nero and Costa, you also have every other food retailer shouting about their premium coffee quality. In reality, very few of these serve freshly roasted coffee. However what it made me realise is that most people are fine with the coffee they drink, and most of these places serve pretty good coffee, even if not the best. I am hearing of some specialist coffee retailers opening up, addressing this shortcoming in the market, but again only a connoisseur would appreciate it. In short, there is very little point trying to compete in such a crowded market, when we have something already very unique to offer – high quality and really fresh juices and teas.
Thus we have now come to settle on the concept of ‘Natural Tonic’. At heart it is a juice bar, offering a proper range of juices and smoothies, but also doing so using a wide variety of fresh ingredients prepared to order, and offering the option to use equipment that is much more nutritious than that normally used (albeit it takes slightly longer to prepare). This will be complimented by a range of teas, especially tea blends that address particular health or nutrition requirements, such as calming, energising, detox, etc. We will go further still by offering blends with fresh fruit, vegetable and herb ingredients, such as ginger, mint or fennel.
Together, this focus on ‘natural tonics’ enables us to offer a wide range of nutritional, healthy and refreshing drinks, while balancing out the hot and cold offerings and thus giving us a strong year-round business. The professional approach that we will take to juicing, including customisation based on health and nutritional requirements, will demonstrate our strong focus on healthy drinks.
The premises will be modern, funky and energising, encouraging people to stay and learn more about our products, and also to ask questions to a knowledgeable staff. There will also be complimentary food offerings, although these will not be a core focus and most likely outsourced.
All the above is not done by any of the juice bars in London, and I reckon that, done properly, it could work quite well.
I have been thrashing out the concept and speaking about it to numerous people. Once we fully discuss the concept, most people consider it to be a good idea and think the idea is perfect for the city environment. I would love to hear your thoughts on this too.
I recently discussed this with the owner of an existing juice bar that owns 7 juice bars in shopping centres around london. He agreed that the more professional approach is exactly what would be needed in the city environment, and he has agreed to join me in this venture by providing operational support from his existing business, and take a financial stake too.
I have identified some premises that I think could work quite well and fit the budget. London rents are crazy, and rates aren't much better. So my dream of getting super-prime locations will have to wait until we can prove the concept. Super-prime locations have rents in excess of £80,000 and rates in excess of £40,000, and they usually don't give them to new businesses. Whereas reasonably 'prime' sites go for about half that amount. I think it is better to open a couple of locations in reasonably prime areas in order to maximise business initially, and then go for the super-prime ones. The other problem is that many sites require a premium to buy the lease, this is effectively a lump sum upfront payment of anything from £20-60k. Needless to say, we have to evaluate these carefully because it effectively wipes out a lot of our profit.
Our frontrunner is a premises in St James Park station for which we have put in an application. Although it is not in the city, where I ideally want my first sites to be, I think it is a good location with the right demographic (office workers) and very heavy footfall. At the same time, we will apply for something in the city, and the frontrunner there is Bow Lane.
It’s all coming together, and I will post the executive summary of my business plan onto this blog and invite any feedback. I'll also fill you in on what's happening with premises.
In the meantime, back to work…
The established juice bars are, broadly speaking, pretty simple. They tend to be small kiosks offering a basic range of juices and smoothies. Most of these are sweeter drinks made from apple, carrot, orange, etc. Many people like these, but if you drink fresh juice on a daily basis, the natural sugars have to be balanced out by the more beneficial vegetables such as leafy greens. Done properly, these can be used to make very tasty drinks, which are also much more nutritious.
Furthermore, due to the lack of space and minimal staff, many kiosks use pre-chopped fruits (which become oxidised!), pre-made mixers (dead ingredients), and fast, but poor juicing techniques. All of these things can reduce the nutritional benefits of juicing.
With growing interest in juicing, as well as a general drive to all things healthy, the market is ready for much better quality and more professional outfits, and I can think that nowhere is this more appropriate than in the city of London and surrounding office areas. It’s a well educated demographic that understands the health benefits of juicing. They tend to be cash-rich and time-poor, hence juicing is a great way for them to get their health on track. It also presents a good alternative to coffee, with natural energy boosting properties. And of course they taste great!
The problem of course is that juice bars on their own suffer from the cold, damp weather in the UK, when many people don’t want juice. They consider it too cold, even though most juices are served at room temperature. We decided that this can be overcome in two ways. Firstly by promoting the health benefits of juicing, especially the heating properties of particular ingredients like ginger. The second is that we can introduce hot, healthy, nutritious drinks alongside it, such as warm juices, tea-based drinks and juice-tea blends. The tea base in particular enables us to open the door to a whole host of healthy drinks, using loose leaf tea, blended with vegetables, fruits and herbs.
At first, we thought something along the lines of a general drinks bar, but with juice at the heart of it would work, such as PURE – Juice & Java. This would enable us keep our primary focus on juices, but also offer hot drinks, including coffees and tea. As the number one drink consumed in the UK (having overtaken tea a few years ago), we thought it would be good to include premium coffees that were produced in a professional manner by hand, using freshly roasted coffee – everything Starbucks does not do! The UK market definitely needs more ‘proper’ coffee bars. Also, the name sounds catchy, and we demonstrate the ‘purity’ of the drinks, offering the highest quality in both.
Further research and monitoring of the market however revealed that, as is well known, the London coffee market is absolutely saturated. While you have an abundance of Starbuck, Caffe Nero and Costa, you also have every other food retailer shouting about their premium coffee quality. In reality, very few of these serve freshly roasted coffee. However what it made me realise is that most people are fine with the coffee they drink, and most of these places serve pretty good coffee, even if not the best. I am hearing of some specialist coffee retailers opening up, addressing this shortcoming in the market, but again only a connoisseur would appreciate it. In short, there is very little point trying to compete in such a crowded market, when we have something already very unique to offer – high quality and really fresh juices and teas.
Thus we have now come to settle on the concept of ‘Natural Tonic’. At heart it is a juice bar, offering a proper range of juices and smoothies, but also doing so using a wide variety of fresh ingredients prepared to order, and offering the option to use equipment that is much more nutritious than that normally used (albeit it takes slightly longer to prepare). This will be complimented by a range of teas, especially tea blends that address particular health or nutrition requirements, such as calming, energising, detox, etc. We will go further still by offering blends with fresh fruit, vegetable and herb ingredients, such as ginger, mint or fennel.
Together, this focus on ‘natural tonics’ enables us to offer a wide range of nutritional, healthy and refreshing drinks, while balancing out the hot and cold offerings and thus giving us a strong year-round business. The professional approach that we will take to juicing, including customisation based on health and nutritional requirements, will demonstrate our strong focus on healthy drinks.
The premises will be modern, funky and energising, encouraging people to stay and learn more about our products, and also to ask questions to a knowledgeable staff. There will also be complimentary food offerings, although these will not be a core focus and most likely outsourced.
All the above is not done by any of the juice bars in London, and I reckon that, done properly, it could work quite well.
I have been thrashing out the concept and speaking about it to numerous people. Once we fully discuss the concept, most people consider it to be a good idea and think the idea is perfect for the city environment. I would love to hear your thoughts on this too.
I recently discussed this with the owner of an existing juice bar that owns 7 juice bars in shopping centres around london. He agreed that the more professional approach is exactly what would be needed in the city environment, and he has agreed to join me in this venture by providing operational support from his existing business, and take a financial stake too.
I have identified some premises that I think could work quite well and fit the budget. London rents are crazy, and rates aren't much better. So my dream of getting super-prime locations will have to wait until we can prove the concept. Super-prime locations have rents in excess of £80,000 and rates in excess of £40,000, and they usually don't give them to new businesses. Whereas reasonably 'prime' sites go for about half that amount. I think it is better to open a couple of locations in reasonably prime areas in order to maximise business initially, and then go for the super-prime ones. The other problem is that many sites require a premium to buy the lease, this is effectively a lump sum upfront payment of anything from £20-60k. Needless to say, we have to evaluate these carefully because it effectively wipes out a lot of our profit.
Our frontrunner is a premises in St James Park station for which we have put in an application. Although it is not in the city, where I ideally want my first sites to be, I think it is a good location with the right demographic (office workers) and very heavy footfall. At the same time, we will apply for something in the city, and the frontrunner there is Bow Lane.
It’s all coming together, and I will post the executive summary of my business plan onto this blog and invite any feedback. I'll also fill you in on what's happening with premises.
In the meantime, back to work…
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